Tax Net Wealth

ii iv viii	Merry Christmas and Happy New Year NEW - In 2016 the 2-4-8 Tax Blend will become 2-4-8 Tax Choice The "choice" would allow all taxpayers to choose an income tax rate between 8% and 28% paired with a net wealth tax rate of 2% going down to zero. Wealth taxes paid would reduce Estate and Gift taxes (also set at 28%). This would encourage wealthy individuals to pay some net wealth taxes as a form of inexpensive life insurance.	Wealth 0% 0.5% 1% 1.5% 2%	Income 28% 23% 18% 13% 8%
		Business C - Corp	4% VAT 8% Income

Computing Non-Business Income

Eliminate Income Deductions, Exemptions and Credits

Our current income tax system computes the "taxable" amount by permitting offsets for each person in the household, interest on student loans and mortgages, state and local taxes; charitable contributions, etc. Under the 2-4-8 Plan all deductions, exemptions and credits should be eliminated in order to achieve the lowest possible flat rate income tax for all. The favored treatment in the current system is simply counterproductive.

Taxing Net Wealth Adds Fairness to the System

With a low income tax rate of 8% the value of a deduction is greatly reduced when compared with the present marginal tax rates. It is also worth considering that the wealth tax component of the 2-4-8 Plan adds sufficient fairness to the system to tolerate the elimination of well entrenched deductions. For example a collage graduate with large student loans would not pay any wealth tax until his or her assets exceeded the amount of the loans. Similarly, the deduction of mortgage principal to compute the net value of a house in the wealth tax return, mitigates against the loss of the traditional deduction of home mortgage interest. A couple who owns a home only has to pay a 2% wealth tax on the current equity in the house rather than the full market value - (which is generally used for local real estate taxes).

Home > Tax Blend > 8% Flat Income Tax

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