[Rhodes22-list] Flat Tax Anyone?

[Brad Haslett]

Slim,

Shock!  That's an understatement, but welcome to the club anyway.  I did a
tax return for a Minnesota resident several years ago when I part-timed at a
CPA firm and was appalled at the state income tax rate.  It probably hasn't
changed much.  Now Minnesota has done some good things with the money, like
build a first class education system, but like all things dealing with
economics the law of diminishing returns eventually takes over. As I recall,
Willie didn't evade taxes, he had some bad financial advisers who put him in
some shady tax shelter schemes.  When the marginal rates get too high (over
90% at one time) people start to get creative, or they just quit producing.
The beauty of the flat tax is that the 'rich' still pay more.  You can give
some modest exemptions to low income earners to balance the 'fairness', but
you have to tread carefully there as well.  Playing social science games
with a flat tax will eventually create a code as complicated as the one we
have now. For an interesting study in tax evasion, google 'Vernie Kuglin'.
She was a former co-worker of mine now retired.   Vernie had some BIG ones!

Brad


On 1/12/07, Slim <stevenalm at comcast.net> wrote:
>
> This may come as a shock but I agree with Ed--sort of.  When someone works
> hard, starts a business, creates jobs, successfully produces goods or
> services and tows the line of the American Dream, the more successful he
> is
> the more he is taxed.  It's to the point where he's expected to cough up
> half his money.  Half!  Further, he doesn't have to be Uber-rich to reach
> that tax bracket.  And that's just income tax.  It's a wonder any small
> business can make it in Minnesota where the cost of doing biz is higher
> than
> most.  In fact many small and large businesses are indeed pulling out and
> setting up shop in Wisconsin--still high costs but not as high as MN.
> People complain about tax breaks for the "rich" without considering their
> tax burden in the first place.  Do we really need to put Willie Nelson
> behind bars because of tax evasion?  He went bankrupt digging himself out.
> After all, hooch (biz expense) is very expensive these days.  Should
> Willie
> really owe the country millions of dollars or does the country owe
> him?  In
> Ireland, for example, artists (in the broad sense of the word) pay no
> income
> tax at all.  But I digress.
>
> Couldn't we end all the bickering by changing to a flat tax for all?  At
> the
> very least it would make for a much easier tax form and much less work for
> accountants, auditors and the IRS which would save everyone mucho dinero.
>
> Slim
>
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