So the concept of tax reform gets several of my family members hot and bothered . . . I’m not sure what that says about my family but I leave that for a therapist to sort out in 10 years when I have time for a visit. In the meantime, I propose the following:
1. Flat tax, say 15% on current income for those earning more than $50,000 annually. For those earning less than $50,000 annually, total payment can be made in kind as in #2 below. No loop holes. This will be a huge boost to the Treasury and will reduce the dead weight cost of filing for those who are contributing less than 5% collectively to the Treasury. See contributions based on income level on the middle of this page. Remember, the top 5% of tax payers contribute 57.1% of the total. The bottom 50% of tax payers contribute less than 3.3%.
2. In exchange for getting back at least one weekend a year, you will be expected to contribute to local charities that meet certain thresholds. You have the option of contributing TIME or MONEY or any combination of the two. The point of this measure is to reconnect locals with locals. Charities to benefit from your expenditure of time and or money must consistently demonstrate that more than 80% of all funds raised go directly to the mission purported and MUST BE LOCAL. This should not discourage you from supporting non-local charities as you are gaining both time and money from the measure. This measure is to redistribute our most valuable resource, you. Your intellectual capital deployed locally is much more important than a long-distance, fickle fingered bureaucrat’s.
By the way, the donation of time and or money must be done by you, personally. This represents work/money for a tax savings. You may pay your way out (thereby negating the effective savings) or you may perform the work yourself.
Proposed Schedule of work:
< $50,000, 25 hours of community service
$50,000 – $125,000, 10 hours of community service
$125,000 – $250,000, 20 hours of community service
>$250,000, 45 hours of community service
This schedule represents my experience working with those in a variety of income brackets – who has free time and free cash flow.
The pay your way out schedule would look more like this:
< $50,000, 15% of your total income
$50,000 – $125,000, additional 5% of your total income (above the 15% flat tax)
$125,000 – $250,000, additional 5% of your total income (above the 15% flat tax)
>$250,000, additional 10% of your total income (above the 15% flat tax)
I’d like to see the rate even lower, and it is important conceptually for everyone to pay into our system. Our government doesn’t really need that much money when we trim the fat and turn over local activities to local people. We will fund the government for less administration and more administering. We need a Federal system for roads, but do we need a Federal system for schools?
Image courtesy of Fibonacci Blue