Transformational Tax Reform: Withhold Taxes From Every OTHER Paycheck
On April 1, we became the worst country on Planet Earth in which to open and run a business - from (at least) a corporate tax perspective. Our rate is 39.5 percent - the highest in the world. That is stealing.
And not only is the corporate tax rate obscenely high, the code is thousands of pages of nightmare mess. With its dizzying litany of deductions, exemptions and other a la carte specialty nuttery.
Business tax reform is a vital necessity. A much lower rate - and a much simpler code - would make the seas much calmer and a whole lot more amenable to job and wealth creation.
The reason there hasn’t been more of a public clamor for corporate tax reform is because most members of the public are employees, not employers. Relatively few Americans open businesses and actually experience the corporate tax code absurdities first hand.
Which is why a rewrite of the individual tax rate and code - which is just as expensive, complex and asinine - also needs to happen. To get more Americans on board the tax reform train.
But the vast majority of Americans don’t understand the inanity of the individual rate and code either - because the government has gone out of its way to hide it from them. By withholding taxes from our paychecks.
Every time we get paid, they bleed us blind - blindly. Most of us have no idea how much the government takes from us.
So here’s the solution: withhold taxes from every other paycheck. That way we’ll see just how much we lose to Leviathan.
Let’s take a hypothetical single guy with a $35,000 salary. Paid twice monthly. Who withholds exactly what he owes in taxes. And see how he does from one paycheck to another.
(We’re looking exclusively at federal income taxes and FICA. Your state results will vary.)
Income tax: $ 3,450.00
FICA: $ 1,980.00
Take home pay: $29,570.00
Paid-in-full paycheck (paid on the 15th of the month): $ 1,458.33
Taxes-withheld paycheck (paid on the 30th): $ 1,005.83
Difference: $ 452.50
How’s that for a bi-monthly visual aide for the cost of government?
You want transparency - this is it.
It would take exactly two pay periods for this guy - and just about everyone else - to start voting like Ronald Reagan.
A simple Congressional bill would effect this every-other-paycheck change.
It would be but the slightest adjustment for employers to cut the two different checks.
But it would fundamentally transform how We the People think about taxes. Both individual - and corporate.