What Type of Government and Taxes do You Want?

[Below is an excerpt from a much longer piece on world society]

Scenario

Many years have passed, and the United States and much of the world has achieved a conscious adulthood and finally climbed out of its turbulent adolescence, but only after severe trials and tribulations affecting all human institutions and peoples. The old politics of polarization and divisiveness, corrupt and preferential governmental and other policies, much indifference to the poor and uneducated, and the pursuit of wealth as a means to an end at all costs, have been exposed as vacuous and destructive, and have been relegated to the dustbin of history. Collective security provides peace and stability at all levels of society, all governments are based on the principles of federalism and democracy, and national borders defined and adhered to. Nation building has ended.

As documented in both The Secret Peace and The Better Angels of Our Nature: Why Violence Has Declined, human conditions are steadily improving and fair policies and practices have been instituted in all aspects of life. Over time, a moderating influence has blanketed human relations, based on noble human values such as love, justice, equity and social welfare. Governments heed the voice of the Silent Majority, silent no longer. Because freedom of expression, consultation and consensus govern all social relationships, timely and effective problem-solving is achieved more readily along with social good. Moderate policies in all areas have created organizational stability and reliability in free markets. A kindly tongue has replaced invective and violence in all their forms, and the goal of all human interaction has become mutual agreement based on truthfulness and equity.  

Here follows my glimpse of a possible future American society, based on this scenario:

    Government. By this time our federal system is strong, non-arbitrary and non-preferential laws and regulations universally applied, and state laws cannot trump or conflict with federal laws which now cover lower levels of human and business interactions.  Government serves all its constituents, at only five levels: federal, state, county, township and city. Three branches of government still apply: Executive, Legislative and Judiciary, with clear separation of duties, powers, and responsibilities and without internecine strife.

 They cooperate and support each other to the extent that the general public good and security are always the primary goals of all governmental operations. As individuals, Americans have ceded some of their personal rights for the common good of the majority. Strict regulations, limits, and controls, govern such things as the right to create and sell smut, ban or burn books, and purchase and own guns. Likewise, the States have ceded some of their sovereignty to make laws and collect taxes in favor of national standards. For example, access to, and availability of, good healthcare and competitive medical programs where the user knows all costs and prices in advance, and which are administered nationally, e.g. the Affordable Care Act Exchange, and archaic state laws restricting health, life, auto etc insurance sales and programs are administered nationwide with regional influences incorporated, and not state-by-state. Another example is a national sales tax of 6% on the purchase of 90% of products and services, including all items purchased online.

The Executive administers stewardship of the country’s vast resources and production, provides for common defense and emergency responses, as well as social services; maintains foreign relations, and enforces laws and regulations. Executive departments are limited to seventeen, as follows: Government Administration and Oversight, Treasury and Finance, Foreign Affairs, Transportation, Human and Social Services, Defense and Veterans Affairs, Agriculture, Law and Public Safety, Corrections, Education, Environmental Protection, Energy, Healthcare and Senior Services (e.g. Social Security, Medicare, Medicaid - with more emphasis on home care services), Commerce, Information Technology, Arts and Sciences, and Labor and Workforce Development.

The Legislative branch is composed of a bicameral legislature (i.e. senate and assembly), as envisioned by the Founding Fathers, and flourishes based on compromise and consensus at both the federal and state levels. Proposed laws are discussed in public forums before passage, and online access to all bills and ordinances provides multiple opportunities for public comment, opinion, and debate. Elected representatives vote their conscience and are not responsible to vote the way others would choose or wish them to, according to any individual, political party, cabal, industry or group. More than two parties coexist to accomplish solutions to societal problems. Elected representatives are not accountable to those who elect them, and their record speaks for itself. They adhere to the highest ethical standards and rules of conduct in order to retain their position.For example all campaign contributions have limits and influence-peddling and lobbying are restricted to information and fact-sharing.

The Judiciary. Municipal, county, state and federal court systems remain, but are coordinated and supplemented by citizen volunteers for certain criminal and civil issues, such as impartial mediation to adjudicate disputes. Many state laws have given way or been abolished in favor of uniform federal laws, much like the national transportation system and interstate commerce is handled. This applies to criminal law as well, except there is some leeway in creating strictly statewide laws and local ordinances. For example, in driving, right on red is the law of the land, but applicable governing bodies can post signs with restrictions or changes based on jurisdiction and local conditions. Most laws are crafted to be flexible in this way. All laws and regulations are easily accessible and searchable online by any citizen or organization, both well before and after passage, and there is an easy online process for commenting. The universal legal age for adulthood is set at 18.  All proposed and approved laws are published daily in major media outlets and are easily searchable online, as are governmental budgets.  Laws are reviewed every three to five years for applicability and are modified or abolished to fit the times.

Government Funding for all levels set on a two-year budget cycle:

Income tax - progressively higher based on income level. Very few loopholes and fair, limited, standard deductions only. Government promotes social polices like promoting and installing energy efficient and renewable energy sources with tax credits. Minimum taxable income levels set before taxes are due. There are few exceptions and and exemptions.

Sales tax - One country-wide flat sales tax (eliminating use tax in those states like NJ that have one), say 6% to start. Sales taxes collected by all businesses as done now are forwarded electronically from business bank accounts to a Federal account bi-weekly. A new federal taxation collection division of revenue, part of IRS, collects national sales taxes and accounts for it publicly. Businesses have online access to all their records, like a bank account. This IRS division pays for itself from taxes collected, and distributes rest back to each state on a pro-rated basis based on how much tax is collected from that state's sales. Same taxing, rate-setting and collecting processes, apply to all online Internet sales.

Business tax - Same principle, progressively higher based on revenues FROM ALL SOURCES (i.e. all products and services sales), received by the business, including investment interest made by the company. Business "Pilot projects" are taxed at an initial lower rate for 3-6 months only, then revert to full rate regardless of status of project/product/service success. This generates innovation, new products and new construction etc. Also, Special lower tax rate for business construction (or renovation of existing land/buildings), in blighted cities/brownfields area, BUT, all such lower rates have either time or project completion limits, including, for example, adequate leeway to become a viable entity, whether a housing complex with most units rented/sold etc. Gone are town, city, township, state and "special" 10+ year tax breaks for property taxes etc. and the cut throat practices associated with such vying. Special incentives for relocations or locating new business should and must be offered, but limited to up to three years absolute maximum, after which they revert to standard rates on the project. This eliminates public entities from unfair advantages, and makes them compete based on their natural resources both of skilled labor forces and natural resources. The three year rule applies to determine viability and taxability of any and all businesses. Determinations may be made based on products and services which specifically promote social good, and such are rewarded and/or tax slightly abated.

City wage tax - Cities are recognized as having population density requirements not found elsewhere. For example more and better public transportation like busing and subways is needed as well as more police, fire etc. More schools are necessary for higher concentrated populations. Cities apply for wage tax collection permits to the State/Feds who set reasonable standards.

Property tax - Owning real property (residences, land, buildings etc), is taxable based on services received such as fire, police, trash collection, education etc, and is tiered for homes (higher for 2^nd and 3^rd homes etc), business structures, land (developed, undeveloped) or farms - which are taxed at the lowest rate but only if productive and active, with fallow soil-building years built-in.

Luxury tax - Collected on luxury goods and services based on State or county where purchased. Tiered by industry or type of product, for example: high performance automobiles over $50,000 each, and  homes over $750,000, taking into consideration market values in the area and going rates. Foreign big ticket purchases are taxable if used or housed in U.S. more than 6 months a year.

Non-profit tax - Guidelines are set against absurd accumulation of wealth from contributions/donations/grants which may or not be earned and used by the entity, which kick in only when minimums are exceeded. The goal of non-profits should be to provide the service economically and efficiently to members and clients, and/or the public, pay all their bills, and have rainy day funds which should be non-taxable. But rainy day fund exemptions are set at various percentages of total personal/business income/revenue levels less expenses. And all non-profit expenses have to directly serve the organizations members and constituents or the public. Humanitarian funds and services are non-taxable, however, interest or dividends received on unearned income are taxable in all cases. Individual and business donations to certified charities and humanitarian or public welfare funds or endowments remain tax-deductible.

Important: All taxes paid by individuals, business and any and every entity, are not taxable again. Like now, standard deductions can be taken as set by Fed policy with State and local and personal input and updated every two years. Boards of taxation at all levels exist with educated members from the communities and businesses and governments, and have appeal processes.

Goal of any tax: Pay for what is needed by the public welfare and safety and for government to provide for such needs, mostly assisting private sector to do so where at all possible, and regulating commerce, education, the environment, energy, national and local defense, human services, and health and welfare, etc.

Goal of any tax deduction or credits: To promote the social good and better social behaviors, education at all levels, clean air and water and land, parks, modernization of outmoded/outdated, less functional or efficient materials or systems, like improving Information Technology.

Goal of all government: To promote the social good - employment, infrastructure (transportation etc), modernization, social services, safety etc.

NOTE: The Government needs enough funds to operate effectively and efficiently based on the needs of their constituents of all types - individual and business and other organizations.

  Best, Rod
Copyright 2014 

Surviving Bipolar Disorder in the modern age . . . a journey of Hope for the afflicted.
My poetic memoir Episodes available at www.amazon.com/episodes-rodney-richards/dp/0615914705/   

 

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