Taxes and Tax Reform

“Our new Constitution is now established, and has an appearance that promises permanency;
but in this world nothing can be said to be certain, except death and taxes.”
Benjamin Franklin 1789
franklin
They put Franklin's picture on the $100 bill as a subliminal reminder of all your money fleeing your wallet
as taxes to be wasted on programs that don't benefit you.
(Oh wait. Corporations are people, too.)

This author once asked a prominent attorney,
"If a law was written and passed in Swahili (an incredibly difficult language), would it be the law of the land?"
He queried what I meant?
The Federal Tax Code, when printed out and bound, fills up two pickup trucks.
No human being alive can understand the tax code in its entirety. It might as well be written in Swahili.
How can something be a law if it is incomprehensible?
If it were comprehensible to only the most incredible genius in the world, how could it be law?
Or even if it were only comprehensible to a high-priesthood (H & R Block)?
Does that qualify it as an enforceable law?

Washington is all abuzz about "tax reform".
This is synonomous with raising middle-class taxes and reducing the taxes of the wealthy and corporations.
Suppose, for an instant, that a rational system was chosen.
Further suppose that it was incredibly simple.
To this end, this author proposes that we hire the Mongol Hordes as tax advisors. (????)

In the Middle Ages, the Mongol Hordes swept out of the eastern vastness and conquered everything in their path.
Once they had administrative control, they instituted a tax system.
Ten percent of your income. Period.
Not your "depeciating-the-ceiling-fan" adjusted gross income.
INCOME.
Ten percent.
Move the decimal point.
Those who refused or cheated were killed- often in a horrific way. Results were good.
No deductions.
Doesn't matter if you're a blind, gay rabbi moonighting on Sundays as a Baptist preacher.
Ten percent.
Same goes for Bill Gates and Warren Buffet (methinks they would agree).
If you cheat, killing seems a bit harsh (though for hedge-fund operators torture might be in order...).
How about sacrifice the income you cheated on? (First offence).
Second offence- sacrifice your wealth.
Third offence- prison.
Works for me.

Corporations are people (?) , so they should pay ten percent of their income. Including anything hidden offshore.
Moving offshore to escape tax, results in seizure of domestic assets and refusal to be allowed to do business here.
Lying results in the tongue being cut out.
Corporations beef about the 35% corporate tax rate and being taxed on dividends.
Reduce it to 10%.
Reduce and simplify. Ten percent. Period.
You might imagine corporations would jump on board immediately...unless they're cheating...
If it exceeds your bottom line, raise your prices dipwad.
That becomes an effective and allowable tariff on job-stealing Chinese goods.

If you make $2,000, move the decimal point. Pay $200. Everyone pays. Even the poor have skin in the game.
If you make $20,000, move the decimal point. Pay $2000.
If you make $200,000, move the decimal point. Pay $20,000.
If you make $2,000,000, move the decimal point. Pay $200,000.
If you make $2,000,000,000, move the decimal point. Pay $200,000,000.
Does it get any simpler?
A tithe, like supporting the church except you get streets instead of bonus points in heaven
.
Inherit a million from your mom? Move the decimal point. Pay $100,000. (Beats the heck out of the old system of 55%).
Win the lottery? Pay 10%.
Win the tavern drawing? Pay 10%.
Get food stamps? Pay 10% (how?)
Win the lottery and received food stamps in the past? Pay back the food stamps with interest and pay 10% of the lottery.
What's not to like unless you are already CHEATING!
Is the middle-class cheating? The word you're thinking of is "beating" (and they're receiving it- daily).

U.S. Gross Domestic Product (GDP) in 2015 was 18 trillion dollars.
The underground economy was as much as 2 trillion dollars (or likely more).
Buying a used book is not in GDP.
Inheritance is not in GDP.
Casino winnings are not in GDP.
A multi-billion dollar takeover of a company is not in GDP (transfer).
Social security is not in GDP (almost 1 trillion dollars).
We're nudging 30 trillion dollars already.
Speaking of casino winnings, Wall Street's annual turnover is 5000 trillion dollars per year!!!!!!!!
Do I sense an opportunity to balance the books?
Holy Cow!
One percent of that would run the Federal Government for thirty years and no one else would have to pay taxes. Yippee!

Federal tax revenues were 3.7 trillion in 2015.
ALL income from all sources would have to be 37 trillion dollars for the "Move the Decimal Point" to work.
The 30 trillion above is ballpark.
Eliminate the national debt and its interest.
Rationalize military spending.
What about taxing transfers of wealth on Wall Street? Bingo we're over the top!
Plan on major resistance to anything as sensible to this.

A final note:
When this author lived in Jamaica in the Socialist/Communist years, the customs duty on imported goods was 174%!!!
There was a mini-industry of false invoices, cheating etc.
Everyone with any sense became a default criminal.
After the institution of a sensible government, the duties were harmonized to 10%.
Guess what happened?
The revenues remained the same, even though the rates had been reduced by almost a factor of twenty!
Everyone felt 10% was fair and paid their tax.
That's how human beings work.
Imagine how it might work by "moving the decimal point"?

You heard it here first. Let's do it.

Return to Home.