[Sosfbay-discuss] Prop 13 effect in Santa Clara County

[Ed Blackmond]

On Wednesday, November 2, 2005, at 07:03  AM, alexcathy at aol.com wrote:

> The latest breaking news is that those crazy Bushies want to screw
> around with the mortgage deduction on Federal Income Taxes.

I don't think this is a bad idea.  I think *all* tax deductions should 
be eliminated and *all* income should be treated equally.

If need be, the tax deductions can be replaced with programs that can 
be properly accounted for and include sunset clauses for when they are 
no longer needed.  For example, as long as banks need subsidies, there 
could be the mortgage bank subsidy act that pays people to take out 
mortgages.  The larger the mortgage, the bigger the payment to the 
individual (and indirectly, the larger the revenue for the bank).  
Actually, to make it even more clear, the payments should be sent 
directly to the banks.  In this way, the cost of the program becomes a 
line item on the country's financial report (budget) and everyone can 
see what it costs.  When the act sunsets, it can be determined if banks 
continue to need this subsidy and if the benefits are worth the cost.  
If so, the act can be renewed.

Similar acts could be enacted to replace all the other subsidies (tax 
deductions).  For example, we could have the wealth subsidy act that 
would subsidize wealthy people who buy expensive things and pay them 
back a percentage of what they spend.  No longer would these people 
have to deal with determining if something is a five year or 30 year 
asset and if they should use straight line depreciation or dollar cost 
averaging.

Or simply eliminate all the deductions and not replace them with 
anything.  Not only would this balance the budget, but would generate a 
huge surplus to pay down the incredible national debt.

In the process, payroll taxes should be eliminated, or applied to all 
income regardless of the source or amount.  Why should income earned by 
someone hammering a nail into a board be taxed to fund social security 
while income derived from selling a share of stock not contribute to 
social security?  Eliminate payroll taxes and include social security 
as a line item on the budget.

Doing this would certainly make the tax code much less complex.  It 
might even be called simple.

Ed