Maine Opinion
Bangor Daily News
Jan. 26, 2012, Editorial, "Wealth must be
tied to tax debate"
2-4-8 Response
I fully agree with the premise of the title that,
“Wealth must be tied to tax debateâ€. On the one hand it correctly suggests
that a tax reform debate is needed; but at the same time it confuses the
debate by failing to distinguish between a tax on net wealth and a tax on
high income. This confusion is common in the media and one of the main
reasons why I write this comment.
Tax attorneys will tell you that the federal government
may tax net wealth, sales and/or income as a source of revenue. When you
write, “their wealth is a logical place to start looking for tax revenue†it
is not clear if you endorsing a net wealth tax or simply supporting higher
income tax rates for high earners. I believe that if we tax a little of each
base (i.e. wealth, consumption and income) we can resolve all of the federal
tax issues (and let the politicians focus on the spending and debt issues).
In August of 2006, I proposed the 2-4-8 Tax Plan to the President’s Advisory
Panel on Tax Reform. It consists of three flat rate taxes: a 2% tax on the
Net Wealth of Individuals, a 4% Retail Sales tax and an 8% Payroll/Business
Income tax. The exact same rates apply to the rich and poor. There are no
different tax brackets, deductions or credits, and no favoritism. The three
taxes would yield about $2.6 trillion per year (slightly more than the
current combination of Income, Social Security, gasoline and other federal
taxes and fees).
It is hard to imagine anyone that wouldn’t welcome a 2% tax on net wealth
and a small 4% sales tax, in exchange for drastically reduced 8% individual
income tax rate. Even the "fair and balanced" Bill O'Riley (a/k/a the
Factor) supports a national sales tax (of about 3%) as a necessary component
of tax reform. The concurrent elimination of social security, capital gains
and estate taxes and a significant reduction of the corporate income tax
rate to 8% should guarantee near universal support for the 2-4-8 Tax Plan
from liberals and conservatives alike.
Don’t you think jobs would grow and the economy would boom with an 8%
corporate tax rate? The 2-4-8 Tax Plan is fair and does it all (except clean
up the spilled milk).
Eugene Patrick Devany, JD, MPA
www.TaxNetWealth.com
Jan. 25, 2012, "In Romney returns, an
argument for tax reform"
2-4-8 Response
I agree that in this election year the important,
“question is how to reform the tax code†but this should go beyond simply
making sure that, “those with great wealth pay their fair shareâ€. I believe
we can make the system fair, more efficient and provide incentives for all
businesses (not just the manufactures, high technology and clean energy
businesses singled out for counterproductive tax credits by President
Obama). ...
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