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View Diary: The Bush Tax Cuts in Pictures (104 comments)

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  •  What impact would that have on revenues? (1+ / 0-)
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    RMForbes

    The current income stream from the existing progressive tax would have to be replaced at a minimum, and revenues need to go up substantially to begin to impact the deficit, and reduce the existing debt.  What you suggest sounds good, but only if it acheives the goal of more revenue.  I like the source of the revenue you suggest.

    •  Federal revenue would be more stable and would (0+ / 0-)

      be higher than the current system because of the increased economic activity caused by added billions at the bottom of the economy and removing taxes more slowly. Replacing all of payroll withholding with a much small gross business receipts tax would allow all payroll dollar to change hands at least once before any taxes are removed. Then it would be much more slowly which would allow the payroll dollars to change hands many more times before being finally removed by flowing up and out of the local economy. Remember the current system removes (withholds) 25% of the gross earnings of 80% of Americans before it can circulate in the economy at all.

      The income tax would generate more revenues both because all the ways the current system is gamed will be gone and it will be far more expensive to remove excessive profits from a business or corporation. It will be less expensive to keep capital actually working in our enonomy. However I do not have the expertise to accurately calculate the actual progressive tax marginal rate structure but I'm sure the rates would not need to be any higher than our current system. If the first rate were kept as low as our current system then increase slowly from their it would be great for business competition and effectively end top big to fail.

      Really don't mind if you sit this one out. My words but a whisper -- your deafness a SHOUT. I may make you feel but I can't make you think..Jethro Tull

      by RMForbes on Tue Aug 24, 2010 at 12:54:59 PM PDT

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