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[Avinash_Tyagi]

superchunk said:
My questions would be what about the states.

Right now nearly all states already have some form of a sales tax. This usually divided up by the city, county, and state.

If the ALL taxes were gone, *poof*, how would the states make revenue? After all this discussion is for federally taxed items, correct?

So, I pay 8.1% sales tax right now plus my taxes on my house and car related stuff and another smaller portion of pay gets taxed all to the state.

Does this all remain? Would I be paying the 23% federal sales tax plus the 8.1% that I currently pay? How would state income tax work? Right now it is based on the amount I pay to the federal government.

If all that goes away too, then where does the state and city get revenue from? Does it all get shifted to the government and trickle down from there? That would surely suck for the richer states like California.

I don't know. I will have to read the proposal to see if it answers these questions.


Personally I like a flat tax system.

Eliminate taxes on various items you already own like phones, houses, and car registration, etc.

Then keep a sales tax system for the cities and counties for new goods only.
Make a flat 15% or so income tax on everyone's income, no breaks of any kind.
Then the state income tax could also be level to a flat % of that.

This way it is still fair for all, and much simpler.

 Flat tax is too much of a burden on the lower income households, especially those that are at, below or slightly above the poverty line