While I hate the word "fair" (or rather how some people abuse the term), one thing that Obama's occasional speech about making the rich pay their fair share of taxes does make me think about, is that nobody seems to define WHAT a "Fair Share" is, which brings up a very interesting question to me: In a society such as ours, how much of the fruits of our labors does society as a whole "deserve" for everything from medicare for the poor and retired to transportation and defense?

We obviously all have different ideas for what taxes should be used for, but I'm curious to see what people think is fair. While this question is primarily geared towards the majority of us which live in the states, I'd be very interested to see what those of us that live overseas think as well.

Question number one: For the following income brackets (assume total income, not taxable income), what is a "fair share" for a citizen to pay for ALL taxes (federal, state, and local income, property taxes, sales tax, taxes on gas and other products, etc) besides capital gains, which is a completely different beast? I would not include social security as it in theory will be paid back in part to you upon retirement.

$0 to $8,950:
$8,950 to $36,250:
$36,250 to $87,850:
$87,850 to $183,250:
$183,250 to $398,350:
$398,350 and up:

Question number two: Should taxes on capital gains be a flat rate as they are now, or bracketed? If flat, what should the rate be? If bracketed, what would the brackets look like?

My answers:

Under $14,500 [= full time at minimum wage for 2000 hrs/year]: 0%.

Anything over $14,500, 10% of all income over $14,500, less any contributions to not-for-profit churches or charities.

No deductions for anything else.

This is the approach I would take.. you pay the same percentage regardless of the level of income you earn or the amount spent upon snake oil accountants.

Don't know that I would have the floor set at 14,500 though. Rent/Mortgage, food, health care on $1208 a month for anything over a single person. Not going to work out. So it couldn't be just a flat 14500 a year type statement.

I use to say 10% flat tax. But that was Fed only. If you add every kind of a tax under the sun then 40% should do it.

Your numbers are too low, thresholds and tax %. The idea of a graduated tax system is to help the impoverished build themselves up. A 10% tax on the wealthy is spitting in the face of people who work with their hands and backs. I don't quite understand your insistence on letting the lucky people off like freeloaders - but that's your thing.

Because I don't believe most of the wealthy are freeloaders any more than I believe most of the poor are freeloaders. Most of the wealthy are, IMO, wealthy because they have helped create a great deal of wealth.

Paris HIltons, rich wall street lawyers, millionaire congress critters -- these are the exception, not the rule.

And the impoverished don't need tax revenues to build themselves up. They need opportunities to show the world what they can do. And who have those opportunities typically come from? People who are wealthier than they are who are willing to trade part of the wealth for the services of those who are less wealthy.

I'd have no problem with taxing Paris and the lawyers and the congresspeople at 80 percent ... if someone could show me how to distinguish the useless rich in a reasoned/systematic way from the wealthy who work hard and provide productive value. I dare you, or anyone, to put 100 random American multi-millionaires in a room, all of them strangers to you and to the national media, and pick the 5 or 10 who are useless appendages on society.

IMO it can't be done.

And that means every time we try to punish those useless appendages by progressive taxes or whatever, we're going to take away another chunk of the incentives the non-useless rich have to stay in this country and use their above average skills of creating wealth for us to share.

*THAT* is why I think progressive taxation is about as dumb, and as hubristically ignorant, an idea as man has come up with.

It is less effective than your guillotine would be, less honest, and easier for those useless rich to avoid.

Care to be more specific on the social programs?

Edited by member Wednesday, November 14, 2012 4:30:08 AM(UTC)  | Reason: Not specified

I've already laid it out - married filing jointly - the first $50K is tax free -no deductions or credits thereafter. Single people the first $25K.

Next - you eliminate special incomes at different tax rates. Interest income and income from capital gains is taxed the same as real work income.

Next - no more caps on SS taxes. All income is subject to SS.

The graduated rates start at 15% from $50,001 to $100K and jump a percentage every $50K and cap off at 30%.

We'd be ought of debt in 5 years. Of course the sailboat industry might take a hit.