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Comment by supernova87a | Hacker News Reader

Simplified taxes does not have to mean lower taxes. You're conflating 2 issues (or intentionally associating them).

Removing loopholes, reducing the kinds of things that can be claimed without solid proof (or likelihood of needing to be proved, or complicated to prove), reducing the amount of paperwork that can create loopholes, etc. is part of simplifying.

Removing personal deductions, a simple 1-step calculation, is not simplifying.

And reducing tax rates is not necessary to simplify taxes. A graduated income tax is very simple.

Think about it harder. Don't be intellectually lazy and just jump to cutting certain taxes because it would be "simpler". Unless that's your goal.

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>> Simplified taxes does not have to mean lower taxes. You're conflating 2 issues.

When did I suggest lower taxes? I suggested sales tax increase which would offset removal of personal income tax.

You're implicitly implying that sales taxes would be lower than an income tax. Which they would not be (for most taxpayers), in order to raise the same amount of revenue.

Sales taxes are generally regressive.

If you're poor you're paying a high percentage of your income on this sales tax.

If you're not poor a much smaller percentage will be towards sales tax.

>> of your income

Rich people have investments and that is not income for tax purposes if it is correctly set up. For many rich, they have escaped from W2 taxes on income. "Income" according to the personal income tax code of IRS.

Poor working people, and middle class, have IRS income. The rich have investments and trusts and LLCs and loopholes.

LLCs cannot be used to avoid income taxes. The income from an LLC passes through directly to the tax returns of the owners, where taxes on it are due and payable. Same with trusts and trust beneficiaries.

Capital gains on investments are taxable as well, although some people can defer paying capital gains taxes simply by not selling until they need to. That does not avoid taxes, but rather defer them until later.

If anything "the rich" are subject to additional taxes, notably estate taxes. Irrevocable trusts can be used to reduce estate taxes, but do not reduce income taxes except by having a different person (the trust beneficiary) pay taxes on trust income.

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