A 21st Century Tax Plan That Makes the Ultra Wealthy Pay Their Share
The US tax code taken as a whole is completely regressive. The least wealthy pay the highest percentage of their wealth to the government, while the 11,000 ultra Oligarchs pay the lowest percentage.
The age old question, should the wealthiest amongst us pay the most or the least percentage of their wealth in taxes? Ok, maybe we all know what the answer should be. The wealthiest should certainly pay at least the same percentage of their wealth in taxes as the rest of us 99%. Yet, here we are in a world where our Oligarchs pay significantly less of their wealth as a percentage than you and I do.
The answer according to Adam Smith is that the wealthiest should pay taxes, “not only in proportion to their revenue, but something more than in that proportion.” When our Billionaire Oligarchs pay something more than in their proportion, then we can finally have a culture, economy and politics that works for all of us.
So, how do we get to the correct answer and have the wealthiest pay at least their share of their wealth, if not more? Simple, throw away every last line of our current tax code and start over.
It is time to institute a comprehensive wealth tax with a high exemption, so the first $500,000/yr (averaged over 3 years) of income from all sources of wealth is taxed at 0%, and every marginal dollar starting at $500,001 and up (to billions)/yr (averaged over 3 years) of income from all sources of wealth is taxed at 30%-70% for all individuals and corporations. The actual tax rate on every marginal dollar earned starting at $500,001 will be the magic percent that balances the budget from here to eternity.
What makes up all sources of wealth: wages, income from rents and royalties, net profit from a business, inheritance (spousal inheritance exempt), gifts (spousal gifts exempt), capital gains, earnings from wagering, life insurance payouts (spousal payout exempt), dividend payments and loans against the value of stock or other capital. All sources means all sources.
End stock buybacks. End the carried interest loophole. End all tax deductions, subsidies, tax credits and all other tax expenditures for all individuals and corporations. Tax every single dollar of comprehensive wealth exactly the same for individuals and corporations, no exceptions.
Institute a 5% flat Federal sales tax on luxuries that every single American pays when they purchase a luxury. The taxes generated from the 5% flat Federal sales tax on luxuries will lower the tax rate on comprehensive wealth over $500,000 to whatever the rate needed to balance the yearly fiscal budget.
Abolish the minimum wage and replace it with a minimum living wage. Fine companies that pay less than the living minimum wage the difference of the minimum living wage minus what they pay. No more freeloading corporations stealing our wealth!
Replace Social Security, unemployment, disability, and all other anti-poverty direct payments and tax credits with a Universal Basic Income. Every single American receives the UBI without means testing and without exception.
Scrap every last bit of our current health insurance nightmare and replace it with Universal Health Insurance (for all of us) with Supplemental Private Insurance (for the wealthy). This is the same universal healthcare system that Germany uses to deliver outstanding healthcare outcomes for half the per capita cost of our entire healthcare economy.
Stop using the tax code for policy purposes. If a government policy program is worthwhile, then budget for it and pay for it with tax revenue.
The people are being crushed under the current system that rewards and entrenches the Oligarchs. We need a new system that works for all of us. Think big, have imagination and advocate for meaningful radical change now!
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