Wednesday, April 13, 2011

A Fairer Tax for All

Just a thought about the big budget problem and a suggestion to help some and certainly make this more fair. Most folks do not realize we have a special tax bracket for those of us that have so much money they no longer have to earn money by working. Instead of earned -income they have something called capital gains, a special tax rate that does not ever go above 15 percent, and they are also special because they never have to pay any FICA taxes either. Most folks can pay as much as 32 percent in income taxes and then they pay FICA taxes or with holding for Medicare and Social Security.

A couple of years ago a very wealth man named Warren Buffett was reported as haven discovered his secretary paid more (higher or greater part of her income) than he did, he said, ” He was paying at the rate of 17 percent”, ( he must have had some salary income that caused his rate to go up the two percent) and his secretary was paying over 40 percent of hers.

My proposal would have something called a means test applied to the income and if a person has more than 50 percent of their income as capital gains they would be taxed as everyone else on any thing over 50 percent as earned income. If you are a working class person getting less 50 percent of your income from capital gains you would not be taxed any different than now. This way the folks that do not actually work ( no earned income) would still be taxed more fairly and some of the badly needed money to pay off all the wars since Vietnam might be able to be paid for. Wall Street needs to pay their fair share of taxes also, this is not asking for the rich to be over taxed, but just pay like every one else. If you go to the dog track and win, your winnings are taxed as any other income, so why not tax some of the earnings of the winnings on Wall Street?