My first boss told me "look at a country's tax rate and you'll know how socialist they are."  He was a smart guy.  I am not a socialist.  And I think the tax code needs to be simplified and restructured.

Amazingly, taxes are probably one of the most divisive issues.  I say amazingly since you'd think everyone would want lower taxes.  But in recent years "tax cuts" have become a bad word. Democrats are labeled "tax and spenders" and republicans are supposed to be fiscally responsible.  However, the years have proven both these assumptions to be wrong.  Clinton actually ran large budget surpluses after cutting taxes.  Bush, on the other hand, has accumulated massive debt.  The reason is because while the republicans have at times cut taxes, they have not cut spending.  The result is predictably disastrous.  Keep this in mind.

How much do we spend on taxes?  It's hard to say.  That's because there are so many deduction, exemptions and penalties that it's not a straightforward calculation.  What I can tell you is that on the margin (my most heavily taxed dollar), I pay 33% federal, 8% local, 8% social security + medicare (up to the 90K maximum) and 7% sales tax.  That's 56%.  By any measure, that's pretty socialist.

So let's get down to business.  And let's make the "rich vs poor" debate completely irrelevant.  The fact is that the bottom 50% of earners pay less than 5% of taxes.  So let's just eliminate their federal income tax altogether.  That seems pretty fair and doesn't have much impact at all on the budget.  And now we can get past the rhetoric. 

I propose:

• Single flat tax
• $50K exemption
• Elimination of the inheritance tax on the first $10MM (hey- you earned it!)
• Get rid of the difference between 401Ks and IRAs => they should all be treated like 401Ks.  We NEED people to save for retirement.  The government doesn't have the cash to pay for this. 
• Capital gains tax of 15%
• Dividend tax of 15%
  

 What's the tax rate?  Well, we just need to calculate it.

Now for corporations:

• Flat tax on earnings
• Eliminate all loopholes except deductions for interest and depreciation
  
• Go after any firm trying to avoid taxes through incorporation overseas
  

That's it.

DEBATE IT!