Many people think there needs to be change in regards to taxes. The currents US tax code is excessively long and riddled with loopholes and exceptions. The problem is in fixing it. So what do we do to fix it? What is the best form of taxation?

The AICPA(American Institute of Certified Public Accountants) recently listing principals of how to judge a good tax reform in 2005.
These principals are as follows:
1. Simplicity
2. Fairness
3. Economic Growth
4. Efficiency
5. Neutrality
6. Transparency
7. Minimizing Noncompliance
8. Impact on Government Revenues
9. Certainty
10. Payment Convenience

All of these principals are equally important according to the AICPA.
I find these principals to be accurate covering what a good tax reform would be.

Now what system fits these principals the best?
I find it to be the fairtax tax reform.
We need change and if you have a better plan please state it.
Lets go threw the fairtax relating to principals.

Simplicity: While not being as simple as some other forms fairtax is fairly simple. It is very simple compared to the current code, which in length is over 60,000 pages(USATODAY.com - Scrap the tax code).
That goes against a mere 53 pages according to my computer, pasted the bill into openoffice and saw how many pages there are. For the taxation part it is a simple 23% tax rate on all goods and services from business to consumer. It provides a prebate to families to cover the tax cost of necessities which is determined by family size. This would replace the multiple taxes already in place by the federal government.
"TITLE I--REPEAL OF THE INCOME TAX, PAYROLL TAXES, AND ESTATE AND GIFT TAXES

Sec. 101. Income taxes repealed.

Sec. 102. Payroll taxes repealed.

Sec. 103. Estate and gift taxes repealed."
GovTrack: H.R. 25 [109th]: Text of Legislation

One of the main principals of the fairtax was it simplicity. It does fairly well in this category.


Fairness: This can be a tricky one. How to we determine if fairtax is actually fair.
Exemptions: Exemptions lead to special interests and are not fair. Fairtax eliminates exemptions. It makes it harder for special interests and other influences to effect our tax code.
Education: Many would agree that taxing education would be detrimental and unfair. Well fairtax doesn't. Education is an investment and is treated as so.
The poor: It is important to many that we treat the poor fairly. This is done threw the prebate. The poor can get all their necessities completely tax free. The poor will also be helped by the boost in the economy, which will come up soon.
Equality: It treats all people equally.

Economic Growth: This is a large problem with the current code. Only consumer sales are tax America would become a tax haven to all business. The current tax code is making businesses go overseas. Fairtax will not only bring those back, but overseas businesses will come here. This will cause a boom in available jobs and foreign money coming to the US.
People with money are putting there money in foreign banks which is a drain on our economy. With this new tax code they would not need to do that and that money would come back to help fund our economy. They would no longer have a reason to go overseas for their banking needs.
Fairtax is a savings based tax instead of the consumer based tax we have currently. People would start savings more. Savings helps the economy, that is just economic fact.
It is also predicted that the real pay of all people would increase do to the economic growth caused by enacting fairtax.

Efficiency: This one is determined by many others in this case. Fairtax will be very efficient. As we will see later it will decrease the amount of tax evasion. It is simple and fair. All of these factors help in its efficiency. It is a very compact efficient way of taxation.

Neutrality: It is very neutral. It gets rid of the exemptions. It stops the special interests from getting tax benefits. As you can see many of these different categories tie together. It treats everyone the same.

Transparency Transparency is the ability to see how much you are being taxed. All the tax will be up front. 23%. Unlike now when you feel hidden taxes from all other things up to that purchase. Our current system is not all that transparent with the total tax burden you feel. You can not get any more transparent than this system.

Minimizing Noncompliance Of course we want to do what we can so that everyone pays taxes. Well with fairtax it would take two to cheat on taxes. Since taxes are done at the counter only. The seller would have to allow the consumer to cheat on the taxes. That would be harder than simply filling out your tax form wrong. It makes it much harder to cheat on your taxes. Most companies are not going to risk jail to help someone else save money on their taxes.

Impact on Government Revenues: Fairtax is revenue neutral. It is designed to make as much income for the government as it does now. That is what we want for tax collection. Spending is a different issue that most certainly needs to be addressed, but not in tax reform.

Certainty: How certain are they that fairtax will work. It was designed to be the best tax reform. Economist are the main influence in the fairtax and there is a very high certainty that fairtax will work just as it was meant to. This is not just any old guys plan.

Payment Convenience: This is another big improvement. Instead of having to collect from all those individuals they would only need to collect from businesses. The calculation for the payment is very simple. We currently have to file complex forms and individuals as well as businesses spend billions to plan and file taxes. This will be a huge reduction in convince.

As far as tax reform goes I see no better than fairtax.

So what do you guys and girls think?

This is the Part I have the most problem with: Government is squandering money on wasteful programs and has exceeded its limits defined in the Constitution. It is using our own money to spy on us without court orders and criminalizing behavior that shouldn't be criminalized. Money is being siphoned from wage-earners' pockets to benefit special interest groups and corporations. This is wrong. Fair tax would continue this waste.


Wasteful spending and taxes go together so I disagree with this statement.

__________________
"Feminism has fought no wars.
It has killed no opponents.
It has set up no concentration camps,
starved no enemies, practiced no cruelties.
Its battles have been for education, for the vote,
for better working conditions ...
for safety on the streets, for child care,
for rape crisis clinics, women's refuges, reforms in the laws.
If someone says, "Oh, I'm not a feminist!", I ask,
"Why? What's your problem?" - Dale Spender

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While I agree that spending is a problem. I do not think that is a problem for a tax reform. Taxing is about the taking of money not the spending of it. Also it would be much harder to pass a tax reform if you tried to tackle spending at the same time.

I think we should work on the spending problem, but there it would be almost impossible to tackle it while completely changing the way taxes are collected.

I think that it will increase the tax burden on the poor while giving more tax relief to the rich who really don't need tax relief.

The main problem with the tax system is simple.
90% of America's wealth is controlled by 3% of the nation but they only pay 40% of the taxes.

__________________
Walt Whitman
"I say that democracy can never prove itself beyond cavil, until it founds and luxuriantly grows its own forms of art, poems, schools, theology, displacing all that exists, or that has been produced anywhere in the past, under opposite influences."

Wasteful spending may be a different issue, but what needs to be established is that the federal government do what the rest of us do, live within our means. We need some type of legislation that says that income and outgo must at least balance.

I don't see the progressive tax issue dealt with, unless I missed it. How is the increased percentage of taxation for the rich issue resolved? Or is it? How do we convince the Super Rich to quit offshore banking and get them back into full compliance with the law.

Well that is not true. It would be quite a relief on the poor. Tax free on necessities. This system will be quite beneficial to the poor.

It is progressive because of its benefits to the poor.
They would have no reason to have their banks offshore. They will return here.

I have heard that before and every time they make changes the poor end up bearing more of the cost of this nation so you'll have to forgive my skepticism.

__________________
Walt Whitman
"I say that democracy can never prove itself beyond cavil, until it founds and luxuriantly grows its own forms of art, poems, schools, theology, displacing all that exists, or that has been produced anywhere in the past, under opposite influences."

Well I have work soon, but after I will go into that part in more detail and hopefully show you how.

"Need" is irrelevant, we're all legally equal and thus should all pay the same percentage of our income and/or expenditures. If anything, the fair tax plan (which I oppose) would put MORE of a burden on the rich because (surprise) they spend more money.

If you like the idea of a state-sponsored notion of a caste system, by all means support unequal taxation. Those of us committed to equality and freedom will take our ball and go home.

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"Bring me that horizon".