09-17-2017, 06:43 PM
(09-16-2017, 07:40 AM)Belsnickel Wrote: A lot of truth to this. We talk a lot about rates, but in reality it isn't necessarily that we need to raise rates, but we need to broaden the tax base.
True, it really does come down to broadening the tax base. But marginal rates also do matter. Broader base and lower rates is the path I think most economists would favor. The complexity of the tax system and cost of compliance is many BILLIONS in deadweight economic loss.
I think we've made a huge mess out of corporate tax rates and capital gains. Double or triple taxation or whatever, but the two really go hand-in-hand. You could lower the corp rate and eliminate capital gains exclusions to offset it, being revenue neutral for all. You could also do the reverse, but I suspect that would be very suboptimal.
As long as you have preferable tax treatment of cap gains break (and dividends, ISO's, etc), I don't really feel like you are going to raise taxes on the wealthy. A lot of people that get punished by high individual rates are not 1%ers they just had a really good year once.
I think a VAT or national sales tax is inevitable, but some states already have sales tax north of 10%. And if you look at Europe, the VAT just keeps going up (I think 30% in some places). But consumption taxes are generally considered superior to income taxes.
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