FAIR TAXATION

For the first 120 years of this country we had no income tax. We didn't need an income tax then and we don't need an income tax now. Whether we can repeal the 16th amendment and get rid of the income tax may not happen in step one, but let us at least have a fair and free system where everyone must share the burden of taxation. For instance, if you can vote to get a benefit for you, but demand that I pay for it, that is not going to promote long term freedom and prosperity for either of us. The more you use or make, the more you pay, but it must be proportional and that is the fundamental key to fair taxation.

Two other core ideas to fair taxation are that it be simple and only used for revenue generation and not intimidation or returning favors. This is what the current complex code does. It's so complicated that what the IRS demands you pay becomes a matter of interpretation. Loopholes are written into the code to favor the politically connected. It's nonsense. If we have to have an income tax it should be flat with very limited if any deductions, such as the money you give to charity. Remember most of the loopholes are for the politically connected anyway not for you or me.

The other core idea to fair taxation requires that the tax rate be as low as possible. A very common falsehood about taxes is that the higher the tax rate the more money the government raises in revenue. This is not true. The higher tax rates go up the more you cut economic growth. In economics, there is a point that higher taxes and maximum revenue cross which shows the most revenue the government can raise. It is much lower than you may think, about 10-15% depending on which economist's model and deductions you include, far lower than our current system. This rate is for all taxes, including social security and medicare. This rate should be applied to all forms of personal income and to business's net income. One rate, one set of rules, everyone pays. That is fair taxation.