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Here
is a second offering to consider the
principles for tax reform in Virginia. The
first principle was to tax the fixed and
finite land, air, water based on how these
‘finitudes’ are used (See "Virginia's
Finitudes," July 11, 2005). The
second principle for taxing incomes, profits,
purchases, inheritance, fees and anything else
under the sun should be the sum of fairness,
appropriateness, and minimalism.
Fairness
is for both the Sovereign of the Commonwealth
- each individual citizen - and the State. The
Sovereign and the State have an unwritten,
unsigned, binding social contract. Each
individual citizen Sovereign gives some
authority and power to the State to make rules
and acquire taxes, execute administration, and
judge disputes and crimes. The grant of
authority and power is limited and revocable.
Likewise, the State serves and protects the
individual equitably with full faith and trust
for honesty under the Rule of Law.
Appropriateness,
like beauty, is in the eye of the beholder,
and generally means fitting the tax to the
purpose of the tax revenue. For example, users
who profit from a taxable activity should pay
the most. So, most of the revenue for
transportation should come for taxes, tolls
and fees on vehicles, licenses and fuel –
all things related to the transportation
infrastructure and services the Commonwealth
provides.
Minimalism
means, simply, as little money taken for as
limited government as possible. The purpose of
minimalism is twofold. First, the power to tax
is a limit on freedom. Limiting taxes expands
freedom. Second, capital growth and the
increase of wealth for the common good is
about four or five dollars created from each
dollar invested in the economy. The return of
each dollar taken by government, even if it is
spent on public works, is under 25 cents to
the economy.
The
golden goose of capitalism shouldn’t be
cooked spending on Public Goods. A low, flat
income tax is the fair and proper way to tax
wages.
The
jealous and wrathful God of the Holy Bible
demanded only a flat tithe. The secular state
deserves no more. The Commonwealth should not
use Karl Marx’s progressive tax structure to
unfairly punish one class of voters with
discrimination. All income from all sources
should be taxed once and only once.
Abolish
inheritance taxes. Death taxes are socialist
retribution against the dead and their
bereaved families.
Reduce
sales taxes, if possible, over time. If a
citizen’s money is taxed when it comes into
the family, why should it be taxed as it goes
out? Reducing consumption reduces the
economy and the general wealth.
Tax
services and products equally, as little as
possible, without the myriad of exemptions
that serve special interests and breed bad
politics.
Create
"communities" in legal standing of
family, faith, work and neighbors. Within
these communities transfers of money and
pooling of money in savings for health, senior
care, education and legal services should not
be taxed. In fact, as practicable, tax credits
should be created. Every dollar shared by an
extended family for a health savings account
is multiple dollars the business corporations,
state and federal governments will not have to
pay for indigent health care.
Create
Virginia "Trust" or
"Commonweal" accounts for every
Virginian -- everyone -- after a year of legal
residency. These accounts would be for health,
education, un-employment, legal and retirement
needs. They would work like IRA/401k hybrids
– on steroids of imagination for broader
contributions and better savings.
The
devil hides in the details of rules of
deposits and dispersals, but in our
Information Age it isn’t hard to figure out
a portable account number (like the former SSN)
with resources parked in Virginia financial
institutions for life. The Virginia "communities"
of common interests cited above could
contribute as well as the individual.
Businesses
might get tax benefits for profit-sharing in
these accounts. The Commonwealth might make
donations from the General Fund for the
poorest of Virginians, as possible, from birth
to help them help themselves with life long
savings.
The
sources of revenue between the Commonwealth
and 134 cities and counties should shift. One
percent of income tax should go directly to
municipalities. The outrageous tax
increases of 2004 were not the "reform"
or "investments" the politicians of
both parties are spinning. The cause of
revenue imbalance in 02 – Medicaid –
hasn’t been addressed. Yet, the huge surplus
will be spent and more taxes urged.
It’s
up to you, Voter, to make the candidates for
state-wide office and the House of Delegates
answer the real issues on taxing – taxing
principles, not partisan spin.
--
August 8, 2005
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