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[Darkwind3]

Massively increase the deficit, help the super-rich at the expense of the middle-low incomes, etc.  Basically what you'd expect from a Republican tax proposal.

And apart from anything else, isn't having a massive tax spike well... stupid?  It can genuinely damage incentives.  If getting a pay rise would suddenly cause you to pay 15% more tax then maybe you'd want to avoid it.  Wheras with a smoother tax rate rise you'd take home more money for a greater salary in all cases, meaning you'd have an incentive to get a pay rise at any income level (although Republicans might maintain that the fact that you're losing 35% of it to tax would still magically demotivate you).

fakeedit: Beaten, but to elaborate a little bit n case someone for some reason doesn't want to read Aqizzar's links: tax rates are marginal, that's why they're rates. That means if, say, you have a $0-$100,000 tax bracket at 10%, and a $100,000+ at 25%, but you have an income of $1,000,000, you pay only 10% on your first hundred thousand (for $10,000 in taxes there), and 25% on the rest (for $225,000, and $235,000 total). If you earn $100,001, you pay 10% on the $100,000 and 25% on the $1.

This example is highly simplified obviously, but that's basically how taxes work. Being in that 25% bracket wouldn't mean you pay 25% on your entire income, just the part not covered by the (presumably) lower brackets.

[nenjin]

Why is this so terrible?

To explain my point, a territory-based tax code would basically allow American corporations to bring all of their money back to the U.S. and actually pay less tax on foreign business transactions than they do now. Currently, we tax money corporations make abroad when they bring it home. So they keep vast sums of wealth in off-shore banks. The change proposed to the tax system would only require US corporations to pay the taxes to the governments they do business with. (Currently what happens now is they get to write off those expenses when they file their taxes here in the U.S., to avoid taxing the same profit twice.)

So in essence, U.S.-based corporations would be able to re-inject all their money back into US holdings while contributing even less to the general health of US finances. Which they would then turn around and re-invest back into foreign business dealings. It would save them time, effort and they'd quit having to hide half of their holdings from the US government. At the cost of the taxes we do manage to get from them for their foreign business dealings. Nice deal for them, innit?

It's basically a Republican wet dream of free enterprise and zero government regulation or taxation (beyond the earnings they make with the American economy, which we know they won't unless we essentially pay them for that privilege by making it cheaper and more attractive to do business here than in 3rd world countries.), which they would sell as a "job creator" with "all the money corporations would suddenly re-invest in the American economy."

And that's before we even ever get to the tax bracket shenanigans.

Between SOPA/ACTA/NSA.....and this tax plan, the only thing we're missing from Shadowrun is the goddamn magic and dragons and shit.

[GlyphGryph]

Yeah, if you think about it:

Everyone in the US pays the same amount in taxes on each dollar they earn. It's just that the "n"th dollar has a higher tax rate than the ones before it.

[mainiac]

What would make sense would be a calculus based tax system where instead of brackets you literally tax every dollar slightly more then the dollar before it.  It might sound like a lot of math but it isn't actually, instead you'd just find you taxable income (as you do now) then type it into the IRS website tax calculator to find out what your liability is.  Alternatively for the internet adverse you could just do your taxes according to a bracket then have the IRS send you a refund for the difference between the brackets and the more modern system.

But we are a country that doesn't even have proportional representation or a carbon tax so something like this is a distant, distant pipe dream.

[Osmosis Jones]

What would make sense would be a calculus based tax system where instead of brackets you literally tax every dollar slightly more then the dollar before it.  It might sound like a lot of math but it isn't actually, instead you'd just find you taxable income (as you do now) then type it into the IRS website tax calculator to find out what your liability is.  Alternatively for the internet adverse you could just do your taxes according to a bracket then have the IRS send you a refund for the difference between the brackets and the more modern system.

But we are a country that doesn't even have proportional representation or a carbon tax so something like this is a distant, distant pipe dream.

That, and from what my friends that did economics/business at uni told me, calculus is *far* above the level of maths most economics majors are taught to deal with.

[Aqizzar]

What would make sense would be a calculus based tax system...

Yeah, the real problem with that is, you want a tax system where the average citizen could (at least theoretically) work out their taxes longhand, to see if anything has gone amiss.  I'll be the first to admit that it's a tragedy the only tax plans that can be sold through Congress are either ones a highschool dropout can understand (even though most ordinary people still refuse to learn it) riddled with side effects only a trained accountant could ever find, but a tax system that requires an engineering calculator and/or a bachelor's of mathematics is a bridge too far.

[MaximumZero]

9/9/9!

[mainiac]

What would make sense would be a calculus based tax system...

Yeah, the real problem with that is, you want a tax system where the average citizen could (at least theoretically) work out their taxes longhand, to see if anything has gone amiss.  I'll be the first to admit that it's a tragedy the only tax plans that can be sold through Congress are either ones a highschool dropout can understand (even though most ordinary people still refuse to learn it) riddled with side effects only a trained accountant could ever find, but a tax system that requires an engineering calculator and/or a bachelor's of mathematics is a bridge too far.

Well it might seem less clear, but also keep in mind that this tax system makes the progressiveness of the system much more explicit.  You can't pull the bullshit that Bush pulled and claim that most of your cut goes to people at the bottom at the same time that you decrease the progressiveness of the tax system.  If you make the tax system more regressive then it's written right there in the coefficient.

You don't need a BA in math or an engineering calculator to do integral calculus.  Highschoolers can do integral calculus.  Sure most people aren't comfortable with integral calculus, but most people aren't comfortable with the current 5 bracket system.  And if you don't want to do the math, just log onto the IRS website.

9/9/9!

Works great in SimCity!

[Sirus]

You don't need a BA in math or an engineering calculator to do integral calculus.  Highschoolers can do integral calculus.

Got any statistics on that one? Just because math comes easily to you doesn't mean that most Americans can do it. Hell, I don't even know what integral calculus is, and I'm well on my way to an associate's degree (working on a bachelor after that).

[mainiac]

Integral calculus?  I.E. calculus involving integrals?

In a nutshell it's where you have a function of how something changes and you find the total change.  So if I have a function of the speed that I drive over time, I can find my distance traveled.  If I know the pull of gravity, I can find the speed and velocity that things fall at.

[Sirus]

Let me rephrase that: I don't know calculus. I've never taken a calculus class. I'm sure I could figure it out, I did ok in advanced algebra, but if you shoved some calculus formulas in front of me right now I'd never figure it out. Expecting some blue-collar worker who hasn't taken a math class since he got his G.E.D. to understand it well enough to do his taxes is a little much.

[mainiac]

Let me rephrase that: I don't know calculus. I've never taken a calculus class. I'm sure I could figure it out, I did ok in advanced algebra, but if you shoved some calculus formulas in front of me right now I'd never figure it out. Expecting some blue-collar worker who hasn't taken a math class since he got his G.E.D. to understand it well enough to do his taxes is a little much.

Again, you would no longer need to know calculus to do your taxes then you would need to know the advanced accounting and econometrics behind the COLA adjustments to pay your taxes under the current system.  You'd just plug your taxable income into the approximation formula and then get your tax rebate for the difference a few weeks later.  Or go online and type your number into the IRS website and get the result.  The point here is that we have machines to do these things, so why not let the machines do them?  Instead we insist on humans doing them and have to dumb them down.

[Sirus]

Let me rephrase that: I don't know calculus. I've never taken a calculus class. I'm sure I could figure it out, I did ok in advanced algebra, but if you shoved some calculus formulas in front of me right now I'd never figure it out. Expecting some blue-collar worker who hasn't taken a math class since he got his G.E.D. to understand it well enough to do his taxes is a little much.

Again, you would no longer need to know calculus to do your taxes then you would need to know the advanced accounting and econometrics behind the COLA adjustments to pay your taxes under the current system.  You'd just plug your taxable income into the approximation formula and then get your tax rebate for the difference a few weeks later.  Or go online and type your number into the IRS website and get the result.  The point here is that we have machines to do these things, so why not let the machines do them?  Instead we insist on humans doing them and have to dumb them down.

Not everyone has access to the proper machines. Or are you offering free internet service and computers for every American?
I'm not entirely sure what COLA adjustments and econometrics are; my father (who never attended college and wasn't exactly a stellar high school student) and I do taxes by hand, using those federal booklets you can pick up just about anywhere. Once we finish, we plug the numbers into the IRS website or whatever to get a second opinion, as it were. The numbers tend to match up. Are we and the websites screwing up, or is calculus so easy to understand that your entire argument is invalid?

[mainiac]

Not everyone has access to the proper machines. Or are you offering free internet service and computers for every American?
I'm not entirely sure what COLA adjustments and econometrics are; my father (who never attended college and wasn't exactly a stellar high school student) and I do taxes by hand, using those federal booklets you can pick up just about anywhere. Once we finish, we plug the numbers into the IRS website or whatever to get a second opinion, as it were. The numbers tend to match up. Are we and the websites screwing up, or is calculus so easy to understand that your entire argument is invalid?

If you don't have internet access then you do your taxes the old fashioned way and get a refund for the difference.

Cost Of Living Adjustments are factored into a number of federal statutes and affect the taxes that you pay.  The fact that you can pay these taxes without even knowing what COLA are is my point.  The actual measurement of what the real cost of living increases are is a monumental undertaking of economic measurement ("econometrics") and the subject of more then a little debate.  While we have a variety of tools such as the Consumer Price Index, we still are not capable of hitting the mark exactly.

Calculus isn't all that hard IMHO.  I'm betting you probably could learn it pretty quickly if you desired to do so.

[Frumple]

Not everyone has access to the proper machines. Or are you offering free internet service and computers for every American?
I'm not entirely sure what COLA adjustments and econometrics are; my father (who never attended college and wasn't exactly a stellar high school student) and I do taxes by hand, using those federal booklets you can pick up just about anywhere. Once we finish, we plug the numbers into the IRS website or whatever to get a second opinion, as it were. The numbers tend to match up. Are we and the websites screwing up, or is calculus so easy to understand that your entire argument is invalid?

To the first, Siri: Library. Liiiiibrary. Doesn't even need internet access though, just a calculator able to run the formula. Chain the bloody thing to the wall if it's that bad in the area or just produce some calculators strictly able to do the formula.

But yeah, we sorta' do offer free (albeit limited) internet service to pretty much every American. Just sayin'.

Anyway, the basic kind of calculus mainiac's talking about really isn't exactly rocket science; we're talking stuff like figuring out velocity, not anything fancy (I've seen this taught to average 5th graders, alright? Don't need to 'know calculus' to punch numbers through a single formula ). Also pretty sure that someone could just translate the formula into plain english if the formula itself was really that scary and incomprehensible for people. Then it'd just take maybe some multiplication or whatever.