

Redesigning Income Tax - AndrewDucker
https://www.owlfolio.org/uncat/redesigning-income-tax/

======
esquivalience
I enjoyed this. I also agree with the author that it has no chance of
adoption.

For me it comes down to varying definitions of "fair". The mathematical
approach we have here is inherently fair because percentages have the concept
of "fairness" encoded within them; all incomes will treated equally.[0]

However, when talking about tax reform "fair" tends to be used to mean the
opposite - taxing larger incomes more severely[1]. Sure there's a problem
there, but it's not being marketed honestly: using separate scales compounds
the effect of the usual more scientific scaling. I'm not saying that this
isn't sensible - but it's certainly not the same as fairness.

[0] Fair is just a word. I'm not talking about
[http://en.wikipedia.org/wiki/FairTax](http://en.wikipedia.org/wiki/FairTax)
but the concept is similar I suppose

[1] For example: [http://www.bnn.ca/News/2014/04/30/Canadas-wealthy-take-
bigge...](http://www.bnn.ca/News/2014/04/30/Canadas-wealthy-take-bigger-slice-
of-income-pie-OECD.aspx) “Therefore, it is all the more important to ensure
that top earners contribute their fair share of taxes” is fine in principle,
but it doesn't mean that to "increase effective taxation paid by top income
recipients" makes it more "fair".

------
kapnobatairza
I'm not convinced that income tax reform needs to be so radical. However, I am
convinced by the first part of his reform which involves instituting a basic
universal income. In my mind a basic income solves a few fundamental socio-
economic problems:

1) Allows us to eliminate complex welfare and social security schemes, while
providing food and life security for every citizen. You can't eliminate all
homelessness and poverty, but a basic income goes a long way towards
eliminating most of it.

2) Drives development through increased mobility. People tend to cluster
around areas where job availability is high leading to overcrowded cities with
high real estate prices. A basic income provides the life security necessary
to pursue living somewhere else, and will encourage people to move to
"cheaper" areas where their basic income will go much further. Why live in NYC
on your basic income when you could live in Kansas where your money goes a lot
further? You'd instantly re-invigorate middle America and cities badly in need
of urban renewal like Detroit.

3) Directly drives up GDP growth through increased consumption - Rather than
flowing inflation through fed/bank lending or government spending, flow
inflation bottom up through consumer spending.

4) Eliminates the economic paradox of sustaining human labour that can easily
be mechanized.

5) A basic income is a cushion which creates an incentive towards higher-
education and/or re-training and/or artistic/artisinal endeavours. Whichever
country implements a basic income will cultivate the greatest scientific and
artistic talent in the world.

I could go on but I'll stop there.

I realize there are some strong counter arguments against the basic income,
but most would simply argue that a basic income would have no real effect.
Given the potential benefits of such a proposal, I think it's an experiment
worth trying. The potential pros are too numerous to list while the potential
con is that it will be a complex poltical exercise that may have no effect.

