A Negative Income Tax?

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http://en.wikipedia.org/wiki/Negative_income_tax

I was reading up on Milton Friedman on wikipedia (he recently passed away) and I discovered this. It sounds interesting. Could this be a superior alternative to the progressive income tax, welfare, and the minimum wage?

IMO - yes

Vale Milton Friedman

Bazza - B.Ec., CPA.

It definitely has a few advantages such as simplicity as the modern US tax laws are massive.

We do have the Earned Income Tax Credit. While not a complete implementation of Friedman's ideas, it is a step in that direction.

Even if this was implemented, I'm sure such complications such as write-offs for charity and dependents would still exist. Plus, federal income taxes are only one tax. Many states also have income taxes. And if a city could figure out how to tax your income without excessively burdening the taxpayer, most would not hesitate.

You can get more than 110% income tax in Sweden if you're rich and not making those write-offs...at least you could that some decades ago. It happened to Astrid Lindgren, who wrote the Pippi Longstocking books, because she was too honest. Sweeeden! Yes!

Part of Friedman's idea was that taxes were too complicated and in order to simplify things he wanted to simply make a flat tax with a simple allocation for charity. But the reason I mention this is because the US tax code is many many many books long, with enough loopholes and insanities to drive one wild. Even if charity and dependents write offs existed, which I am not opposed to, there would be less loopholes and and crap to deal with than the current system. Friedman's goal is to reduce the size and intervention of government, so I support his idea, not the bastardization of it that might happen due to politics.

Our social security system interacts with the tax system so if you have dependent kids and low income, you get paid approx $11,000. This reduces as income increases so that you effectively pay no tax until you earn about $40k.

In some respects its like (-)ive income tax, but its very comples and marginal tax rates can be high as you pay income tax AND loose your family benefits.

Milton Friedman's concept is better.

In the end, we must reform the economies in that direction, given the phase of automatisation of the service sector. Either that, or people would need to become self-employed [and fight over scratches]. It is indeed tragic when we actually have the capacity to guarantee a high standard of life to everyone.

A living wage is a step in the right direction, not a government handout.

All it does is create a class of people who can't see any sense in working. the sterio type inner city male ends up competing for wages against the single mom who qualifies for all sorts of government benefits and he doesn't and can't afford to live on the low wages, while the woman can as long as they have children.

what liberals will never get is everytime the government tries to help one group of people, another group suffers.

A step in the right direction would be to directly bill back the employer for all government benefits their employee qualifies for and watch how fast they raise wages enough to disqualify their employee's from getting government assitance.

Why should the taxpayers subsidize businesses that don't pay a living wage and give them a advantage over businesses that try to pay a living wage ? All we end up doing is putting the good places to work out of business by helping the employee's of the bad places live off low wages and when the government overhead to manage the programs is added in, society ends up paying more than it would if people got paid a living wage.

George Bush is great
Newt in 2008