Tax system is corrupt because politicians game it
The July 7 “Chair’s 3 Minutes” column calls for continued tax-exempt status for municipal bonds. This points out why the tax system is corrupt – politicians game it.
Here’s a little ditty based on how much federal tax revenue is forgone due to various goodies to their chosen ones: 2 + 2 + 3 + 4 + 10 equals 21 percent. That is the amount everyone’s income tax could be dropped if special tax breaks for municipal bonds, alternative energy/electric cars, Social Security upper income limit, home capital gains exemption and the mortgage deduction were eliminated. If you paid $10,000 in federal and state income tax, Social Security and Medicare premiums, thanks to the squeaky wheels, you are on the hook for $2,100 more so they can avoid some taxes.
Tax deals for oil companies President Barack Obama shouts out all the time: 0.67 percent, or $67.
Suggestions: Get rid of the income tax for individuals and businesses. Go to a national sales tax. This takes a lot of power of politicians out of the loop and removes most of the tasks the Internal Revenue Service does. No threat of audit for most.
A proposal exists to replace Social Security and Medicare with individually owned plans that would double their effective benefits for elderly. These proposals cut premiums from about 12 percent of earnings to about 9 percent. Social Security and Medicare funds become your property.
Go to a gold standard to remove federal power to tax your earning power through inflation.