Issue 665 Rent Should not be taxed August 27, 2015

Yes I said it.  Rent you pay to a landlord should not be taxed.  Here are my reasons.

Rent should be non-taxable:  Landlords dole out property, or apartments to people who otherwise cannot afford to buy regular homes.  In short, for low income earners they do a service by keeping these people housed and off the streets.  Additionally, the landlord may be earning a stipend from his/her tenants on his/her land, but it is not earned income.  In this case it is the tenants paying for the upkeep of the house or apartment, and to help the landlord pay the local taxes (usually property taxes) as per the contract to live there. The landlord need not lift a single finger to provide any service however, as he/she can simply hire an outside repairman or group to maintain the property for them.  Likewise, the tenants who live on the property, with the landlord's permission, can hire their own repairmen, or others to maintain the property for them.  As such, while the landlord owns the land, he/she is not necessarily providing a service to the tenants in the first place.  Thus, it can be said that the money gained from the tenants is not earned income and is instead unearned income.  By eliminating taxes on such people (the landlords and owners of apartment buildings) it enables them to potentially lower the rent, provide better services, begin to provide services or even buy additional homes/buildings to rent out.

Conclusion:  People may have misgivings about this due to people like Donald Trump being counted in this category.  In short, landlords and apartment managers have a bad stigma attached and successful ones a worse stigma.  However, these people provide a service to a community whether it be for the poor, or for the rich who otherwise would build gaudy mansions.  There is really no need to tax people with respect to rent as it is not earned, and thus taxes on it should cease to exist.

Issue 664 Interest should not be taxed August 26, 2015

Unearned income is another category that is currently taxed by the federal government.  But is this fair?  I say no, and here is why.

No interest tax:  Interest is a value we place on money that acts as a penalty or as an incentive.  For bank accounts and investments it is an incentive to build up your account to earn more money which allows the bank and the invested company(s) to use that money to support loans and business expansion.  With loans it is a penalty for not paying back the bank quickly enough, which allows the bank to gain back money they would lose from people who would renege on their debt.  In all cases, nothing is exchanged and no effort placed via work to garner such funds.  It is given, and it is a punishment, and thus is not actual income.   As such, the money gathered through interest on loans, the money given by banks in the form of interests for keeping your money in longer, and the interest on your investments which act as a thank you for putting your trust into the company you have essentially given a loan to, is not income.  This is the difference between earned and unearned income, and as such, unearned should not be taxed.

Conclusion:  This is all my opinion, but if you're not earning it via a job for selling your labor, then it is not income.  The way I see it is that interest that acts as a reward is a gift in the same way one receives a gift or inheritance.  Interest as a penalty is not income as it is just that, a penalty on someone for not paying money back the lender on time. Sure, this means big time investors will no longer be taxed and that banks will not be taxed on the money they get from people paying interest on their loans, but neither will you.  You will be free to keep all your money if you invest, or get interest from your bank account.  If you loan money and charge interest, you will not have to file it with the IRS or other tax bodies either if and when interest charges go into effect.  People will be freed from this form of taxation that in my opinion was designed to punish people who gather money through unorthodox means like interest.  People in my opinion were envious of these lucky investors and businessmen who did not have to work at small time jobs all their lives and build themselves up the traditional way.  These taxes on interest are taxes of envy, and I say remove them in all their unfairness and jealousy.

Issue 663 Property Taxes August 25, 2015

Property taxes are one of the fairest taxes in existence if they are done properly.  Here is how.

A good property tax:  Property taxes are based on the idea that the amount of property you own equals how wealthy you are (or if you go the historical route, you are renting the land from God [according to Thomas Paine]). Property taxes today are generally done based on value of a home, or based on the livable square footage in a home.  These forms though cause problems as they are not stable or fair.  They are not stable for if the values of the homes in an area shoots up, then people will have to pay massive amounts of taxes which they may not be able to afford.  Likewise, if values plummet, then the government loses needed revenue which are used to maintain services.  If you increase the living area in your home with an addition, then you also may be paying more whether you are taxed on your home's value or the square footage of living space.  Also, lest we forget, assessors must be sent out by the government to value the homes and check living space to accurately gauge how much to tax us all, which is expensive (an expense we have to pay for with our taxes). As such, this form of property tax is punitive in this sense. So what is the third option here?

The third option is not based on value or living space.  It is based on the square footage of land upon which the home sits on.  In short, it is not your home being taxed, but the land it sits on.  In this instance, you are on 1,000 square feet of land, and each square foot is taxed at a $1 a square foot.  Therefor you will only pay $1,000 a year in property taxes.   The only way that would change from year to year is if the government raises taxes per square foot.  As such, say they raise it to $2 a square foot on your 1,000 square foot piece of land. You will then pay $2000.  Mean time you can build up as much as you want with respect to your home without fear of raising your taxes or the government losing money either due to economic downturns and values falling.   In short, you may do whatever you want to your home and have a plannable expense in the form of your taxes.

Conclusion:  The property tax I described here is stable, and does not require additional costs to reinforce.  Additionally, it is a plannable expense.  So you know per year how much money to set aside to pay your property taxes.  It is a simplified system that accommodates everyone.  I do not believe that the Federal Government should have access to this revenue though.  In this instance it will be reserved to the Local governments who would then give a small percentage of their revenue based on the population size of their area to the State government.   So what do you think?  Want a fairer property tax?

Issue 662 Sales Taxes are better August 24, 2015

If we were to eliminate the income tax, then we would need a replacement to fund things like the military, and parts of the government.  The only truly viable solution is a sales tax at the federal level.  What would that entail?  Let us discuss.

Sales Tax:    The legal reasoning that sales taxes can exist is that it takes place during the brief transition period when one person's property is sold for something of equal value (in this case money).  So that exchange of property (money is also your property) is the loophole that allows it to occur.  Keep in mind that if nothing is expected in return, say with inheritance, this loophole does not exist for there is nothing of value being exchanged.  

There is a few forms that this tax comes in with respect to how it is implemented and used.  In this case the sales tax will be on the final sale of goods.  Basically when you shop for a book, a computer or other product.  New homes also count as well.  But we cannot have exceptions for this to work.  As such, food and medicine will also need to be taxed as well.  Why? You ask.  Simple, by placing any exceptions, then the taxes on the other items will go up to compensate which may make other goods too expensive for the poor.  Your counter argument at this point is, that despite my argument, sales taxes make food and medicine more expensive and thus hurts the poor regardless.  I am correct right?  Well, here is my counter to that.  It will only affect a very small group of the impoverished in our nation.  Reason being is that as the poor are taxed via the income tax, they must expend time and effort to keep records and other time wasting exercises that are expensive all just to comply with the current tax code.  But by eliminating income taxes and most all other taxes, they will have the money to afford those goods like food and medicine (though medicine becoming cheaper is also an additional issue that must be addressed). So, all other taxes (save property which will be tomorrow's issue) are gone save sales taxes on all goods.  This means that all the taxes on businesses and investments that hinder profit, economic, job and income growth are now eliminated.  Therefore the poorest person would be the people who are homeless, which again is another issue that needs to be addressed in a different way, though eliminating taxes that would potentially harm their ability to get out of homelessness is a big step in the right direction.  

A sales tax is also fairer.  There is also no longer any special deductions, or special interests to try and manipulate the tax code.  No more tax cheats either as people are paying taxes when they buy goods.  As such, the businesses are collecting the taxes for us, from our buying items.  So we pay more taxes if we spend more, and pay less taxes if we spend less.  In such a system, we the consumer decide how much too actually pay in taxes per year.  And now you may be asking, but the government will be lobbied anyway to make exceptions and keep the other taxes?  Yes that is true, but if we remove the 16th Amendment to the United States Constitution which allows the government to tax us directly, then it is possible if the amendment creating the sales tax is worded properly.  In this case, the amendment would read something like this: The United States federal government is hereby authorized to establish a sales tax on all goods bought and sold in the United States.  However, there shalt be no exceptions on to what items are taxed and that the rate upon which those items value is taxed for all goods must be equal without question or exception.  Basically, no exceptions and no taxing one good more than another.  A truly fair and equal tax without any chance of corruption save ignoring the constitution.

Conclusion:  So what do you think of only paying a sales tax?  No need to worry about tax day or accidentally owing money to the IRS.  No more the government looting your bank account. Also, no more people not paying taxes as drug dealers, prostitutes and others who engage in illegal activities which are not taxed must still buy food, and buy other goods as well.  So they are taxed as well, which means they finally contribute to taxes.  Tourists will pay the tax too, which means tourism equals higher revenue for the government too which reduces the needs of the government to gather funds from solely its citizens.  It can work, but we just need to give it a chance.

Issue 661 Don't tax businesses August 21, 2015

At current, our business taxes in the United States are about 35%.  That is one of the highest in the world and it has a negative impact on the economy and thus salaries and jobs.  Maybe we ought to think about removing business taxes altogether.

Don't Tax Businesses:  Businesses are the driver of the economy.  There buying and selling of goods and services grows the gross domestic product and thus advances the nation with respect to economic growth and redistribution.  But we tax them.  But if we did not, what could possibly happen?  For one, it could potentially lead to more jobs and higher salaries as businesses will not have to worry about multiple accountants and records keeping which is expensive.  Not to mention that they keep all their money, including the profit.  As such, business growth can expand without the artificial hindrances of taxation and them passing off the expanse of their taxes onto consumers like you and me.  The no tax policy would make the United States more appealing to new businesses starting up and for foreign businesses to come in, which means more jobs, and less poverty.  Invariably, this also means more job experience and training for unskilled and low skilled labor which allows them to go from poverty to middle class and possibly to becoming rich.   As such, our country will overnight become the most competitive country for both businesses and jobs.   

Conclusion:  You see, without businesses we would have no economy, and our economy needs to grow.  Also, so would our wallets for businesses pass all their taxes back onto us!  We end up footing the bill.  If we can eliminate business income taxes, we eliminate fraud cases, legal proceedings and court cases about audits, and many other hindrances with respect to just paying business taxes and all the ancillary costs.  All this means is that we can spend less money on making up the losses the business will incur from taxes and have cheaper goods as well.  The business keeps their money and the government does not have to spend so much trying to collect it.

Issue 660 Don't Tax Non-citizens: Revisited August 20, 2015

So a while back I said do not tax non-citizens on their income.  My reasoning was that because they are not citizens and thus could not vote (which they should not until they become citizens), that they are being taxed without representation in our government.  Today I am revisiting this because we do want their money, but not in the same way you might think.

We want their money:  So one of the main reasons we do not want them taxed on their income if they live here legally is because they will have more disposable income.  As such, they can spend more which enriches the businesses around them and thus can potentially aid in reducing prices of goods over time.  You get it, by them spending money, the business gets richer and thus they can expand their services, or lower the costs of goods.  Also, if there is a sales tax (the best form of taxation with respect to getting at everyone's money legally) then they pay into the system without the need for extra paperwork or need to have them register.  Basically, sales taxes gets everyone without discrimination (though it works best when other taxes are reduced or do not exist.

Another thing we want from legal resident’s money wise is their businesses.  Business owners moving their companies to the United States means jobs.  This also means a growing economy and that our tax and economic system is business friendly enough to attract more businesses.  What do I mean by this?  The person (legal resident) will not be taxed, but if we maintain business taxes, the successful business will. And even if business taxes do not exist (my ideal system) the business will still have to collect sales taxes for the government when they sell their goods. This allows for the governments to gather tax money while the legal resident enjoys the United States acting as a tax haven for them.

Conclusion:  There must be a balance here though.  If a legal resident is not taxed, then it means that many more people will want to move here to reap the benefits and thus flood the country with non-citizens.   To counter this, we could go back to the old style system of saying you are a citizen after living in the United States legally for a specified number of years.  Ten is a nice number, and many of these legal residents already are of quality based on our immigration system.  So what do you think?  We can counter free loaders while bringing in business and tax revenue into the country. It is a win win situation with respect to economic benefits.

Issue 659 Direct Aid August 19, 2015

Direct aid is when either money or food/medicine is given directly to disaster/violent conflict victims, and the poor.  So what are the benefits and when should it be applied?

Direct Aid:  For one according to Foreign Affairs journal which discussed the topic, there have been no drunks, or addicts using the aid to feed their self-abuse.  In fact, any money directly given has been used to start businesses or procure what the individual needs to survive.  As such, the primary form of direct aid, being cash is best used in impoverished countries where a majority of people are self-employed like in Africa.  This direct money replaces or substitutes for the lack of capital, credit, insurance or products necessary to grow their businesses.  This means however, that countries like the United States where such services exist cannot have this form of aid for their poorer populations save for specific communities.  These communities being where the situation mimics the self-employed circumstances like in the African Continent.

The other time you want to give direct money aid to individuals is right after a conflict or a disaster. Both these situations limit localized knowledge so adequate aid cannot be given in the form of traditional aid like food stuffs.  So the direct aid via money is better due to the sheer flexibility of it so that the people affected can buy and get only what they need.  Thus this aid is cheaper as countries giving support need not spend massive amounts on food, clothing and the like per person when victims can simply buy it themselves based on need.

The final form of direct aid does not come in monetary form like the others.  This aid comes in the form of vaccines which are either subsidized or given free if they are too expensive for a population to afford.  Likewise it works the same with food when food prices rise exponentially pricing out the poor and risking a famine.  As per the examples, the conditions must exceed regular needs for this to work for this public good category of aid.

Conclusion:  Direct aid is being looked upon as the future of aid to people in trouble.  No more corrupt officials taking the money for themselves, the people who need it actually see the money and have the flexibility to use it when and where they need it.  Other forms of aid like direct aid in the public goods category make up for the rest.  What’s good about direct aid also is that it minimizes costs while maximizing the effectiveness of the aid itself.  As such, it is cheaper and easier to distribute to those in need.  It is my belief, based on the articles in Foreign Affairs Journal and others like in the Economist, that direct aid is the best way to go with respect to the future of aids programs.