Taxation

Taxes and Fees

First, we must admit that Taxes and Fees are a means of paying not just for govenment, but for all the services and benefits we have as citizens and residents.

Could simplify our tax and fee structures? When you read through the instructions for 1040 form, do you suspect that it might be 100 times more complicated that it needs to be? That taxes are only created, added, modified, but never lifted? Or, do you look at it all and say, wow -- I can't find anything that would be fair to eliminate now with all this stuff in there. Wouldn't our country fall apart if we picked apart the tax code?

Not likely. But then we probably can't just replace it whole sale either. At least you can't build support for a new structure if you don't have a new one worked out. So, the purpose of this section is to pose the question of an equitable tax structure for individuals (families), businesses, corporations (ie ENRON), and so on.

Consider all the expenses of our local home place, and all the expenses of the larger entities containing it. There must be a giant tax vector, a giant computation can distribute those costs (your taxes and fees) and allocates funding sources. That is revenue sharing.

Not so simple, unless you count LAST YEAR'S sales tax instead of projecting this year's -- A perennial legislative problem.

Tax Flow

(From a 2/21/2010 note found in deeds.) A tax bill from the county tax assessor has entries, eg: operational budget for schools, school bond measure, property tax (goes to what?), bond measures; Phone bill show obscure 'system' taxes, and so on. Ideally (naively?), each taxpayer should know where all their tax money is going to at all levels - national services and programs, regional services, local services. Revenues, on the other hand, come from taxes and fees paid by individuals, businesses, corporations, ... ?

Self taxing. A neighborhood can form a Local Improvement District to tax itself for fix a road, add sidewalks, etc. Businesses can form an alliance for provide safety, cleanups, and helping tourists or boosting tourism. Funding for tourism -- does that come out of a general fund at the state level?

Payroll (income tax) - city, state, federal. What for?

Fair? Constitutional??

(This is mainly about US Taxes, but likely applies everywhere.)

A big question is whether a person can be forced to pay taxes where some portion of the fund goes to support something they are opposed to: a trillion dollars on war, any money at all on abortion, the Arts, tourism, ... Answer is Yes. No one has ever beat this. Taxes are not elective.

Myth about federal income taxes were establish to pay for an old war, and then never sunsetted. Some people cite an obscure doctrine, and refuse to pay federal income tax.

Library of congress on this: http://www.loc.gov/rr/business/hottopic/irs_history.html

Wikipedia Tax protester constitutional arguments. https://en.wikipedia.org/wiki/Tax_protester_constitutional_arguments

Things to Consider

The following are just assertions and musings. I've yet to rigorously explore the application of the world model to taxation. References anyone? Your thoughts?

Each entity (village, community, etc) formulates and votes on its taxes equivalent to funds needed to operate, including some amount for contingencies. The Entity's budget consists of tax revenues, and income from other sources such as sales of information, fees, ...
No funds need leave a region or neighborhood only to come back later minus 50% for handling. Keep funds locally that are ear-marked for local use.
Corporate and individual tax payers pay the tax vector for their location. Tax would be proportional to time residing at each location during the year. Tax would be collected at each level for for aggregates of levels and re-distributed as per tax base vector. This is feasible with any technology, and I'm sure it is done by hand in places like China and India.
Part of school funding would come from (say) region, part from area, part from community, optionally even part from neighborhood. Have base level curriculum available everywhere regardless of ability of poorer n/h's to pay for it. Richer NH's could have all the extra curricular programs and activities they are willing to pay for, and they would be subsidizing the poorer schools. See links on Education page.
If there were a planetary tax, would all continents have to agree to it? The United Nations is supposedly paid for by all its members. [embarrassing footnote about my own country?] Space stations and colonies are financed by participating nations, although they may also be built and operated by The Private Sector.

Items to Formulate

The citizen pays taxes on income, property value, user fees, royalties, licenses, interest, cap gains, permits, ...

A business pays tax on its earnings, inventory, worker's comp programs, licenses, permits, transit district, ...

Taxes on sales of certain items - gas, automobiles, ATF, energy, bandwidth, phone line access, ... The list is not complete of course.

Revenue Sharing

Mryon Orfield is a leading proponent of revenue sharing. He is a Minnesotan legislator and heads an institute on this and other matters. See: The new Rules of Taxation .

Robert D. Atkinson of the Brookings Institure says of AMERICAN METROPOLITICS: The New Suburban Reality by Myron Orfield:

Perhaps the most compelling argument Orfield makes is that the ruthless competition among communities to attract commercial and industrial development is a negative-sum game in which communities provide hefty and wasteful tax subsidies to compete for development.
In this context, the Twin Cities' tax-base proposal-requiring that a portion of the increase in commercial and industrial property tax revenues be shared (to give all communities an incentive to cooperate in the economic development of the region)- makes good sense. As a result, if shared tax-base revenue goes to schools and is collected from industrial and commercial property, it can lead to an increase in overall welfare.

Original Article on New Democrats Online

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