The Fairest Tax of All

If ever there was a word that has been misused beyond recognition it is the word “fair”.  What really is “fair”?  More specifically what does it mean to pay one’s “fair share”?

Politicians have all kinds of ideas for replacing the current system.  Some speak of a “flat” tax.  Some speak of a “fair” tax.  What would a “fair” tax be?

Some would say a fair tax means we all pay an equal percentage of our income.  For example, we all pay 15% regardless of whether we make $15,000 per year or 15 million per year with no deductions for anyone.  That would certainly be a step in the right direction.

But allow me to be even bolder.  I have a different definition of fairness.  My view of fairness is that we are all equal citizens of America and therefore we should all pay an equal amount to fund our government.  That’s right – an equal dollar amount, not an equal percentage.  Our current tax code does not apply equally to all citizens.  Some are asked to pay more not because they are given the right to vote more than once or receive more government services (in fact the poor pay no taxes and receive more government services than taxpayers), but simply because they earn more money.

How is that “fair”?  If you were buying the same car as your neighbor who makes $30,000 per year would you think that it is fair that you should pay twice as much for the car just because you make $60,000 per year?  All around the country people are paying varying amounts (or nothing at all) for the same government that serves us all.  And not surprisingly, those who pay nothing and receive benefits from the government are all for tax increases that increase those benefits.

When the takers have more political power than those from whom wealth is taken, there is no hope of a government behaving in a rational fiscal manner.  All you end up with are more politicians pandering to the masses with more government handouts and more people clamoring for those handouts.  And all the while the ones paying for the very scheme from which they derive no benefit are accused of not paying enough.

So my plan is this:  every year Congress shall pass a budget establishing the total dollar amount that will be needed to fund the government for the following year.  The portion that is derived from the Federal Income tax shall be divided equally among all citizens and legal aliens (the elderly and the disabled would be excluded).  It would be submitted in the form of a bill that the tax payer could pay in a one-time payment or in installments over 12 months.   No more deductions.  No more tax brackets.  We all pay the same amount.

If the government spends less than was projected (and pigs start to fly) the excess revenue would be divided among the taxpayers and returned to them in the form of a refund check.  If the government spends more, the amount will be divided among all Federal workers (and only Federal workers) and they will receive a bill.

This plan makes all citizens painfully aware of what their government is spending and it holds Federal workers accountable for sticking to a budget.  It is about as simple and as fair as you can get.

But what about national emergencies, you may ask?  I would take a cue from financial guru Dave Ramsey and have the Federal government start an emergency fund.  Using historical data, the fund should be set at whatever the average annual expenditure has been to cover the cost of emergencies.  Contributions to maintain this fund would be factored in to the annual budget.  And lest politicians abuse this fund to pay for things that are not true emergencies, a law should be established stating that a national emergency must be declared by the President and confirmed by a two-thirds vote of both houses of Congress.

So as you finalize your tax forms this year and wonder whether or not you’ll be targeted for an audit, consider this simple and fair alternative to our overly complex, easily abused, and anything but fair current tax code.