I apologize for posting what appears to be a topic that already exists, but the other topic is in idea only and refers to a progressive net worth tax. This is quite different. My goal is to propose a vast, simplified tax system based on net worth. The math is relatively simple: In 2012, citizens of the United States were worth about $55 trillion. The US government collected about $2.3 trillion in taxes, which is about 4.2% of net worth. This tax collection breaks down as follows: $ Value (Trillions) % Income Taxes 1.1 47.83% Corporate Taxes 0.2008 8.73% Payroll Taxes 0.7412 32.23% Other Taxes 0.2687 11.68% Estate & Gift Taxes 0.0096 0.42% I propose eliminating all taxes (income, sales, estate, property, corporate, payroll, gaming, etc.) and replacing the current system with a flat fee 4.5% tax on net worth. The system would NOT be progressive. Under this system, a family worth nothing would pay nothing. A family worth $100,000.00 would pay $4,500.00 in taxes per year, regardless of income. A family worth $100,000,000.00 would pay $4,500,000.00 in taxes, which is readily affordable. And so on and so forth. This taxes the wealthy and the poor fairly. It covers more than what is necessary to fund the government and begin to pay down our abysmal debt. And taxes are so minimal on the lower class that exemptions for children and other issues become pointless. The big question is how to establish net worth. Now we could argue about this for sixty pages, but the current tax code is 7 bibles worth of information. I am quite sure we could hammer out an effective system with less information. My proposal is simple: We only include items worth $1,500.00 or more as part of your net worth. This includes liquid assets (cash, bank accounts, etc), stock portfolios, equity in real estate, automobiles, fine art, etc. It would include expensive electronics, such as commercial grade computers, but would not apply to consumer grade cell phones, laptops, etc, and definitely not to any essential goods such as food or clothing. Anything worth more than $1,500.00 would have to be registered the same way cars are registered. We would establish a depreciating value system for automobiles, electronics, etc. One big fear is people converting their worth to cash and hiding it. Although this is incredibly stupid, we could easily enough monitor cash withdrawals over a certain amount the same way the government monitors all transactions over $10,000.00 today. I am curious as to what other issues could result from this system? Where are the flaws? I am not an economist, but I see this concept of regulating valuable assets to be more effective than the current loophole ridden, inequality plagued, and mind-numbingly complex system in place. I am open to discussion and would appreciate constructive criticism. Please dont ridicule or troll as I am only doing this out of curiosity. Thank you
I completly agree. A truly flat tax, whatever the rate, is a fantastic idea. This would eliminate lots of unproductive jobs, like lawyers, accountants, and IRS agents, and free up capital to be spent on productive things, like building bridges and going to Mars. Or perhaps we could spend it on paying down the national debt and save the world from economic ruin
