I'm not sure why you exempted food, but that's a separate discussion.
I've heard about "flat rate tax" and "sales tax" before. It seems that
sales tax might be more fair to all different income levels. I've been
trying to figure out how this could be applied to higher income levels
without abuses. I think some high income earners get around taxes by
having their companies buy things for them, but if there are taxes when
a company buys something as well as when an individual buys them, then
the taxes get charged either way.
The hard part with this system will be the collection of taxes. How can
you be sure that everyone that sells something pays taxes on it. For
instance now we have a company that sells a product to a distributor,
that sells it to a retailer, that sells it to the consumer. The product
goes through lots of different hands but it is the retailer that
collects the tax. So the tax collector has to get the tax from the
right sales level, and they have to determine how much was sold in order
to know how much tax to collect. This would be the hard part. A
retailer could say that they sold 10 refrigerators this month, or they
could lie and say they only sold 5 refrigerators. It would take a lot
of man hours to audit this system to determine if they were correct or
not. I don't think we need to increase the size of the IRS anymore than
they are now.
> BINGO! We have a winner. "What is Income?" Abolish "Income" taxes
> all together. It is impossible to be fair when you can't define that
> which you are taxing. INSTEAD... tax cash flow. A consumption tax on
> everything but food, and at all levels.
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