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Creating a People's Tax System

Creating a People's Tax System

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Published by Jabari Zakiya
Here's how to abolish the 'income tax' and IRS with a simple, fair tax system that truly benefits the American People, essentially now the Fair Tax, HR-25.
Here's how to abolish the 'income tax' and IRS with a simple, fair tax system that truly benefits the American People, essentially now the Fair Tax, HR-25.

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Published by: Jabari Zakiya on Jul 15, 2011
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S TAX SYSTEMTHE RESTRUCTURING OF THE AMERICAN TAX SYSTEMCopyright 1989 by Douglas Ross [Jabari Zakiya]INTRODUCTIONThe tax system that we live with in this country is an utter failure. It fails to meet the most important criteriaa ‘fair’ taxation system would be designed to fulfill. Now, even the people responsible for its creation, themoneyed ruling class, can no longer ‘finagle’ it to meet their objectives.With the recent manipulations of the tax code, in the name of ‘tax reform’, Congress has signaled the beginning of another ‘act’ in the ongoing play of fiscal futility. But people need to understand what the taxcode is (and isn’t) to understand the meaning of this new ‘act’.Congress’s recent steps to ‘reform’ the tax code must be understood to be an admission to years of ‘screwingup’ the economic priorities of the government. It is not an admission of screwing up just the tax code, or thetax system. It is an explicit confession of the invalidity of various economic philosophies.Unfortunately, continual tweaking and modification of this present system of taxation will not deliver anysubstantial positive results. Merely tweaking something that violates Constitutional rights, economictheories, fiscal realities, human nature, and plain old common sense is doomed to continue to produce thesame old failures.Arguments against continuing the present federal system of taxation, which most Americans have beenconditioned to accept, can no longer be swept aside. These arguments have led me to the inexorableconclusion that the present system of taxation must be abolished. In its place a system of taxation that fallswithin the framework of the Constitution, that doesn’t trample on economic ‘laws’, that doesn’t ignore humannature, and doesn’t fly in the face of logic and rationality, must be instituted.Can such a system of taxation accomplish the above goals and raise the amount of revenue this governmentwill need in the immediate and long term future? The answer is an emphatic YES!What I will present is an alternative system of taxation that will allow the federal government to raise therevenue it needs in the manner least destructive to the country. It is designed to be ‘progressive’ by its nature,and adaptable to all economic necessities with minimal modifications.The efficiency and beauty of the system is derived from its simplicity. All the criteria that I deemednecessary in designing this system are derived from a few simple concepts. This will allow for the widestrange of comprehension by the people who will ultimately have to live with it — the American public.
2The Philosophy of Design and AnalysisIn order to judge something one must refer to two conceptual entities:1) the purpose of the ‘something’ that is being judged, and 2) a set of criteria which can be used to assess theachievement of that purpose. In fact, these same conceptual entities must be known in order to designsomething as well.As simple (hopefully) as this sounds, these principles are, nevertheless, widely disregarded outside of theengineering discipline. A thing cannot be judged (or designed) unless a concept of its purpose has beendeveloped. One cannot hope to ascertain if this purpose has been met unless a set of (objective) criteria has,or can be, developed by which to measure fidelity to its stated (or assumed) purpose.Therefore, in the design process, the conceptual purpose is developed, which generates a set of goals andobjectives that are to be met. The conceptual purpose would have a philosophical basis, but it should be ableto manifest this in definable goals and objectives.So, you begin with a concept of purpose, develop a set of criteria to design around and test it against, anditerate this process until some acceptable level of consistency between what the purpose is and what thedesign actually produces, is met.To develop a set of criteria to measure, or test, the design process, the set of goals and objectives derivedfrom the process above are used to develop tests that will determine if they have been met. The tests, of course, have to be relevant. Testing for unnecessary things is irrelevant, and not testing for relevant thingsis misleading.The analysis process is the reversal of the design process. Whereas in the design process you go from the ideato the concrete, in the analysis process you go from the concrete (the ‘thing’) to its generating idea.The purpose of following this procedure is to insure that you get what you want. Fidelity to the goals andobjectives of the design process must be met in the ‘real world’ in order to ascertain if the purpose has beenachieved. If you don’t get in the ‘real world’ what you say you want on paper, something has gone wrongin the process.Understanding the Present Tax SystemTo design a tax system the above process should take place as well. Except that our present system stemsfrom a political and philosophical basis that is impossible to achieve. It is replete with misconceptions andinconsistencies that make any statement of purpose fraudulent.If one analyses the present tax system from an economic perspective, with an objective eye, it will becomequite apparent there is no definable, consistent philosophy to it. It is quite understandable, however, if oneanalyses the system from a political perspective.The tax system, as it presently exists, is designed to meet certain political priorities first and foremost. It isnot primarily concerned about whether these priorities satisfy a certain set of criteria that will serve thenational interest. This point is crucial in understanding the failure of the present tax system.How can I come to that conclusion? First, let
s look at some numbers.
3Table 1.Federal Revenue from Individual and Corporate Taxes vs Total Revenue (In billions of dollars)Receipts by Source1974 1975 1976 1977 1978 1979 1980Individual Income Taxes 119 122 132 158 181 218 244Corporate Income Taxes 39 41 41 55 60 66 65Total Receipts 263 279 298 356 400 463 517Receipts by Source1981 1982 1983 1984 1985 1986 1987Individual Income Taxes 286 298 289 298 334 349 393Corporate Income Taxes 61 49 37 57 61 63 84Total Receipts 599 618 601 667 734 769 842One thing that is obvious from the above figures is that the revenue received by the federal government fromindividual taxes greatly exceeds those generated from corporate taxes. And the difference is stark.From 1974-1980 individual taxes accounted for about three times the taxes generated from corporations.Then from 1981-1987, the Reagan years, individual taxes accounted from 4.6 to 7.8 times the taxes generatedfrom corporate taxes. This is from a tax system that started out generating more revenue from corporationsthan individuals.Also, individual taxes have been steadily increasing, while corporate taxes have not; they even experienceda period of decline in the first Reagan term.What can be analyzed from looking at these figures? One thing is perfectly clear — individuals are beingasked to contribute more to the revenue base of the federal government than corporations. What peopleshould ask themselves is why is this the case, and should it be that way?
Determining Purpose
I contend the present tax system is based on political priorities over economic priorities. Those prioritiesmanifest themselves in tax laws and policies that give heavy advantages to big business and wealthyindividuals. The corollary to this is that small businesses and ‘normal’ individuals pay a higher,disproportionate amount of their wages and income into the system.This is by design. It is the implicit and explicit will of Congress to do so, for Congress has becomeincreasingly the maintainers of the interests of the few that are wealthy over the interest of the many who arenot.If this premise is used as a teleological base for the understanding of the tax system some consistency can be derived from it. In fact, you will be able to predict the essence of future tax modifications or ‘reforms’.

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