Iron Chef Olorinus wrote:
No, he is saying he is for a flat tax. As in all income is income.
Sigh. Those are two different things. What makes a tax "flat" is whether the tax rate changes based on the amount of earnings being taxed.
Treating all earnings the same is a separate issue which has absolutely nothing to do with whether a given tax is flat. I'm just not sure how much more clearly I can say this.
And all tax is tax on income. And you pay taxes according exactly to the amount of money (aka income) that you have. Including inheritances. Including capital gains.
So no sales tax then? No import tariffs? What about corporate taxes? There are a host of different types of taxes, all with different rules. Arguing to scrap the whole system and just treat every dollar of economic activity exactly the same is a legitimate argument to make, but at the risk of repeating myself, has nothing to do with arguing for a flat tax within the context of a discussion about tax deductions on regular income.
Capital gains *is* taxed as regular income. Unless the gain is a "long term gain" (meaning the investment was held for at least a year before selling it). There are very good reasons why we tax long term capital gains at a lower rate than short term gains (and income itself). It encourages investors to actually invest in things that build and grow and make products rather than play quick gambles on the market trends. We want that. Eliminating the reduced tax rate for capital gains would hurt our economy and absolutely hurt job creation.
Payroll taxes are also managed separately, for their own reasons. We can have a discussion about this, but it's not the same as simply saying "I want a flat tax". A flat tax means you think every dollar of a given set of earnings should be taxed at the same rate. No deductions. No credits. No manipulation. No loopholes. Everyone pays X% on their earnings. I really don't think that's what most liberals actually want.