Tax Loopholes No Longer Patentable

Knowzy writes "A section of the America Invents Act disallows issuing a patent 'on a strategy for reducing, avoiding or postponing taxes,' according to Forbes. The article describes one such strategy in some detail. The USTPO has already issued 161 of these 'business method type' patents. 167 more were pending. The law only applies to future patent applications, leaving enforcement of existing patents an issue for the courts to decide."

Comments

FLAT TAX

[unixisc]

Introduce a FLAT $$$ tax - not even a percentage of one's income, just a flat $$$ amount, and call it that. No different from everybody paying the same price for a bottle of coke @ the store. Or should shops start asking customers their income, and then charge them accordingly?

Re:FLAT TAX

[Anonymous Coward]

I can't tell if this is +5 Funny or -1 Ignorant?

Re:FLAT TAX

[rtfa-troll]

How about a flat rate tax on wealth instead. Why should the ultra-rich be able to sit there not earning, not paying taxes, and just getting the benefit of everything they own whilst we have to defend their property, police their stupid legal disputes, deal with their garbage, clean up the results of their wastefulness etc. etc. etc.

Re:FLAT TAX

[snowgirl]

Introduce a FLAT $$$ tax - not even a percentage of one's income, just a flat $$$ amount, and call it that.

Right, so the person making $12,000 a year, who needs every single penny of their paycheck can pay exactly the same amount of tax that Bill Gates pays?

And what of people who have no income? Shall we drag them into jail for not paying their taxes, because they have absolutely no way to pay for it?

On second thought, your plan succeeds extraordinarily well in making being poor illegal; in fact, way much better than any of the numerous laws (like vagrancy) that local governments pass to making being homeless illegal. And then, once all the poor people are in jail, they'll never be able to afford paying their taxes then, so we can just keep them locked up eternally... or maybe we could just kill them all, since they're never going to get out of the grave we've already dug for them anyways. Then, maybe we could just make a protein paste out of them. You are absolutely a brilliant person, you are.

Re:FLAT TAX

[migla]

Dennis Moore, Dennis Moore
Riding through the land
Dennis Moore, Dennis Moore
Without a merry band
He steals from the poor. And gives to the rich
Stupid bitch.

Re:FLAT TAX

[rtfa-troll]

I'm not sure how that's relevant to my comment. This is good. They will have more wealth to pay taxes on. At the same time they will have more wealth to be happy with. This would be actively encouraged by a system in which wealth was flat taxed.

Re:FLAT TAX

[jpapon]

The person making $12,000 pays a much higher percentage of their income in sales tax than a rich person does.

And what's with this class envy nonsense? Does Buffett have class envy because he thinks the rich should pay more income tax?

Those making millions make those millions due to their own hard work, sure, but they also make them thanks to the infrastructure, security, and educational system maintained by the government, the poor, and the middle class. They should have to pay their 30+%, since they benefit from the government more then anyone else. Without government to defend them and maintain order, the rich would quickly become very poor.

Re:FLAT TAX

[Joce640k]

With a few modifications your moronic plan might work:

They should abolish income taxes (too easy for the rich to dodge) and do it all via sales tax. Rich people buy more stuff so they'll pay more. People who are sensible with their money will pay less than the people who max out their credit cards. It's all good.

Sales tax is a lot harder to cheat than income tax and having a simple tax system will save a lot of money in itself.

Re:FLAT TAX

[snowgirl]

So if that person making $12,000 a year pays $2 for a bottle of coke, Gates should pay what? $2,000? $2,000,000? Incidentally, good job with the class envy & the scare mongering.

A person making $12,000 a year is likely buying their $2 bottle of coke on foodstamps provided by the government in the first place. So, really, they're paying about $0 for a bottle of coke out of their income.

And this "class envy" that you purpose is not an imagined thing, nor an opinion. What happens to people who cannot pay taxes? Oh yeah, they rack up a bill so high that they can't pay it, and eventually either settle for something that they can pay, or end up in jail for tax evasion. So, let me ask you, if your scheme were implemented, and set at $1,000 a year, which I am entirely unable to currently pay, at what point would the government decide to just jail me for failure to pay my taxes? Or would I get a special "poor person" dispensation because I'm entirely incapable of paying the taxes because I have no income?

I mean, the $2 bottle of coke that I'm buying was bought through government funds, but I can't very well pay my $1,000 a year in foodstamps, because it's not food. Then again, if my foodstamps run out, guess what? I can't and don't buy any more coke. Of course, foodstamps also don't buy DVDs, alcohol, or new clothes... guess which items I don't buy at all? I don't hardly have the choice of not paying taxes by not using any services at all. I can't exactly exempt out of police protection in order to reduce my tax burden.

That's why the whole analogy of taxes to a contract for the purchase of physical goods fails. Physical goods can be bought in varying amounts according to affordability, while social programs are often provided to those people who can least afford to actually pay for those services. Providing social services only to those people who can best afford to pay for those services would kind of defeat the purpose of helping the poor... because only the rich would be getting the benefits.

Re:FLAT TAX

[slippyblade]

Except that poor people pay much more in sales tax as a percent of income than a rich person. Sales tax is on a regressive scale. The more an item costs, the lower the sales tax on the item is. Cars are a good example. Where I live you pay, for example, 9% sales tax up to $5000. Anything over that $5k is taxed at 2%. So if I buy a 5000 car, I pay 9%. But if a rich person buys a $100k car he pays a SIGNIFICANTLY lower overall percentage. There are LOTS of nifty things like that.

Re:FLAT TAX

[TheVelvetFlamebait]

No, Bill Gates should pay absolutely nothing, because if Bill Gates had attempted to make his empire while paying a flat tax, he would be now flat broke, and most probably swinging from roof beam by the neck.

Re:FLAT TAX

[snowgirl]

What world do you live in?

In the United States at the end of 2001, 10% of the population owned 71% of the wealth and the top 1% owned 38%. On the other hand, the bottom 40% owned less than 1% of the nation's wealth.

Re:FLAT TAX

[snowgirl]

I like the cut of your jib, send me your resume and I can get you a job writing for Fox News.

Since when does Fox News argue for poor people? I would make a horrible contributor at Fox News, particularly owing to being a member of the Socialist Party USA.

Re:FLAT TAX

[Chrisq]

This is Slashdot. Don't you know that the rich deserve every penny that they have, and the poor CHOSE to be that way?

Right, so they deserve to be imprisoned if they don't pay the $13,000 each in tax that the flat rate would have to be to maintain current levels of revenue. The above figure assumes that children are also paying - after all they did decide whether or not to be born into a wealthy family.

Re:FLAT TAX

[Daniel Dvorkin]

I'm saying that those who expect people w/ higher incomes to pay more have class envy, regardless of what they're actually earning. It's the attitude that qualifies it.

Or maybe you don't understand other people's thinking nearly as well as you think you do.

Statistically, it's been demonstrated that the top 5% of all income earners pay 50% of all taxes, while the bottom 70% pay less than 5% of all taxes. And it's not even like the top 5% has 50% of all the income/wealth, however one wants to see it - it's more like 20%.

Any time you start a statement with "Statistically ...", you'd better be ready to back up your claims with something more than a bunch of hand-wavey numbers. Speaking as a statistician, I'd like to see your sources and your methodology. If you have any.

Also, your statement that without the government defending them, the rich would quickly become poor, you're suggesting that the government is/should be an extortion racket, like the mafia.

Um, no, he's describing the way the world works. Without effective government, out-and-out extortion rackets -- with all of the government's power and ruthlessness, but without even its minimal answerability to the people -- take over. One thing that liberals and conservatives can generally agree on is that one of the main purposes of government is to keep people who want to kill you and take your stuff from doing so; and obviously, the rich have a lot more to take. Are you seriously arguing with this proposition?

Re:FLAT TAX

[Registered Coward v2]

With a few modifications your moronic plan might work:

They should abolish income taxes (too easy for the rich to dodge) and do it all via sales tax.

Sales tax is a lot harder to cheat than income tax and having a simple tax system will save a lot of money in itself.

Not really - what do you tax - the sales price or the value, such as the MSRP? People would just use creative ways to delink the selling "price" from the revenue received for big ticket purchases.

Re:FLAT TAX

[snowgirl]

Right, no one could possibly live off of $1000 a year. You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income. I don't live under a bridge (because I have carrying friends and family, who wouldn't let that happen), and get food entirely through foodstamps.

Your solution sounds so great, because it is so simple, but fact is that it will not actually work. It fundamentally punishes people for being poor, which is generally beyond their power to control. And it completely discards this idea that society has called "charity". Poor people's lives suck bad enough, why do you have to drop the same burden on them as those who are rich?

And we should reward people for hording cash like dragons? You do realize that people grabbing at cash any which way they possibly can has been the cause of every bubble, depression, and recession that we have ever had, right? It's why we can't trust employers to treat their employees better than slaves, and provide a safe work environment without oversight. Really, why should we be encouraging people to be greedy heartless bastards? Rich, sure, that's fine, but it bring with it social responsibilities to the society that has rested such confidence with an individual.

Re:FLAT TAX

[snowgirl]

GP said "income/wealth," but meant "income," since we are taxed on income, and not on our ability to save and invest money.

Capital gains aren't taxed? Funny, I seem to hear about the rich complaining about that tax a lot...

Re:FLAT TAX

[unixisc]

I didn't get into whether the tax should be income, wealth or sales tax. For sales tax, a percentage is unavoidable, but if one just implements the principle that taxes are the membership fees for citizenship, then the flat rate is the way to go. But I'm not completely against the sales tax either. But I can see all Leftists recoil @ the idea of misers dodging the tax.

Re:FLAT TAX

[mwvdlee]

Please tell; how high do you imagine such a "flat $$$ tax" would be?

I can't imagine any flat tax low enough to be reasonably asked of minimum wage workers and still be high enough to fund an entire country.
The coke bottle has the same price, but you can just choose to buy a cheaper brand or different type of fizzy drink.
Will people be able to pay the tax of a cheaper government brand or a different type of government altogether?

Re:FLAT TAX

[El Torico]

Because you implied that their wealth isn't benefiting society at all, which is ridiculous. In fact what your idea would encourage is people keeping their wealth off the books, which is only easy if it's in the form of cash or precious metals, in which case it does do absolutely nothing.

Oddly enough, that's what's currently happening. Anyone who does have cash is holding on to it or investing in gold.

Re:FLAT TAX

[mwvdlee]

So if that person making $12,000 a year pays $2 for a bottle of coke, Gates should pay what? $2,000? $2,000,000?

Gates would pay $2, the poor person would drink a $0.05 glass of water.
Nobody is forcing you to buy coke bottles, but government IS forcing you to pay tax.

Re:FLAT TAX

[mwvdlee]

How about a fixed percentage sales tax then? Not "more expensive, less percentage", but every product has the same percentage of tax. Perhaps give living essentials (i.e. milk, bread) a lower tax product, but anything not strictly essential to stay alive a fixed tax.
This is how most of europe handles sales tax already.
In my country (Netherlands) I pay about 20% on luxury goods (whether it's shoes or a jet airplane) and 6% on essential goods (which doesn't even include luxury food articles). There are some additional taxes for legal drugs like alcohol and tobacco, but that's pretty much it. AFAIK, most countries in europe have a similar system with 2 or 3 levels of sales tax.

Re:FLAT TAX

[TheRaven64]

You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income

I think this sentence needs some clarification.

Re:FLAT TAX

[jonbryce]

How do you value wealth? A lot of it is very subjective.

Re:FLAT TAX

[mcgrew]

So if that person making $12,000 a year pays $2 for a bottle of coke, Gates should pay what? $2,000

Actually, that's how it is now. Rich people pay $5 for a cup of Starbucks coffee, the middle class $1 for McDonalds, the poor five cents for Folgers.

The rich buy a Lamborghini, middle class a Chevy, the poor get a ten year old beater (or take the bus).

I can't tell if you're trolling or just stupid.

Re:FLAT TAX

[mcgrew]

Those making millions make those millions due to their own hard work,

Many do, many don't, but all rich people's wealth was generated by others' labor. Sam Walton could not have gotten rich without an army of low-paid workers. That idiot Donald Trump could have never become rich without being born into wealth.

Re:FLAT TAX

[Your.Master]

Price discrimination is not illegal and it's not uncommon. In cases where fixed costs dominate replication costs, it can be necessary to be profitable in a competitive marketplace.

Usually it doesn't happen for a bottle of coke at one store, because that's cheap and the store can't verify your wealth (I've heard of "food stamps" in the US but I'm not familiar with what they are really or if they apply here), but the store down the road which markets to people with higher salaries often has more expensive bottles of coke...

Re:FLAT TAX

[mcgrew]

With taxes, they don't get to pick that, but to base that on either their income or wealth is a disincentive for them being either high-earning or rich.

That's the dumbest thing I've seen all week. "What? I can't have ten bottles of coke, I can only have nine? Screw that, I'll go thirsty!"

Unfortunate that so many people are idiotic enough to believe that stupid lie.

Re:FLAT TAX

[rtfa-troll]

No I didn't. At most I implied that their wealth was benefitting society relatively less than the equivalent amount of wealth in the hands of poorer people, but that point of view would be irrelevant to what I said. What I actually said was that these people cost society much more than poor people. What I would go on further to say is that they aren't mostly willing to pay their way with Warren Buffet appearing to be an honourable exception.

Generally, however; I'm not totally convinced by any flat tax. There is real logic to having rates which vary according to e.g. income or wealth levels. However, the original post seems to suggest that a flat rate of tax would be obviously fair. I'm suggesting that there are other positions, closer to taxing wealth, which would be much fairer.

Re:FLAT TAX

[rtfa-troll]

The rich actually spend proportionally much less. E.g. if you have your own estate, with your own servants and your own cooks, you have food cooked for you based on local produce. This makes a meal which would cost hundreds of dollars per person but, since it's all your own property, you don't buy it and so you don't pay sales tax.

If you or I go on holiday, we go to some resort where we pay for everything; every little bit of water you use ends up being taxed. When Richard Branson goes on holiday he flys in his own jet to his own island and the only sales taxable expense is his jet fuel. When his rich friends do the same they go to his island sometimes, and he comes to their islands in exchange other times. In a sense this is completely fair. I would get annoyed if you tried to tax me for having friends over for dinner rather than going to a restaurant, but the scale of the thing means that in the end, the really rich show much less income compared to the resources they use than you or I and pay even less tax.

Re:FLAT TAX

[snowgirl]

You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income

I think this sentence needs some clarification.

Over the previous year.

Re:FLAT TAX

[TheRaven64]

Because...

(Although, if you display this kind of communication skill on your CV and in interviews, no further explanation is necessary...)

Re:FLAT TAX

[unixisc]

Stupid analogy. It's more like a person who earns above a certain threshold finding himself in a tax bracket that forces him to make a bunch of choices:

1. Quit that job, and go for a less stressful, lower paying one

2. Move your money/business offshore

3. Close down the business if #2 is unaffordable as well

You're also underestimating the magnitude of the effect of taxes. If taxes were just 10%, which your analogy seems to imply, there'd not be a problem. The reason it is a problem is that it's ~30% for the bracket we're discussing. And that's just federal - I'm not even counting state, local and other taxes.

Re:FLAT TAX

[unixisc]

Different stores can have different prices for the same item. What I'm questioning is whether any particular store can legally charge different prices to different people based on anything - their income levels, race, ethnicity, et al. Yeah, 2 different stores, even belonging to the same chain, can vary in price. But if I and another customer @ the same shop are buying the same quantities of the same item, is it legal to give me a better price than the other customer?

Re:FLAT TAX

[snowgirl]

Right, no one could possibly live off of $1000 a year. You know, looking back on it, if you exclude foodstamps, I've earned not a single penny in income. I don't live under a bridge (because I have carrying friends and family, who wouldn't let that happen), and get food entirely through foodstamps...

You've never earned anything other than food stamps? Seriously? How much longer do you expect your "carrying" friends and family to continue doing so?

As noted below, there was information missing. The lack of income comment was over the previous year. I have earned money before, and I've paid more well than my fair share of taxes. (How have I pay more than my fair share? Well, I had the opportunity for a full refund, and decided instead to not file taxes as my income had not exceeded the amount that makes filing mandatory. What you read is correct, I was below the poverty line and still paid my goddamn taxes. I walk the walk, not just talk the talk.)

I think there was a system in the older times prior to currency, where people exchanged goods and services in exchange for other goods and services directly. As it turns out that living with a brother and his bachelor roommates presents plenty of opportunity for one to justify the charity provided by providing cleaning.

As also noted, I am currently applying for disability, as I am unable to work. (Yes, I've tried.) That is why I lack any income. It's kind of difficult to have an income, when one is unable to work. (But you said you're cleaning to earn your room and board; no, I said it justifies my charity, not that it is sufficient to fully offset the monetary value that I am receiving.)

It amazes me that people in America love to jump to the assumption that anyone receiving government assistance is simply inept and lazy. As if every person earns their rightful place in society of their own achievements. As if Bill Gates were born in a cave with parents who use stone tools, yet managed to claw his way to the top reinventing everything about math and computers himself to produce Microsoft DOS... what am I taking about? Even "stone tools" is an advantage that many homo sapiens may not have even had. ... or wait, maybe there's a remote possibility that Bill Gates was born into a family, where the father was a noted and well respected lawyer, and thus born with a silver spoon in his mouth. I mean, it just wouldn't be the American "conquer all" story that we so love if he were born into the top 10% of society, and clawed his way up to the pinnacle. I mean, because likely larger than 50% of the people are born into families that earn under the mean income of the society, so we obviously want to look at someone born into that disadvantaged substrate and yet managed to claw their way to the top... except, you know, they're exceedingly rare, like less than 0.01% of those born into the under 50% population, so we simply hold this dangling carrot in front of the laboring masses with sweat poisonous words of "you can get there, too! just try harder!" All the while knowledgeable that it is simply an impossibility that each person who works every day to the bone could not possibly make it into the top 10% of the population.

But then, Americans do so love that mirage in the distance... after all, we sell it like it's bottled water, and the Americans just lap it right up. "I'm going to work hard so I can be a billionaire!" Keep dreaming Jimmy... keep dreaming.

Re:FLAT TAX

[snowgirl]

Because...

(Although, if you display this kind of communication skill on your CV and in interviews, no further explanation is necessary...)

... what purpose do you have for knowing the precise reasons behind me not having any income? Perhaps I'm a housewife, who doesn't work. Perhaps I'm a disabled person, who is unable to work. The reason bears little relevance to my point at hand, that a flat value tax applied universally to all citizens would exceed the income of some individuals.

That you would insist that you have a right to pry into my life and have me justify the reason why I don't have any income is kind of offensive. (Yes, I explained it elsewhere, but they didn't demand it, as if it were a demonstration of my hireability.)

Of course, truth is, that I've received two separate jobs from two separate multinational corporations that are leaders in their businesses; one of which solicited me directly for work, and the other of which was arranged through a headhunter, but for which, I was hired with a 6-digit yearly wage from only a phone interview. I am capable of being hired, and quite valuable... I am simply unable to work due to a disability.

Re:FLAT TAX

[prefec2]

The taxes are not there to pay the price of something, they are there so everyone in charged according to his or her abilities. People who get more money can pay more of that (in percent) than the poor. It is like the health system (in Europe) everyone with money pays according to his or her income and everyone gets the same insurance totally independent from the money they give. this is what a society does when they care for each other. The strong help the weak.

And the tax system is modeled accordingly. However, in the past decades politicians added loopholes so that the rich can evade paying taxes. Even that Buffet guy said that.

A flat tax is not the solution. The solution is the end of loopholes. If you have a flat tax and loopholes than this results in more taxes for the poor and less taxes for the rich. And you do not want that. Even if you are rich. Because it is stupid to destroy the community which guarantees that the money you own are worth anything.

Re:FLAT TAX

[gomiam]

I don't know about the cost of goods, which certainly can't be policed like that. But yes, there can be proportionality on taxes, fines and the like. Finland does it and they don't seem to be doing too bad.

Re:FLAT TAX

[jpapon]

Well, they're not taxed as income.

Re:FLAT TAX

[jpapon]

But that's true whenever anybody pays for anything. When you buy, say, a car, you are automatically paying a much higher percentage of your income on the car than Buffet is.

That's exactly my point... The poor pay a higher percentage in sales tax, so the rich pay a higher percentage in income tax. Nothing wrong with that...

And whoever said anything about Buffet having class envy - I'm saying that those who expect people w/ higher incomes to pay more have class envy, regardless of what they're actually earning. It's the attitude that qualifies it.

Read what I wrote again, and read what Buffett wrote. You're saying that Buffett has class envy (because he thinks the rich should pay more in taxes). Regardless, stop with this class warfare nonsense. It's not class warfare, it's not punishing the successful, it's about making everyone pay their share of taxes. When Warren Buffett pays a lower % in taxes than his maid, the system is clearly broken.

Re:FLAT TAX

[rtfa-troll]

I don't see the difference b/w charging people based on their income/wealth, vs Lenin's 'From each according to his abilities, to each according to his needs'.

Did you know that Lenin also recommended that people breathe regularly and drink fluids at least occasionally. Think about it.

Re:FLAT TAX

[gomiam]

No, we aren't talking about paying for identical thinks. That's completely beside the point. If I win 1M$ a year and you win 1K$ I will certainly be able to buy things that you can't even after paying taxes... unless my taxes amount to 999K$ and yours amount to 0$, which _nobody_ is talking about. So your premise is _wrong_.

The kind of taxes we are talking about don't apply to commerce goods, because it's very difficult to let a store know how much your last year income was.

Anyway, let's suppose we set a flat tax: everybody pays the same. There's a small problem though: there will be people who can't get ahead (due to disability, for example) after paying that flat tax: yes, it's going to happen because the maintenance needs of the administration (common things like roads or police) aren't that low. I suppose you don't consider letting them to die by the roadside an ethical option, so part of that flat tax rate will probably used to support them. Know what? Suddenly your touted flat tax isn't flat any more: whoever gets _any_ kind of relief charged to that flat tax is effectively paying less taxes. So what's the difference between directly applying a somewhat proportional tax and applying a flat tax high enough that lower income people will get rebates through that same tax? None whatsoever: you end up having people pay effectively less than other people, but at least they don't have so many reasons to whine about richer people having it even easier, so proportional taxes may actually help have a more stable society.

And there's no "socialism", "comunism" or any other "-ism" needed. It's simple math. Unless, of course, you'd rather have the poorest portion of the nation starve. In that case, there are some psychological problems you should worry about before worrying about taxes.

Re:FLAT TAX

[GameboyRMH]

You can't use logic on this type. One told me that he saw no reason Bill Gates should pay more taxes, in dollars, than a struggling single mother.

Re:FLAT TAX

[Muad'Dave]

As also noted, I am currently applying for disability, as I am unable to work. ... you're cleaning to earn your room and board...

Sorry to hear you're out of work and injured.

Those two sentences might come back to haunt you in your attempt to qualify for disability. It sounds like you're able to perform some amount of work, just not in your chosen profession.

Re:FLAT TAX

[GameboyRMH]

Donald Trump even manages to stay rich despite his own best efforts to go broke.

(I've probably shown you this already mcgrew, but everyone else take a look)

http://www.cracked.com/blog/10-stories-about-donald-trump-you-wont-believe-are-true/

Donald Trump has the financial history of a crackhead.

Re:FLAT TAX

[Attila Dimedici]

So, how often do you plan on taxing that wealth? Say, somebody has $10 million, are you going to tax it every year? At what tax rate?
The problem with taxing wealth is that that makes saving impossible for everyone, even those who do not have very much.

Re:FLAT TAX

[91degrees]

Nobody is forced to buy a bottle of coke.

Re:FLAT TAX

[Miamicanes]

It's legal, but it's hard to think of any meaningful competitive retail environment where you could actually get away with charging more to a subset of customers unless you somehow managed to provide more value than competitors charging less. If I want to charge wealthy people $5 for a can of diet Coke, but sell the same can to poor customers for a nickel, and the store next door sells it for a dollar, chances are that most of the people I'd try to charge $5 will go next door and buy it there instead.

For an example of a real company that voluntarily offers lower prices to a poorer group of buyers (not necessarily verifying their income, but relying on the fact that they're statistically likely to be near the bottom of their lifetime salary figures), just look at Microsoft and student discounts. A registered college student can buy a copy of Visual Studio Enterprise Edition for approximately what it costs a normal person to buy a copy of Microsoft Word from Newegg, In this case, part of the reason they can get away with charging radically higher prices to normal customers is the fact that VSEE's normal customers tend to be enterprise customers who think it's sane to go through 5 levels of purchasing approval so an employee can get a $300 RAM upgrade that could be expensed for $50 if they just bought it at CompUSA at lunch on the company credit card. American "Enterprise" customers are a strange beast that in some ways would have even had Soviet bureaucrats shaking their heads in disbelief (the Soviets put up with it because they had no choice, but even they would have had their minds blown to see private entities voluntarily adopting the same practices).

Re:FLAT TAX

[91degrees]

Because it's been tried. It doesn't work. Even if any percentage of income is based on a flat tax, you find people protesting.

If the rich object to paying the amount of taxes they pay, they're entitled to give away their assets and reduce taxes. The poor don't have that option.

Re:FLAT TAX

[Bengie]

The whole issue is that the rich are becoming richer must faster than the rest of the economy.. aka middle/lower classes.

As the rich gain money, the middle class is getting gutted, which means you have fewer and fewer people that can afford "luxury" items. As less and less money moves around and demand drops, the value of money falls out and the cost of living goes up. As demand drops, jobs start to disappear. More and more middle/lower are jobless.At some point, no one, other than the rich, can actually afford anything.

Now you're left with this top heavy system where you have rich people with all the money, no middle class, some workers, and a ton of unemployed.

Our economy is a chicken-and-the-egg problem. The lower class supports EVERYTHING. But we have too many people. So we have a middle class that makes luxury items and services. The middle class is its own biggest demand. As the middle class goes away, demand drops. Our entire economy is based around the middle class. The middle class needs money to create demand, but if the rich keep taking all the money, there goes the middle class and demand. Without demand, there are no jobs.

Essentially, the middle class circulates money with-in itself. The rich can "leech" off of the surplus. When the rich leech more than the surplus, the economy suffers.

Another way to look at it, is interest in a savings account. Say your economy is a savings account and it's worth $5 trill. Your savings account gains 4% interest per year. If everything was balanced, the rich would skim 1-2% off of that interest. The economy would continue to grow and the rich would grow faster than the rest because they're sharing 2% with a small amount of people. But when they start taking 4% out, suddenly the economy stops growing. The amount that they skim off is out of whack with the growth. Then they get more greedy and start taking 5%. Now you have a decline.

The rich, as a whole, are too greedy. They want to make money more, so the lay off workers. But because they lay off workers, the reduce demand. So their company makes less money because demand is down. So they lay off more workers again, and again reduce demand, which causes them to lay off more workers..... see a pattern?

Re:FLAT TAX

[Muad'Dave]

How about letting them trade not being able to vote for tax relief? Let's re-institute the poll tax! ~sarcasm

Re:FLAT TAX

[jpapon]

... that was my point. The rich depend on the government, the poor, and the middle class much more than the government, poor, and middle class depend on the rich. It's an imbalance that should be fixed.

Re:FLAT TAX

[BigDogCH]

"(Although, if you display this kind of communication skill on your CV and in interviews, no further explanation is necessary...)"
"what purpose do you have for knowing the precise reasons behind me not having any income?"

He enjoys beating down on the poor, that is clear from his stance and enjoys hearing of their misery. He also wants to justify to himself that it could not happen to him. Nothing he has said shows any insight or understanding; he instead feels better about himself and his failures by learning about others who he feels are doing worse. In a job interview, I would hire you, not him. That elitist attitude doesn't fly everywhere...I am not sure why it is accepted anywhere. With that attitude, I am sure he has friends lined up that would help him out :)

Your points on taxes were well written and common sense by any reasonable standards. Unfortunately there is a minority of ignorant and vocal people on the internet and media and politics making it seem like a reasonable argument exists in beating down the poor even more. This is going to end. The only defense they now have is to call it "class warfare" when indeed they are the ones waging war based upon class. The rich do have to pay more, as they are the ones benefiting most from the infrastructure and services this country provides. It is inevitable.....no need to argue with those who cannot see it. Thank you for the comments.

Re:FLAT TAX

[91degrees]

Even if any percentage of income is based on a flat tax

Gah! meant tax revenue.

Re:FLAT TAX

[Muad'Dave]

There was a big stink years ago about the airlines and/or some of the major online retailers trying 'demographic-based pricing'.

I experienced this just the other day. I went to a local restaurant supply store and bought a bunch of stuff. Since I was a first-time customer, he gave me an instant 10% discount. No one else in the store would've gotten the discount on those or any other items even if they were first time customers as well. I was just more charismatic, I guess. :-)

Re:FLAT TAX

[alexander_686]

Wealth Tax is based on how much stuff you have. Think property tax. The bigger (in $$) the property, the more taxes you pay. It does not matter if you made money on the property.

Capital Gains is not a wealth tax. You only pay after you recognize (i.e. sold) the property.

The difference in these 2 types of taxes can have a huge impact.

Re:FLAT TAX

[PopeRatzo]

How do you value wealth? A lot of it is very subjective.

Price-to-market accounting.

The idea of taxing wealth instead of income is very interesting.

Did you know that .5% of the population owns $46trillion in wealth? A 5% tax on wealth would pay off the debt and provide health care and a pension for every American over 10 years.

Total US wealth went from about $25Trillion in 1999 to $54 Trillion in 2009 and currently over $70 Trillion.

How much has your wealth increased since 2009?

Re:FLAT TAX

[kevinNCSU]

Without government to defend them and maintain order, the rich would quickly become very poor

Ah yes, just like ye olden days, where the rich nobles cried out for strict national governance to better protect them from the peasants because without a stronger government to protect them what was a rich man with resources, arms, and mercenaries to do?!

Re:FLAT TAX

[Attila Dimedici]

Except that we only have Warren Buffett's word for that (he has not released his tax returns). When we look at the numbers from the IRS, we discover that the high earners do indeed generally pay a larger percentage of their income (even when capital gains are calculated in) than those who earn less.
The problem with the original poster's idea of a flat amount that everyone pays is that if it is set at an amount that everyone can pay, it does not add up to anywhere near enough money. The federal budget is somewhere around $3 trillion a year. That means the tax bill in order to get a balanced budget would be about $10,000 for each American (including children). If we were looking to just match current income tax revenue the tax bill for each American (still including children) would be about $3,000. For a balanced budget that would mean a tax bill of $40,000 for a family of four. For a tax that just matches income tax revenue it would mean a tax bill of $12,000 for a family of four. Considering that the median household income in the U.S. is somewhere in the vicinity of $50,000, I think it is pretty obvious that there are a large number of people who would be unable to pay the tax..

Re:FLAT TAX

[PopeRatzo]

Statistically, it's been demonstrated that the top 5% of all income earners pay 50% of all taxes, while the bottom 70% pay less than 5% of all taxes.

That's only true if you conveniently leave out payroll taxes, which now amount to well over 40% of all Federal tax revenues.

And the people at the bottom pay a much higher percentage of payroll taxes than those at the top.

Before you ask, here

Re:FLAT TAX

[GameboyRMH]

Yeah nobody's forcing you to buy food or shelter, or any of the things practically required to be employed (like communications or transportation), or any of that basic stuff that eats up almost all of your income if you're poor. Nobody's forcing you to live, you can just curl up in a gutter and die. See, no force!

Pure capitalism is the most horrific of all economic systems, because it allows for any of the horrors of any other system, as long as it's done by leaving it as your only feasible option rather than forcing. What other systems do with jackboots, an angry frown and open hostility, capitalism does with a business suit, a pearly-white smile and a liberal application of the just world fallacy.

This is why capitalism should be well-regulated. You don't want to be anywhere near pure capitalism. It's like nuclear energy: A powerful force can be good for us with oversight and moderation, or can fuck up our shit worse than anything else if we are so much as negligent.

Re:FLAT TAX

[Attila Dimedici]

You are completely disregarding the fact that the federal government is not the only government authority that taxes people. So while $1,000 is not that big of a bite for most people with a normal income, the tax bite would be considerably more than that when you factor in state and local taxes. Additionally, there are nowhere near 200 million people in the U.S. with a "normal" or higher income. The median household income for the U.S. is around $50,000 and there are fewer than 120 million households in the U.S..
Additionally, considering that the current U.S. budget is in the vicinity of $3 trillion dollars, you are looking to reduce the Federal budget to something around 10% of its current state. When one considers the fact that reducing the amount the budget increases by 1% is considered a big deal by politicians, why don't we just figure on running our country on tarriffs on extraterrestrial imports?

Re:FLAT TAX

[mcgrew]

No, the poor man doesn't shop in the same stores as the rich man, nor does he buy the same things. Your premise is based on a rich man's fantasy; no different that the poor man's fantasy of winning the lottery.

Re:FLAT TAX

[navyjeff]

I'd be interested to see any reference on those figures, if you have one handy.

Re:FLAT TAX

[GameboyRMH]

Still inherently regressive. This is a fact you can't escape with sales taxes. See this post:

http://slashdot.org/comments.pl?sid=2435108&cid=37444804

Re:FLAT TAX

[GameboyRMH]

Sales taxes are inherently regressive by their very nature, no matter how you play with the math. See here:

http://slashdot.org/comments.pl?sid=2435108&cid=37444804

Re:FLAT TAX

[Anonymous Coward]

Your logic applies to the 40-50% of Americans that pay NO federal income tax, not just the rich. How many of us know people that have a relatively new car costing around $30k+ and they qualify to pay no federal income tax and get EIC making money when they file federal taxes. I know quite a few. I am driving a 13 year old used car I got from Craigslist and paying full price out of pocket (in state tuition though) for two kids to go to college because I make "too much money" according to the government. Why should I bust my ass to get a higher education and then bust my ass in time and effort to get ahead in this country and in my job working 60+ hours a week when I could just about sit at home or work a non stressful part time job in retail and let others pay for things for me. Does everyone have a natural right to have a smart phone, a 42in or larger TV in their house, and a car newer than 2 years old? Take a survey of those that qualify for EIC and I bet almost all of them have at least two of those things and those that do not qualify for EIC are paying for them.

Re:FLAT TAX

[jonbryce]

And there are lots of interesting things you can do with trusts and so on to reduce the market value of an asset. I see people do it a lot with things like discounted gift trusts to reduce inheritance tax, which is essentially a wealth tax you pay on death.

Since you ask, my wealth has increased by about £20,000, which wouldn't even be big enough to be a rounding error on the accounts of some of the richest people around.

Re:FLAT TAX

[garaged]

And the current general problem is people save way too much, rich people I mean.

You dont need to save that much if you have a working health and pension system, and we have enough money in the world to do that, even in most 3rd world countries

Re:FLAT TAX

[GauteL]

"Sorry to hear you're out of work and injured.

Those two sentences might come back to haunt you in your attempt to qualify for disability. It sounds like you're able to perform some amount of work, just not in your chosen profession."

You are jumping to conclusions. There are lots of types of disabilities, both physical or mental which make it possible for you to clean a house without being able to make a living as a cleaner.

If you're missing an arm you are not going to make a living as a cleaner without some form of government subsidies. You can still clean your own house, just slower than all the cleaners a for-profit cleaning company would hire.

For the record, I have absolutely no idea why Snowgirl can't work for a living, but I wouldn't like to jump to conclusions.

Re:FLAT TAX

[silentcoder]

Lenin's 'From each according to his abilities, to each according to his needs'.

That was Marx, not Lenin - and that's a (common) misquote, the proper quote is a little more detailed actually...

Just how much do you need to advertise your ignorance ? Really, just shut up because you are embarrassing yourself.

How can I put this in terms you'll understand... erm... if you make these statements down at the pub and the rednecks start laughing - they'll be laughing AT you, not WITH you - even THEY aren't stupid enough to think your ideas are good... in fact, until today I never would have thought ANYBODY could be THAT stupid.

When most rightwingers talk of a flat tax they mean a flat percentage regardless of income... you're the first person in HUMAN HISTORY who can't figure out that a flat SUM would be fucking STUPID !

Re:FLAT TAX

[silentcoder]

It is legal, and done. Usually it's done in the name of charity in fact. KFC here in my country has a promo on at the moment where if you buy a meal over a certain amount they donate a meal to charity. Effectively - they are charging me full price, and giving the same product to somebody else for free (based on income) - not only do they do so legally, they do it as a marketing tool. The idea being that when I choose where to get take-out I may say "I would rather go to KFC and feed somebody else who is hungry as well as myself tonight".

It's not quite the same product with two prices at the counter but the effect is identical - it's merely a matter of execution. Having the same product differently priced at the counter would be a massive overhead of enforcement and calculation and could open them to complaints of discrimination. Donating the product to charity while charging me full price (or offering some charitable discount to some people) is not only legal but quite common.

Nobody has every complained when you discriminate IN FAVOR of the needy. That's what charity MEANS.

Re:FLAT TAX

[khallow]

Those making millions make those millions due to their own hard work, sure, but they also make them thanks to the infrastructure, security, and educational system maintained by the government, the poor, and the middle class. They should have to pay their 30+%, since they benefit from the government more then anyone else. Without government to defend them and maintain order, the rich would quickly become very poor.

If all the rich did was take, then you might have a point. But those people also employ other people and provide goods and services that society wants.

Re:FLAT TAX

[mcgrew]

A few years ago they were advertising a book he wrote about how to get rich. What would anyone born into wealth know about getting rich?

What was that line from the last election, "born on third base and thinks he hit a triple"?

Re:FLAT TAX

[Attila Dimedici]

I disagree completely. The current problem is a result of people NOT saving enough. The savings rate in the U.S. was much higher in the 50s and 60s than it is today. If people were not so badly overleveraged, the financial crisis would never have happened. People should not need to borrow money to buy a car, they should have sufficient savings to do so out of thier savings. While there may be occassions where the financially prudent thing to do when buying a car is to finance it, ideally one should not be in a position of needing to finance it.

Re:FLAT TAX

[jpapon]

I know you're being sarcastic, but most if not all revolutions since the French revolution have been about the poor deposing the rich. So yes, government does protect the rich from the poor, in the sense that they maintain order and prevent a revolution. Sure, if you look back further to feudal times you could argue that the rich didn't need government because they could protect themselves with their resources and mercenaries...

The point is, the government protects the rich from the poor just as much (or, in the case of the USA, more) than it protects the poor from the rich. To state otherwise is to argue that popular revolution is no longer a possibility.

Re:FLAT TAX

[nschubach]

It also discourages people from buying houses. It encourages business to buy up houses and charge people rent... if they can profit from your rent over the taxation. It discourages people from saving for retirement, or saving at all. Hopefully you have a way for those people to deal with the tough times?

Re:FLAT TAX

[shentino]

Price discrimination, as with all things, is illegal if the government says it is.

That's the very definition of "law".

Re:FLAT TAX

[mxharlow]

Since most of the patentable tax strategies have to do with federal income tax I'll keep my comment exclusively to that tax. In 2010 a single taxpayer filing a federal Form 1040 who made $12,000 from wages would owe $266 in taxes. He or she would be entitled to a refundable making work pay tax credit of $400. The tax payer would receive a net payment from the federal government of $134. They would have a federal income tax rate of -1.12%

Re:FLAT TAX

[ILongForDarkness]

So what we need is poorer people to give the wealth too. I know let all of Haiti in and give them say 200k each of Scrooge McDuck's money to spend on happy meals.

Re:FLAT TAX

[rtfa-troll]

So, how often do you plan on taxing that wealth? Say, somebody has $10 million, are you going to tax it every year? At what tax rate? The problem with taxing wealth is that that makes saving impossible for everyone, even those who do not have very much.

Since I would have a vastly increased tax base, I'd end up taxing it at a much lower rate. The typical person would end up with taxes much lower than they pay today, since a big bunch of rich people who don't currently contribute much would end up having to contribute.

Re:FLAT TAX

[nschubach]

What your argument ignores is that the rich will likely buy more items. On a one-to-one comparison... sure. But the rich will buy 3+ cars, more than one house, etc. where the poor will likely make due with one. Putting a lower tax/no tax on staple foods helps negate the disparage you mention.

Re:FLAT TAX

[GameboyRMH]

That doesn't affect the fact that the sales tax is inherently regressive or that the poor man will have to pay a much larger share of his income on just the basic necessities. This is the main problem.

The rich man could survive on the same things a middle-class person does quite comfortably. Whatever he buys beyond that is a completely optional luxury, and it's up to him whether he's going to save/reinvest most of his money or live like MC Hammer.

Re:FLAT TAX

[Attila Dimedici]

No, you would be taxing it at an infinitely higher rate. Currently wealth is not taxed, only increases in wealth. You did not answer the most important question, how often would you tax wealth?

Re:FLAT TAX

[PPH]

But if I and another customer @ the same shop are buying the same quantities of the same item, is it legal to give me a better price than the other customer?

Yes. I have my little 'club card' that gets me a posted discount. Plus, I get an additional discount based upon some algorithm in their computer whenever I scan my card.

It is illegal to discriminate based on a defined group of protected classes such as race, religion, gender, etc. But pretty much everything else is OK.

Often, poor people pay more than rich folks because poor people have to shop in their neighborhoods or along public transportation corridors*. Poor folks are a captive market to a much greater extent than the rich. Rich folks just jump in the SUV and drive to where the sales are. Retailers know this and adjust their prices to retain their market share.

*One of the major travesties in many public transportation systems is the influence businesses have over their planning to ensure that their customers remain captive.

Re:FLAT TAX

[SleazyRidr]

(How have I pay more than my fair share? Well, I had the opportunity for a full refund, and decided instead to not file taxes as my income had not exceeded the amount that makes filing mandatory. What you read is correct, I was below the poverty line and still paid my goddamn taxes. I walk the walk, not just talk the talk.)

I'm sure the rich people are very happy to get your contribution. Maybe they'll send you a thank-you letter.

Re:FLAT TAX

[rtfa-troll]

No, you would be taxing it at an infinitely higher rate. Currently wealth is not taxed, only increases in wealth. You did not answer the most important question, how often would you tax wealth?

A lower rate than current income tax of course. I didn't answer the question because it's a stupid question. If it was done daily it would be done at approximately 1/400th of the value from if it was done yearly. Unless someone could come up with a demonstrably better idea I would do it according to what the tax collector would tell me would be most efficient; judging from trends worldwide that would probably be monthly.

N.B. there is no implication in my scheme that overall tax reciepts should change. Taxation need neither rise nor fall because of this.

Re:FLAT TAX

[SleazyRidr]

I think you're missing something: the rich person does indeed get a lot more from his government than the poor person.

What does the poor person get from the government? Some food standards so people can't sell him poison and tell him it's food. Some labor regulations so when he goes to work he gets treated fairly... a few other things.

What does the rich person get from the government? Well, the rich person has a lot of stuff, so benefits a lot from the police force making sure no-one steals it. If the rich guy is involved in business then he relies on the government enforcing contracts. He can afford to go more places so he gets a lot more use out of the government funded roads. He can afford to get medical treatment when he's sick so he benefits from the FDA.

Basically taxing people is just an efficient (if not 100% accurate) way of charging people for the government services they use.

Re:FLAT TAX

[rtfa-troll]

Both can be true at the same time and can even be linked. People didn't save enough during the fat times so now they can't/don't spend enough during the lean times. This is not something new. There are even stories in the bible (old testament) about this.

Re:FLAT TAX

[Q-Hack!]

The rich do have to pay more, as they are the ones benefiting most from the infrastructure and services this country provides.

This statement is flat out misleading. If you are a citizen of the Country in question, you will have access to the infrastructure and services, same as the rich. The 'opportunity' for anybody to use various infrastructure/services is equal across the broad spectrum of incomes. Yes, the rich may utilize the highway system more, but they are providing jobs for people by doing so. However, the rich won't be utilizing welfare like the poor either.

Class warfare is exactly what is being waged on the more affluent. Stop blaming your woes on the rich. Can't find a job? Start your own business. I know a guy in a medium sized town who started his own business as a bicycle currier. His overhead started out as a classified add in the paper and a few fliers around town. He now has 6 employees working for him and is doing quite well. Would you believe that he has a masters degree in Electrical Engineering? The opportunity to succeed in todays society is there, you just have to figure out what will work for you. Yes, there are those who can't work due to a mental handicap... for them we should have a system to help them. However, I don't buy into the physical handicap as a valid excuse for not working. You just have to find something that you can do.

Personally, whether you have a flat tax or a progressive tax doesn't bother me. What I want to see is a complete removal of all deductions from the tax system... Get rid of all loopholes. May put a few tax lawyers out of work, but oh-well.

Re:FLAT TAX

[Q-Hack!]

I was going to include a link to http://www.attitudeisaltitude.com/aboutus-nick.php as an anecdote for my physical handicap statement.

Missed it somehow.

Re:FLAT TAX

[stdarg]

Will people be able to pay the tax of a cheaper government brand or a different type of government altogether?

That would probably work. You'd have to break down the cost of things and charge for each one separately. The ones you don't pay, you don't get to use. If you drive a car, you pay a road tax. If you send your kids to public school, you pay a school tax. It wouldn't work for things like the defense budget. On the other hand, the defense budget ($680 billion) divided up among 112 million households works out to $116/week. The positive thing? You'll have a lot, lot, lot more support to trim the federal deficit when people are more in touch with what things cost and whether it's worth paying, so expect those costs to go down.

Re:FLAT TAX

[Attila Dimedici]

So, you are planning to tax it yearly. For purposes of showing you the problem with the idea, I am going to use a yearly tax of 10% (it could be higher or lower, the principal I am trying to demonstrate would still hold true). If someone had managed to save $10,000, you would tax it $1,000. They would have $9,000 after taxes. The following year, your plan would tax them $900, leaving them with $8100. This would continue until they had nothing saved (whether they had spent it or it had been taxed away). Under your tax program, it would be counter productive to save money. Additionally, I am going to assume that you would tax goods that people own as well as any cash they have (otherwise the wealthy would just buy a lot of big ticket items and thus not have any "wealth" to tax). In that case, there would be significant disincentive to investing in anything as well.

Re:FLAT TAX

[rtfa-troll]

Your percentage; which is rediculously high; actually does matter. There is a key barrier, which is when it falls below the rate of compound interest. E.g. let's say interest rates are 5%. Now, let's assume that that's more or less the current average ROI, or put another way, that's what person makes on an investment. Taxation is currently 20% of income, so with 5% ROI, taxation would have to be around 1% of wealth.

Now, since taxation is below the rate of interest, it still makes sense to invest, since you get a 5% return and end up keeping 4%.

Re:FLAT TAX

[nschubach]

You're treading awfully close to the idea that everyone deserves the rights to do and own the same things... Just because some poor person cannot afford a yacht doesn't mean the rich should be taxed so much that the poor is granted that privilege. You need some sort of reward for success or people won't strive for success.

Yes, there is a disproportion in expenditure, but you don't simply tax the rich more so the poor can get more. It's self defeating for a society trying to be better. You are always going to have this disproportion (it's a good thing!)

Either way the rich man contributes back into said society. If he invests, he creates jobs. If he spends it on cars, boats... he puts that money back into the economy so the poor can obtain some of it to further their needs. The only way they are not is by Scrooge McDuck'ing the money into a giant bin... but someone had to build the bin. Even if that happens, when he dies that money's going somewhere. Relatives will spend it or the state will use it if there's no relative.

Re:FLAT TAX

[Attila Dimedici]

OK, so what you are saying is that you want to tax wealth that is invested. I only get interest on my wealth if I have invested it. Under current tax law, my money gets taxed when I earn it (whether that is through income tax, capital gains, or dividends--there may be other ways to earn money as far as tax law goes, but I am unaware of them) and then it is mine. You are proposing to change that to taxing the money I have and you are proposing to continue taxing it as long as I have it. The fact of the matter is that for most people they would not be getting 4%, they would be breaking even, or losing money (the interest paid on most savings accounts is slightly less than 1%). This means that your tax would make it even more difficult for people to accumulate enough wealth to actually accumulate significant wealth.

Re:FLAT TAX

[BJ_Covert_Action]

It would be a lot easier to save money if standard American wages paid for more than the bare minimum necessary for survival.

(Don't believe me on that? Calculate the maximum total income someone can earn working full time at minimum wage and then compare it to shitty-box rent prices and regular monthly utility bills over the course of a year. Let me know how much is left over for savings after those calculations, because last time I ran those numbers for California, the minimum wage worker actually was in the red at the end of the year).

Re:FLAT TAX

[s73v3r]

Wow! Super Extreme Regressive Tax coupled with No Way You're Going to Raise Enough Revenue! Where do I sign up!

Re:FLAT TAX

[s73v3r]

No you don't. You don't know anyone like that. You're just spouting off some crap that's the new "welfare queen" from the Reagan days. Same shit, different costume.

Re:FLAT TAX

[s73v3r]

I'm saying that those who expect people w/ higher incomes to pay more have class envy, regardless of what they're actually earning. It's the attitude that qualifies it.

And you'd be completely full of shit, and not understand at all the progressive tax system. Hell, I'd say anyone advocating for a system like yours wants to wage class warfare against the poor, as your system would cause them the greatest amount of pain. You'd be shifting the burden from those that can afford it easily to those who can't afford it at all.

Re:FLAT TAX

[BJ_Covert_Action]

It's always funny to me to hear people talk about, "The American Dream," myth as if it supposed to apply to one generation only. For instance, in your example of Bill Gates, you chose to focus on the fact that he got a head start from his father. But you didn't bother to discuss how his father got into the well-connected lawyer position. Nor did you discuss Gates's grandfather, great grandfather, and so on.

The way I always understood it, the American Dream deal was meant to apply to a family lineage. One person, in his life, may make the leap from bottom-line ultimate poor guy up to someone who managed to earn a nice, steady wage sweeping a shop. His kid could then grow up a little stronger and work in a field or something, providing a slightly better lifestyle for his kid. That kid might grow up to become the co-owner of the farm or something like that. Then he could send his kid to secondary education. That kid could study to become a skilled technician, allowing him to earn a wage to send his kid to law school. The newly made lawyer could then provide his child with enough luxury time and investment cash to allow his son to conquer the newly booming computer industry. And, thus, over the entire 200+ year history of the land of the free, one's family could mature from street urchin to aristocrat.

At least, that's how it was always explained to me. And that is also the reason that I thought so much value was supposed to be put on one's family. Don't work hard to become a billionaire and drive yachts and whore yourself out to hot looking, half-silicon women. Nah. Work hard to give your kids a slightly better life than you had.

Patience and steady hard work can cause really cool things to happen.

But like I said, that's just the understanding I gathered based on growing up in a very small U.S. town where your last name had some meaning attached to it.

Re:FLAT TAX

[s73v3r]

Also, your statement that without the government defending them, the rich would quickly become poor, you're suggesting that the government is/should be an extortion racket, like the mafia.

He's not saying anything like that and you know it. Seriously, if what he said is not true, then let's see the rich go to Somalia, and try to keep hold of their wealth there. Hell, lets see them go with nothing, and see if they can build themselves up to be half as successful as they are here.

Re:FLAT TAX

[Attila Dimedici]

If you are working at minimum wage it means that you are not productive enough to be hired for a decent job. The mean income in the U.S. is slightly above $30,000 a year. That is enough for a person to save some money.

Re:FLAT TAX

[BJ_Covert_Action]

I'm middle class. I pay $5 for a cup of Starbucks every once in awhile. But I don't bother to buy myself a new computer every 2 or 3 years. I drive a ncier Toyota, rather than a chevy, but I also don't go to the doctor regularly to have to cough up a few hundred bucks in copays every year.

For the record, I also drink Folgers regularly, and my roomate and I restored an old beater because, well, it was fun, so we drive that around too. That was actually a pretty decent bang-for-the-buck investment.

I'm not presuming to discredit your point, but I think it is worth pointing out that class lines don't always fall into neatly organized categories where members of class X always do Y while members of class U always do V.

Class structures are much, more complicated than that, based simply on the fact that different folks value different things.

Re:FLAT TAX

[s73v3r]

And they're only able to do that due to the infrastructure, security, and educational system maintained by the government, the poor, and the middle class.

Re:FLAT TAX

[s73v3r]

given that the rich 'pay for services' that only they'll probably never touch.

They don't touch them, but they definitely benefit from them. For one, these social programs help decrease violent crime, as they make fewer people need to steal in order to eat. Secondly, thanks to these programs, the rich are able to pay their employees less, garnering themselves more profit. Do you honestly think that Walmart would be able to get away with the wages it pays if they couldn't dump their employees onto food stamps and welfare?

But allowing for a person w/ a normal income, one would easily pay off the $1000 tax every year

Now I know you're full of shit. What of the poor, huh? What of those only making $10,000/year? First you're going to cut any government assistance they were using, and now you're going to force them to give up 10% of their income? A 10% that they very much cannot afford to lose?

Re:FLAT TAX

[s73v3r]

No, it's not 30%. It's 30% MARGINAL. Meaning you only pay that 30% on the income earned ABOVE that limit.

Re:FLAT TAX

[s73v3r]

No, you're trolling, especially if you think that the best way to implement the "Flat tax" is using a flat dollar amount for everyone. You're either trolling, or you hate the poor and want to make them suffer even more. That's the only explanation for that stance.

Re:FLAT TAX

[s73v3r]

No, that's an awful idea too. For one, the rich can dodge the sales tax as well, as they can afford to go outside the country to avoid it. Second, the poor spend most of their income, meaning they'd be hardest hit by a sales tax.

Re:FLAT TAX

[s73v3r]

Still extremely regressive, and now you're trying to penalize the poor for trying to enjoy some kind of entertainment or something that's not even a luxury, but not a necessity either.

Re:FLAT TAX

[s73v3r]

And what yours ignores is that the poor spend a greater percentage of their income, meaning they'd be paying a far higher percentage of their income in sales taxes.

Re:FLAT TAX

[s73v3r]

How can you talk about a national sales tax and NOT talk about how regressive it is? By its very nature, the poor would spend a far higher percentage of their income on these taxes, severely reducing their buying power.

Re:FLAT TAX

[cayenne8]

I think you're missing something: the rich person does indeed get a lot more from his government than the poor person.

I hear people say this over and over..and I don't get it.

The poor and rich both get the same protection from the same police force, fire dept...etc. They have protection under the same laws, local, state and federal. They can use the same roads and highways.

How are the rich getting more from the govt. than the poor person?

Re:FLAT TAX

[marnues]

I think you misunderstand. He wants to tax all wealth at 1%. However, because average ROI is 5%, investing makes plenty of sense. Hording wealth does not as it generally won't increase your own wealth but you will pay for it yearly. I already do this with the only asset of much value I own, my car. I think I'm even paying 2% of KBB. Add on a house and whatever appliances people own and you'll have the middle class tax base. Drop property tax and this actually seems like a good idea, though real problems could crop up. Hiding wealth in foreign countries comes to mind (second homes in Greece rather than the Hamptons). Arguing with the IRS over the value of that Camaro on cinder blocks in the front lawn also comes to mind.

Re:FLAT TAX

[SleazyRidr]

The rich person has a bigger house with more stuff in it, so it's more for the police and fire department to protect.

The rich guy can afford to buy more fuel, so he can drive further away, using more of the government funded roads. Also, the rich guy can afford to buy more expensive stuff from further away, so he benefits from the truck driving along the roads.

Re:FLAT TAX

[marnues]

That 40-50% of Americans includes me. What you are plainly ignoring is the vast amount of payroll tax that I pay. My return isn't generated by crazy accounting, hiding wealth, or EIC. I do my own taxes because it's a very simple process. I have my job's income and a very small income from my family farm (formed as a partnership). Subtract the standard deductible and my student loan interest, calculate taxes, subtract my payroll tax, and voila the federal government owes me money. Where in there do I get the government to buy me a large TV or a new car?

Re:FLAT TAX

[Attila Dimedici]

I do not misunderstand. He wants to make it harder for those with little money to accumulate more. Currently most savings accounts pay less than 1% interest. So, because he has enough wealth to get a 5% (or better) Return on Investment, he thinks that those who don't should be penalized.
You are proposing to drop property tax, which is levied by a different government body than the one he is suggesting collect a wealth tax (the federal government). You are correct that under his program saving makes no sense. Your best bet is to spend all of your money on consumables or place it out of reach of the tax man. If you turn it into cash, the tax man will have no way to identify how much you have left.

Re:FLAT TAX

[pnutjam]

In your own post, you admit that you are better off making more money now, then if you were making 1/2 your money. I know you will say this is only because you do not game the system, even though it is not true. You pay sales tax on everything you buy off the internet and never tried to talk your way out of a speeding ticket. Everybody plays games, the people doing most of the stuff you are describing are shooting themselves in the foot. Nothing you do is going to change the way they operate and punishing everyone because of a few is simply not smart, compassionate, or rational.

As to your percentage points, you are only telling half the story:
o you really think 50% of the population can pay for 98% of the governments spending? Do you even think that is fair?Yes, they can, and it is fair. This shows that 20% control 93%. I'm sure we can extrapolate that the top 50% control more then 98%. This is simply pay as you go.

Re:FLAT TAX

[pnutjam]

That's the old American Dream, the new one is personified by the Palin / Hannity / Jersey Shore / American Idol.

Seriously, what's the difference between Rush Limbaugh and The Situation?

Re:FLAT TAX

[mwvdlee]

At 116/week, that's over 6000 a year; a lot more than many poor people are able to save up in a year. And that's just for defense. That's excluding police, fire brigade, garbage collection, etc. Will the collective vote of those unable to pay that amount of tax outweigh the vote of people who can afford it?
Especially in a country like the USA, where social care is next to non-existant, a lot of people barely break even.

Re:FLAT TAX

[mwvdlee]

I can't afford a jet airplane like some of the richest people can, but I don't feel penalized.
Poor people will be able to afford luxury, just not the identical types of luxury a rich person might.
Either way I'm sure you'll agree it's a lot more fair than the "higher price, less tax %" mentioned by the GGP.

Re:FLAT TAX

[Actually, I do RTFA]

Since most of the patentable tax strategies have to do with federal income tax I'll keep my comment exclusively to that tax. In 2010 a single taxpayer filing a federal Form 1040 who made $12,000 from wages would owe $266 in taxes. He or she would be entitled to a refundable making work pay tax credit of $400. The tax payer would receive a net payment from the federal government of $134. They would have a federal income tax rate of -1.12%

Which is relevent how? Most people pay far more in payroll taxes than income taxes.

Re:FLAT TAX

[Actually, I do RTFA]

Or should shops start asking customers their income, and then charge them accordingly?

They already do that, albeit it subtly.

Do you value your time enough to find and clip a piece of newspaper? Will you purchase whatever they have overstocked instead of your favorite brand if offered at a discount? Will you deal with long lines, or do you go to the other supermarket that is more expensive?

Supermarkets around me give a great discount for using a tracking number that lets them see your shopping habits. By mapping that to sales, etc. they know what discounts can entice you, and get you into the store/buying specific things. When I check out, I'm given (extensively datamined) coupons.

Re:FLAT TAX

[Actually, I do RTFA]

Price-to-market accounting.

Have you ever played DND 3rd or 3.5 edition (bear with me?

You can customize magic items, and calculate a market cost. The cost to make an item is one-half of it's market cost. However, there are market cost modifications that you really want.

For instance, instead of making a magic ring, my male elf mage might create a magic ring that only works for male elf mages. That ring is clearly is less valuable.

Mark-to-market accounting is based around the idea that you want to maximize, not minimize, the value of assets.

I'll also point out that the vast majority of the fraud/malfeasance at Enron was manipulating the market value of their mark-to-market assets.

Re:FLAT TAX

[rtfa-troll]

So let's get this right. Currently a person gets, say 20k Dollars a year. They have savings of 3k and nothing else. Under my scheme, they pay 1% of 3k = $30. Under your scheme they pay 20% of 20k, say pay 4k tax, or more than their entire savings. Apparently this means that my scheme makes it more difficult for them to save.

As with every other simple flat rate tax scheme, there are lots of things wrong with the scheme I proposed (mostly the inability to distingush between adtive and inactive assets and the penalisation of people holding assets in the public good). It's just that this is not one of these things.

Re:FLAT TAX

[BJ_Covert_Action]

Oh what a load of horse shit. I worked a number of minimum wage jobs when I was in high school and a good few of my coworkers worked those jobs as their primary income. They were, and stil are, some of the hardest working people I have met. That guy loading lumber in the back of a contractor's truck to build a house? There's a good chance he is getting minimum wage. The guy unloading pallets of fertilizer from the back of a truck to sell to farmers ro grow food? Probably minimum wage. Hell, even some of the shift managers at the bookstores where I worked got paid minimum wage or, maybe, a quarter over it and they sure as hell were productive.

All the illegal immigrants picking the food that you eat off your table every night are getting paid less than minimum wage, actually. And you can't tell me they aren't productive with a straight face.

If you honestly think wages are tied to productivity in this society you are off your fucking rocker. If you need some evidence of that just look at HR and middle management in 90% of the companies that exist today.

Re:FLAT TAX

[BigDogCH]

I agree with most of your post, except that you say I am misleading. You quote the word "opportunity" and prefer the word "utilize". I used neither of those terms however. I simply said that the rich benefit more....which they indeed do from a financial perspective.

Otherwise, I agree with you mostly. Call it class warfare then, fine with me, it is justified. When the democratic process has failed because the wealthy control the vote....it is justified. I would go so far as to say criminal....but unfortunately the wealthy have had the power to change the laws to legalize their actions.

I would believe he has a degree in engineering. Most creative minds I know have such backgrounds. No surprise there...but he is going to have less and less customers as money continues to be concentrated at the top.

All I know is that I shouldn't be paying a lower tax rate on my capital gains than someone who actually moves heavy stuff. Isn't right. Slashdot has never been a good place to find people with any form of empathy however. Either way, your last statement is where I think most of us agree. No deductions. None. Done. Except maybe for stuff I buy.

Anyway, i found this interesting when doing some reading on the topic
http://upload.wikimedia.org/wikipedia/commons/0/01/Gini_since_WWII.svg

Re:FLAT TAX

[Attila Dimedici]

I worked a number of minimum wage jobs when I was in high school

There are three possibilities about your co-workers in those jobs. One, they were making more than you were. Two, they had no skills that made them a more valuable employee than a high school student. Or three, they had done something in the past that made them appear to employers as questionable employees (they had a felony conviction, they had a history of leaving jobs after only a short period of time). Until the last few years there was a demand for good workers. I managed a convenience store in the 90s, we paid better than minimum wage and we could not find enough decent employees to fill all of our positions. In the early 00s, I worked for a company that hired just about anyone, they paid better than minimum wage and most of their employees couldn't have held down a job anywhere else. They, also, had trouble finding employees when they needed to replace someone. Their best employees worked there for 6 months to a year, long enough to get a decent reference, and then got a better paying job somewhere else (or got promoted within that company).
Illegal immigrants don't count (they are by definition criminals).

Re:FLAT TAX

[garaged]

you obviously never seen how much does it make a farmer or someone working at a fabric, and THEY are the ones doing all the nice things we eat and use on our daily lives.

Re:FLAT TAX

[Your.Master]

If those are the only three choices you can come up with, you aren't very imaginative.

Re:FLAT TAX

[Attila Dimedici]

There may be other reasons why someone is only making minimum wage, but if you are working fulltime continuously for more than a year at no more than minimum wage, you either aren't capable of doing a job where you are worth more than minimum wage or it is your fault for some other reason.

Re:FLAT TAX

[Attila Dimedici]

you obviously never seen how much does it make a farmer or someone working at a fabric,

I have no idea what you are trying to say there. However, I know several farmers and they all make a good living. It is a tough living because not only does it tend to be hard work, but the cash flow is not spaced out through the year.

Re:FLAT TAX

[s73v3r]

It's more fair than that, but that isn't saying a whole hell of a lot. And remember, I wasn't talking about jet planes. I was talking about DVDs.

Re:FLAT TAX

[khallow]

And they're only able to do that due to the infrastructure, security, and educational system maintained by the government, the poor, and the middle class.

And the wealthy class, such as it is. And these services have a shitty ROI. I hear a lot of talk about taxing the wealthy more. I don't see a lot of talking about getting more for the money. That seems to be the opposite of the similar argument about energy conservation. Here, the people using the power are encouraged to conserve rather than pay more for the electricity they do consume. So why are we supposed to conserve energy but not conserve public funds? Why aren't we supposed to pay more for electricity we consume, but are supposed to pay more (excuse me, rich people not "we" pay more) for government services?

Re:FLAT TAX

[Bengie]

10 years back when I started college, I was making about $12 an hour, almost double minimum wage. About $1300k/month after taxes
Rent $500/month
Food $300/month
Car Loan $200/month
Energy $100/month
Random Medical $80/month average over the year
Basic Cellphone: $60/month
Basic Internet: $60/month
Gas $60/month
$1,360/month so far

Now toss in random college costs.

Where did I save money? Double minimum wage and still in the Red.

Re:FLAT TAX

[nosferatu1001]

It depends on how much / how long they can clean for. If its 15 minutes a day before exhaustion (etc) sets in and they cant do anything more that day then it shouldnt affect disability claims

Re:FLAT TAX

[khallow]

I could turn this around and note that the "infrastructure" only exists because of rich people and the taxes they pay and their employees pay. So what are you going to do for your rich people? This sense of entitlement is pure bullshit no matter how wealthy the target is or the complainer.

For example, Warren Buffet, who is generally considered among the wealthiest people in the world, complains that he pays less in taxes as a fraction of his income, than his secretary. But that's not likely to change, even with a income tax hike on the wealthy, because most of Warren Buffet's income is in the form of unrealized capital gains, something that's not likely to be touched (because it'd cause a mess for anyone who held stock, not just Buffet).

Re:FLAT TAX

[snowgirl]

This is going to end.

I would like to say that we will get better, but history shows us that we will continually argue about the same things forever. A hundred years ago we were complaining about the foreigners not assimilating, and how we need to reform the laws to prevent them from coming into our country, war, and "class warfare".

While I appreciate optimistic outlooks, I am simply too cynical and skeptical to believe in them myself. :(

Re:FLAT TAX

[snowgirl]

I was guessing at $12k/year to get it under the minimum earning to require filing, turns out I was wrong. Having looked it up, it seems to be more about $9k/year. I would have used that value instead.

Re:FLAT TAX

[BJ_Covert_Action]

Yeah because managers have never, ever shown any history of abusing their employees in the entirety of human history. Nope, it's not like businesses have ever, not even once, paid people absolute shit wages for hard, productive work just so they could squeeze a little more profit out of their product.

All of those kids getting $0.05 a week for 12 hour days stitching shoes together 150 years ago weren't producing any more value for their employers than that. Employers always are, and always have been, fair and just in their distribution of wages to their employees.

You're delusional.

Re:FLAT TAX

[rtfa-troll]

There is the death tax...

Which is avoided by putting things in trusts and so only affects the poor... ARGGGGH

The fact that tax loopholes were patentable

[mehrotra.akash]

The fact that tax loopholes were patentable is disturbing in itself..

Re:The fact that tax loopholes were patentable

[Joce640k]

You'd think a government would WANT a thing like that patented...get it locked down and lawyers chasing people who used the method. /Not entirely sure how you find the people infringing on your patent...

Re:The fact that tax loopholes were patentable

[king neckbeard]

I see two possibilities:

1. They think that allowing patents on tax loophole methods will actually advance the art of tax loopholes.
2. They want to be sure that their corporate buddies don't have any trouble using tax loopholes.

Re:The fact that tax loopholes were patentable

[kcbnac]

Bribe someone working at the IRS to look for certain "patterns" - of course, the bribe'd have to be sufficient to justify the prison sentence for "releasing" said info - but considering the probable patent infringement penalties/lawsuit payouts, one could afford a few IRS Agents every so often...

Re:The fact that tax loopholes were patentable

[Plunky]

In fact the government should take a tip from open source and offer bounties for tax loopholes.. pay the discoverer a set fee (or percentage of estimated revenue!) then close it.

Re:The fact that tax loopholes were patentable

[roman_mir]

As I always say: patents must be abolished (and I get nasty replies for that)

But here are you go, one more reason to abolish patents.

As to tax loopholes - AFAIC the more, the merrier, but one place where loopholes really need to be eliminated is in the law that applies to government - Constitution. Government shouldn't be able to find loopholes in the law that applies to it, or then you find yourself at the wrong side of the gun, when president says: you are a possible terrorist, so we must kill you with a drone strike (or however else.)

But paying less taxes is everybody's duty and responsibility. It's because government that is given money destroys the economy (my argument here).

Any amount of money that becomes available to the government above the minimum amount that needs to be used for the bare minimum of functions that government is authorized to do ends up hurting the economy.

Of-course the problem is government redefines what money is and then it just prints the hell out of it.

So patents on loopholes are obviously damaging to the economy, as they may be used to prevent people using the loopholes appropriately and it's just one more reason to abolish the patent system.

Re:The fact that tax loopholes were patentable

[Chardansearavitriol]

You can also patent mathematical formulas (with varying degrees of success) and the DNA of lifeforms. Oh, and im pretty sure amazon patented forks the other day. I may be wrong.

Re:The fact that tax loopholes were patentable

[ChinggisK]

Someone should just patent getting a patent, patent trolling, and patent warring and be done with it.

Re:The fact that tax loopholes were patentable

[gomiam]

Just wait until she turns into your wife!

Re:The fact that tax loopholes were patentable

[Attila Dimedici]

Expecially when you consider the fact that tax loopholes are written into federal law.

Re:The fact that tax loopholes were patentable

[GameboyRMH]

If that was passed, the accountant with the fastest fingers and lowest-lag phone line would be very, very rich overnight.

Not to say I don't like it.

Re:The fact that tax loopholes were patentable

[GameboyRMH]

Or becomes an ex-wife! 8-(

Well, there goes a way to get rid of tax loopholes

[LordNacho]

So does this mean that before this, the government could have patented the loophole structures, thus closing them?

Interesting example of the system getting so complicated it bites itself in the tail.

let's exapand this to all law...

[vkt-tje]

I suppose a tax loophole is nothing more then a clever application of the law, right?
So, forget about tax laws, take a simple example traffic rules.

Well, then I'm filing a patent for stopping at a red light: everyone that stops at a red light must pay me 1$.

This is exactly the same as a patent on a tax loophole: the application of laws.
You must pay the patent holder for using a specific tax loophole, which is just an application of the law.
Now I'm making you all paying for applying another law.

Patents are hilarious and disastrous.

Re:let's exapand this to all law...

[StripedCow]

You can cry all you want about how ridiculous the system is, as long as there are lawyers with lawmaking friends in the government which make money off of it, there isn't going to change anything.

Re:let's exapand this to all law...

[Custard Horse]

Lawyers definitely run the world and they own all money. Worship your new legal overlords.

Alternatively, you could get your head out of your ass and make a difference instead of passing the blame onto somebody else.

(cue the argument about one person not being able to make a difference)

Re:let's exapand this to all law...

[mehrotra.akash]

Stopping at a redlight can be considered a loophole to avoid paying the fine. Thus you should pay a royalty
Not stopping at a red light can be considered as a loophole to avoid paying the royalty, thus you should pay a royalty.

Extend for non binary decisions and enjoy!!

Re:let's exapand this to all law...

[Chrisq]

Stopping at a redlight can be considered a loophole to avoid paying the fine. Thus you should pay a royalty Not stopping at a red light can be considered as a loophole to avoid paying the royalty, thus you should pay a royalty.

Extend for non binary decisions and enjoy!!

Quick patent it. Then nobody will be able to stop at a red light without paying you.

Re:let's exapand this to all law...

[gomiam]

Neither will they be able to not stop at a red light without paying him. Ka-ching!

Re:let's exapand this to all law...

[thejynxed]

Except you won't make a damned bit of difference, because wait for it...if you aren't a lawyer, current/former CEO, or doctor in Congress, you aren't taken seriously, even by other members. For as often as they let Sen. Al Franken open his mouth, it's well-known that most of his fellow Senators see him as a joke just waiting for the punchline.

Laws in the USA, at least, seem to be more on the side of benefiting those who practice law for a living, than anything else. If this were not true, we wouldn't be seeing all of these silly proposed IP laws, anti-online gambling laws, etc cropping up in consistent intervals.

Ever notice how many new laws and proposed laws seem to appear during dead times as far as major cases are concerned? It's almost like they are constantly creating themselves more work on purpose....

Re:let's exapand this to all law...

[Theaetetus]

I suppose a tax loophole is nothing more then a clever application of the law, right?

Not really. A tax loophole is a clever application of something that wasn't foreseen by the lawmakers.

So, forget about tax laws, take a simple example traffic rules.

Well, then I'm filing a patent for stopping at a red light: everyone that stops at a red light must pay me 1$.

This is exactly the same as a patent on a tax loophole: the application of laws.

No - in your case, you haven't invented anything. People already knew about stopping at red lights, and in fact, it's right there in the law. You can't patent it because you haven't created anything new or nonobvious.
This is different than a tax loophole - there, people didn't know that, for example, you could create an annuity trust with nonqualified stock options, retain the thing yourself, and, if you live longer than the duration of the trust, have the trust assets revert back to yourself without paying taxes on any appreciation of the assets. That's weird because (a) you normally make trusts to survive past your death to pass assets to your family and (b) the tax rules were intentionally low when structured this way so that your heirs don't have to pay huge estate taxes. However, if you make yourself an heir, you can "die" and inherit from yourself, avoiding huge taxes. Unlike "stopping at a red light", this was something the lawmakers never thought of when they wrote those tax rules.

So, to return to your red light example, it would be closer to you figuring out, for example, that if you roll up to a red light, pop your car in neutral, jump out and run through the intersection, and then hop back into your car on the other side, you're not "operating a motor vehicle" while running the light, and thus are only jaywalking rather than running a red light, paying a $25 ticket instead of a $150, and getting no points on your license. And even then, ghostriding the whip may be prior art.

But still, why shouldn't something really weird, novel, and useful like that be patentable? The patent act doesn't say "whoever invents or discovers any new and useful process, machine, manufacture, composition of matter, or improvement thereon, may obtain a patent therefor, provided it's not in one of these specified industries ___________."

Re:let's exapand this to all law...

[shentino]

The problem with patenting stopping at a red light is that the establishment would never let you get away with it.

Selective enforcement of laws is right up there with selective performance of duties.

All that matters is who you are and whose backs you scratch...or stab.

Re:let's exapand this to all law...

[shentino]

one person alone cannot make a difference.

one person realizing this and trying to recruit allies will

a) Run into apathetic sheeple who are too numbed by the establishment owned media to give a shit

b) Find themselves targeted by the establishment as a subversive entity, and will find the full weight of the media brought down on them if they get out of line.

Re:let's exapand this to all law...

[shentino]

patent clerk: *gives the patent away to one of the elite*

elite: *pats the patent clerk's freshly bribed pockets*

Re:let's exapand this to all law...

[AmberBlackCat]

The best part is you would be the first to file, so who cares if you were the first to stop at a red light?

Re:let's exapand this to all law...

[Theaetetus]

The best part is you would be the first to file, so who cares if you were the first to stop at a red light?

Oh, please. Stop with this stupid FUD. The new first-to-file rule only affects simultaneous applicants for a patent. It doesn't do away with prior art by others. If you weren't the first to stop at a red light, you're not going to get a patent on it.

Re:let's exapand this to all law...

[shutdown -p now]

The patent act doesn't say "whoever invents or discovers any new and useful process, machine, manufacture, composition of matter, or improvement thereon, may obtain a patent therefor, provided it's not in one of these specified industries

Well, now it does.

Don't stand between a congressman and your taxes

[CuteSteveJobs]

> Tax Loopholes No Longer Patentable

LOL Congress. Stand near their dinner bowl and your Congressman will spring into action. Yet Submarine Patents and Patent Trolling are still legal. The USPTO continues to approve the stupid, trivial and obvious patents and those written in such ridiculous language that no one knows what they mean. The USPTO leaves it to the courts to sort out the mess for them, with $500 an hour lawyers who will argue adamantly for whoever is paying them. (They should have a rule in Patent Law suits that half-way the lawyers change sides)

But seriously: A startup hit by a Patent Troll will spend $1M to $5M to fight it off. How does bogging down startups like this help America invent? It doesn't. Congress have known about this for years but won't do lift a finger. But a tax dodging patent? Suddenly their outraged cannot be contained!

Don't get rid of the loopholes - license them!

[Anonymous Coward]

The problem with getting rid of tax loopholes is that this suddenly puts thousands of tax lawyers out of a job - and in any economy, putting a section of the workforce (no matter how despicable) is always a bad thing...

So, instead, the US government should take ownership of all the patents of tax loopholes, and license them to the lawyers for a fee...

The government still gets it's money - just has to license the loophole at 90% of whatever it saves.
The lawyers are still in work - they can tell the client "I can get you out of 10% of your tax liability"
The overly rich clients are still happy - they're still saving compared to paying the full amount of the debt

The only person who loses out is the one who had the patent in the first place...

Re:Don't get rid of the loopholes - license them!

[malkavian]

No, it doesn't put them out of a job. And where it does, the money stays in companies that are trying to innovate. For each lawyer that leaves employment, you'll probably have 10 more in productive companies that don't lose their job as their company doesn't get bogged down in a legal mire over spurious claims.
If some part of the system is broken (and it is), fix it. This may be the first of the cracks in the "Business Process" patent crap tht starts the path to getting the ridiculously inappropriate software patents fixed.

Re:Don't stand between a congressman and your taxe

[snowgirl]

But seriously: A startup hit by a Patent Troll will spend $1M to $5M to fight it off. How does bogging down startups like this help America invent? It doesn't.

Patents were never designed to do any such thing. It may have been post hoc rationalized as something to increase inventiveness, and honestly, I don't think there is any compelling data supporting either side.

Patents were intended to give a person an exclusive right to produce a new invention and make money off of it. Thus, patents are about greedily hording inventions and technology away from others in exchange for disclosing how they actually work, so that later (100s of years) that information would not have gone to your grave with you. (Like many kinds of stained glass that we no longer know how to make, because no one passed it on.)

It's basic purpose is to exploit greed to provide a benefit to mankind at a later date... this of course has the obvious effect of stunting the development and innovation cycle, because you can't use other people's ideas once they're actually available. I read an interesting piece about fashion, as it turns out that one cannot patent, copyright, or trademark fashion designs, and thus anyone can just steal an idea from someone else. Yet, they have a vibrant, active, and rapid development cycle. Of course it also renders old things "out of fashion" quite quickly as well, as soon everyone will have it, if it is popular enough.

A suggestion

[gzipped_tar]

We all know that patents are an innovation booster. You don't want to stifle innovation, do you? Then just introduce a "tax loophole tax" that tax the very action of evading tax.

You dawg..

Humorous.

[RightSaidFred99]

You can still patent all manner of ridiculous and stupid shit, but don't dare try to patent something that affects the US government's bottom line.

Re:Humorous.

[hedwards]

People were filing the patents, but when was the last time anybody successfully used the patents in court?

omg

[X10]

"Tax Loopholes No Longer Patentable"

OMG.

Re:Don't stand between a congressman and your taxe

[am 2k]

It wasn't hundreds of years, the time span was originally pretty short and got extended (20 years in the US now I believe). The issue in the IT sector is that after such a long time span, the inventions are irrelevant. Nobody cares about patents that are only applicable to 5MHz supercomputers nowadays.

Re:Don't stand between a congressman and your taxe

[Daniel Dvorkin]

Patents were never designed to do any such thing. It may have been post hoc rationalized as something to increase inventiveness

In the US, at least, this just isn't true, since the legal justification for patents (and copryights, and trademarks) is spelled out in the Constitution: "To promote the Progress of Science and useful Arts ..." It's true, of course, that any rational person can now see that the arcane, jerry-rigged, and corrupt body of IP law doesn't actually work to that end, but the intention was clear enough. And in fact, I'd argue that patents on physical inventions do serve the stated purpose. It's when we allow patents on things like software, accounting tricks, and DNA sequences that we run into trouble, and go far beyond what the people who wrote those words ever intended.

I think you're too moderate

[Chrisq]

Surely since the poor are more likely to use social services they should be taxed more than the rich. Why should Bill Gates pay his $13,000 flat rate when he is unlikely to use madicare, medicaid or the state school system?

Re:I think you're too moderate

[snowgirl]

Too moderate? I'm perplexed as to how anyone could even write that based on my comment...

Does my comment say something I don't understand it to say? Surely it only speaks towards the negation of a single idea... rather than espousing any personally held ideas, so perhaps it is just the vacuum of argument allowing people to insert their own ideas into my words?

Honestly, my personal position on this matter is "tax the rich more", as they're afforded more benefits from society than any poor person will ever experience. You know, because they're earning money from other people's labors...

Re:I think you're too moderate

[cbope]

I'll counter: Why should the poor pay a significantly larger *percentage* of their income for healthcare than the rich?

Answer: They shouldn't. In order for healthcare to be affordable for all, the costs MUST be distributed across the whole of the population. The rich contribute more (in terms of dollars, not percentage) because they make more. It's certainly not hurting the rich, as they seem to be able to continue getting richer. The problem is the poor not being able to afford healthcare. The percentage of people living below the poverty line in the US is shocking given that it's supposed to be a rich nation.

Re:I think you're too moderate

[stdarg]

Honestly, my personal position on this matter is "tax the rich more", as they're afforded more benefits from society than any poor person will ever experience.

Rich people take less, spend more, and overall are a net positive on the economy. So you want to tax them more? Don't we want to *encourage* people to have positive effects on the economy?

Re:I think you're too moderate

[stdarg]

Hmm, because the whole point of dollars is that they are absolute, not relative?

What you're saying is that time is equally valuable for everyone, which is wrong. If I earn $0/hour watching TV, well, I'm still committing my time to it right? Maybe you pay 20% of your income for your house expenses. Can I have your house in exchange for a perpetual license to 20% of my future income from TV watching?

Re:I think you're too moderate

[s73v3r]

So why aren't you earning money from other people's labors?

Because it takes money to make money? Seriously, this whole, "The rich make their money by investing; you can too!" meme is absolutely fucking retarded. The rich have surplus income that they can throw into stocks and investments. The poor don't.

Re:I think you're too moderate

[marnues]

Surely because Bill Gates profits vastly more from working in the great United States of America than a poor person, he should pay significantly more in taxes than a poor person. Sadly it seems they pay about the same amount.

Re:I think you're too moderate

[marnues]

Rich people absolutely take more. Government hand outs are not the only service a government provides. A stable economic climate that enables a rich person to thrive is a much larger function of the federal government than handing out money to poor people.

Re:Don't stand between a congressman and your taxe

[snowgirl]

It wasn't hundreds of years, the time span was originally pretty short and got extended (20 years in the US now I believe). The issue in the IT sector is that after such a long time span, the inventions are irrelevant. Nobody cares about patents that are only applicable to 5MHz supercomputers nowadays.

Yes, I was exaggerating, and you're absolutely right that the obsolescence rate of patents in electronics is increasing far faster than the expiration rate of patents, so when thy finally expire, they're essentially worthless. (N.B. there are a lot of people who are eager to build NES and SNES systems as soon as the patents expire. But this is far more of a "niche" interest than actual interest in advancing technology, and innovation.)

I remember in my history of engineering class, they talked about how the self-contained pistol cartridge was a huge deal, and put the developer ahead in sales enormously for a long time until the patent expired. However, of course, the self-contained pistol cartridge wasn't worthless when its patent expired, and so it became ubiquitous once the patent expired. God, how often do we hear of a patent in computers expiring and every is in a rush to reproduce it generically.... :(

Re:Years ago, I patented Bribery and Corruption

[Chrisq]

Now the world will be mine - bwahaaahaaaah

I'm sure people will have difficulty finding prior art on that one....

Re:Years ago, I patented Bribery and Corruption

[unixisc]

You remind me of the Dogbert Static Network

please, make it stop

[joss]

OMG, I wish there was a patent on making lame jokes (of the form: I wish there was a patent on XXX). Then assholes (like me) who make these pathetic attempts at humour would get sued into bankruptcy. I know there's no shortage of prior art (see any /. thread mentioning patents for last 10 years), but that never stopped anyone.

Re:Don't stand between a congressman and your taxe

[snowgirl]

So, patents never existed prior to the US Constitution, so thereby, when declared in the US Constitution it declares clearly the purpose and design of patents ab initio?

Or could it be that the post hoc rationalization of the purpose of the patent (as a meme) already existed, and was widely already propagated by the time the US Constitution was written, and that in a vein attempt to convince themselves of the purpose of a tool, they declare it loudly and explicitly without regard to the original design?

You know, because Family Matters and a number of organizations opposing gay marriage seem intent on declaring that the original purpose of marriage was to sanctify the union of a single man, and single woman, even though quite clearly we understand that marriage developed fluidly and dynamically out of cultures, and was more about assurance of parentage and legitimacy of children, as well as political partnerships, etc... hell, this "one man and one woman because of love" idea is quite a new "redefinition of marriage" itself.

Re:Don't stand between a congressman and your taxe

[am 2k]

Hmm the GIF patents expiring were a pretty big deal (but not due to the technological superiority, just because everyone had a lot of those files) and Apple's expired font hinting patents are still relevant as well, but those are the only ones I can remember, which is a pretty bad ratio for the number of software patents expiring all of the time.

Re:Well, there goes a way to get rid of tax loopho

[shish]

The government doesn't need patent law to enforce its ideas - it just says "no" and the thing is illegal in itself. Plus, patents would only work if the government was first to publish it, they'd be useless for closing existing holes.

Re:Don't stand between a congressman and your taxe

[snowgirl]

Hmm the GIF patents expiring were a pretty big deal (but not due to the technological superiority, just because everyone had a lot of those files) and Apple's expired font hinting patents are still relevant as well, but those are the only ones I can remember, which is a pretty bad ratio for the number of software patents expiring all of the time.

True, I will say that the things that truly deserve to be patentable will be relevant once the patent expires. Perhaps that would be a better test for patentability? "Will this invention still be relevant once the patent expires?"

Of course, much like making the perfect task scheduler for a computer requires it to be prescient, I doubt such a question would actually be workable...

This is a bad thing!

[mlush]

• a patent limits the number of people able to use the loophole to those who buy a licence.
• a patent gives the full details on how the loophole works making it much easer to write legislation to plug it.

Treating the symptom instead of the disease

[Hentes]

While it's nice that they have banned this the fact that certain financial/legal strategies are still patentable in America is ridiculos.

Re:Don't stand between a congressman and your taxe

[am 2k]

A patent examiner I know told me that they get patent applications for devices that do things like this all of the time ;)

Tax loophole patents are great!

[mwvdlee]

Tax loophole patents are great!
The problem isn't the patents, it's the fact that loopholes exist at all.
At least patenting the loopholes makes sure the tax office knows what tricks are used, making it easier the close them.

Re:Tax loophole patents are great!

[Rich0]

Loopholes are simply the result of a lousy judicial system.

The problem is that the law has become a game. Whether an action harms society is not important - only whether you can successfully argue that it isn't covered by the law.

I know somebody who teaches ethics and he says that lawyers are the worst students. They'll come up with scenarios and ask for a "ruling" on whether it is ethical. Then they'll tweak some aspect of the scenario and repeat the question, with the goal of optimizing the scenario to the most outrageous thing likely to be judged ethical. Ok, so lying to a prospective client to get their business is clearly unethical, but how about just telling them anecdotal examples of the 1% of people who benefited from hiring a lawyer in their situation, and not mentioning the 99% who simply wasted their money when doing so? What if I get somebody else to do the lying for me? And so on...

The results of such a system are predictable - a nation governed by laws that can be hundreds of pages long, which everybody and their uncle then ignores the intent of, producing legal briefs thousands of pages long in the process.

I've even seen this stuff on FOSS projects - somebody breaks some rule governing commits (you name it - QA, coding style, etc), and gets called on it. Then a 100 message flamewar erupts over whether the particular activity does or does not violate some complicated interpretation of the rules, and 300 new rules are proposed to take the place of one. Successful projects resist this, usually by having a benevolent dictator or somebody kick the person out with a one-line reason so that the rest fall into line. That works OK since ultimately even benevolent dictators have limited power in FOSS (forking and competition), but it doesn't work well for government (at least not in the long term).

WTF is this in the first place?

[Alex Belits]

If a tax loophole is patented, isn't it the duty of the government to make it illegal, thus making the patent worthless?

Re:WTF is this in the first place?

[Actually, I do RTFA]

Wouldn't that be confiscatory of the IP?

Re:WTF is this in the first place?

[Alex Belits]

Worthless IP is worthless.

On a more serious note..

[angiasaa]

Since tax evasion is considered dishonesty, I don't see why is should be un-patentable. Patent all you like, but at the end of the day, if you use the method, it does not make it legal. Since it is illegal to do so, how do you track people or organizations who violate the patent and then enforce it?
If you ask me, I think it is a bit like patenting a method to crack a safe. You can patent it all you like, but there are very few situations when you can actually use it legally. Not only do you get on the wrong side of the law if you use it, but if someone does use it, it can carry a second charge for the patent breech as well.
 
On the one hand, if you encourage people to patent their ideas, the IRS would be able to use that knowledge to look for similar patterns when they suspect that an entity is defrauding the government. If on the other hand, you refuse to issue patents for this, there's going to be a need for investigators to reinvent the wheel, so to speak.

Re:On a more serious note..

[maxume]

There is a difference between avoiding taxes and tax evasion.

For instance, putting money in a Roth IRA avoids taxes on any income those investments earn.

Haven't submarines been sunk?

[N Monkey]

Yet Submarine Patents..... are still legal.

How are (new) submarine patents possible? AFAIU, a few years ago the USPTO came in to line with the rest (or at least most) of the world in that a patent application automatically becomes public 18 months after filing. Prior to that, (again AFAIU), it only became public when granted, and hence submariners would keep tweaking their application so it stayed in the exam process until a time that suited them.

Re:Don't stand between a congressman and your taxe

[vawwyakr]

I see the opposite here. This makes tax loopholes available to all. So it seems to me that more companies will be able to use them not less.

Dangerous

[alexander_686]

First, all productive assets are wealth. Factories, land, etc. (We can then discuses if gold, big homes, fancy cars, and artwork is a productive asset, but that is for another time). So, you are taxing productive assets - which reduces their value. People will be less interested in investing in long term projects because it will be worth less.

If you do the math, because you are paying taxes every year, anything involving capital because much more expensive. It's very hard to invest in that climate. A wealth tax discourages investments and thus future growth.

Look at France that has one. Everybody who is looking at long term stuff moves it out of France.
     

Re:Don't stand between a congressman and your taxe

[hedwards]

What it means is that they were added to the constitution with that in mind. Without being in the constitution it would be less likely that patents would exist in the US.

Or are you just making a post hoc rationalization for why the original post was correct by changing the parameters and hoping that nobody notices?

Opportunism at work here

[SpaghettiPattern]

So when someone invents a cunning method to combine existing applications, that he may patent. But when someone else does exactly that and it is against the interest of the lawmakers, then the law gets quickly patched, but of course only to favour lawmakers.

I sense a teeny weeny bit of opportunism at work here.

Re:Well, there goes a way to get rid of tax loopho

[jbeaupre]

Sort of. What it means is that instead of folks filing for patents on loopholes, thus making it difficult for others to copy that method (and thus at least partially closing them), Congress has gone and made is so that anyone can use any new tax loophole method (keeping them wide open).

Re:Don't stand between a congressman and your taxe

[Kjella]

(Like many kinds of stained glass that we no longer know how to make, because no one passed it on.)
(...)
this of course has the obvious effect of stunting the development and innovation cycle, because you can't use other people's ideas once they're actually available

So how exactly could you use that stained glass technique? Oh right, it was never made available. If it had been patented, it must have been disclosed immediately, it'd be a monopoly on them for 20 years but people could understand what you did and start thinking of improvements or variations that wouldn't be covered.

And there is really the biggest reason I don't think patents have much value anymore, who actually reads patents to learn something? Nobody, just lawyers and patent trolls. If there's no trade secret gained, if it's just a free monopoly given then the public hasn't gained any knowledge. Then it's purely an economic incentive like lowering the tax rate or something like that.

No, I didn't know that

[Quila]

I haven't heard of it rising by 50% in two years despite a recession.

The net worth of the Top 400, basically all of our billionaires, is $1.27 trillion. If you confiscate all of their wealth you don't even pay off the deficit for the last year, much less any of the debt.

We do have 10 million millionaires, but as you go towards the bottom it more and more includes wealth due to homes, retirement accounts and personal business assets.

Re:No, I didn't know that

[PopeRatzo]

The net worth of the Top 400, basically all of our billionaires, is $1.27 trillion.

Where did you get that figure?

I've seen it reported as almost 20 times that amount.

The top 50 alone add up to well over a trillion.

Re:No, I didn't know that

[Quila]

Where did you get that figure?

Forbes 400 list, although it's possible my total was old and it's likely a bit higher now. But I just added the Top 50, and it's $730.9 billion. That's about everybody worth over $6 billion.

What?

[damn_registrars]

Introduce a FLAT $$$ tax - not even a percentage of one's income, just a flat $$$ amount, and call it that. No different from everybody paying the same price for a bottle of coke @ the store. Or should shops start asking customers their income, and then charge them accordingly?

So then if your income is less than that flat amount, you give the government all your money and starve to death? That sounds like a great plan.

Buying houses

[alexander_686]

I don't think it would make much difference in terms of people buying houses. I mean, the owner is going to have to pay the wealth tax no matter what. It might be the owner / occupier or it may be the owner / landlord. If it is a landlord then they will just pass the wealth tax onto the renter in the form of higher rents. They may not be able to pass the whole thing, but they will pass on most of it.

Re:Buying houses

[nschubach]

If it is a landlord then they will just pass the wealth tax onto the renter in the form of higher rents. They may not be able to pass the whole thing, but they will pass on most of it.

They will most definitely pass the burden of taxes ( ...and then some) on to the renter. The landlord isn't going to take a loss on the house. They'd sell it off before then. (My parents rent out houses and they expect profit each year from the rent, minus upkeep, minus taxes, etc. They aren't going to let someone live in the house for cheaper than it costs them to own it.)

It would actually increase rent making it harder for the poor to live.

Flat Tax is Scheme, need to tax Capital Gains

[Kamiza Ikioi]

The ultra-rich don't make their money via Salary, but by Capital Gains. It is the Capital Gains tax, not income tax, which really affects what billionaires earn.

You could raise the income tax on billionaires to 99.9%, and they'll barely feel it come tax time.

As for your shops metaphor, everyone pays a % of tax, not an $$$ amount, as you call it. Flat tax is actually a % idea, but you didn't even get that part right.

unenforceable anyway

[johanatan]

How can one know the strategies used in preparing tax returns (balance sheet ledger) after the fact? There's no one-to-one correspondence between the end result and the methodology used to obtain that result.

TOO LATE!

[jafac]

I already patented outlawing patenting loopholes! SUCKERS!

Of course they're trying to stop it...

[raymorphic]

Both should be abolished.

Re:Don't stand between a congressman and your taxe

[snowgirl]

What it means is that they were added to the constitution with that in mind. Without being in the constitution it would be less likely that patents would exist in the US.

Or are you just making a post hoc rationalization for why the original post was correct by changing the parameters and hoping that nobody notices?

I think I was referring to patents in general, and not to their stated intent in US law. Did the US Constitution establish and erect the original precedent for patents all over the world? I'm kind of doubting such a position.

You know, poll taxes were given a fairly innocuous intent, as were many other Jim Crow laws, and other discriminatory legislation. Many of the marriage amendments banning same-sex marriages are drafted with the stated intent to "protect the sanctity of traditional marriage", while in truth, they're a reactionary knee-jerk response to ensure that state courts cannot legalize same-sex marriages within that state.

See, there's this subtle thing called "lying about intent", or probably more accurately, "deluding oneself as to intent". You know, telling yourself that all other peoples being counted as 3/5ths of a person is part of creating a more perfect union where all men are considered equal.

Re:Don't stand between a congressman and your taxe

[snowgirl]

monopoly systems != patents! they've existed far longer.

True, however, patent == exclusive right, which I believe is the phrasing that I used.

the tax office should patent any method

[niftymitch]

The tax office should patent any method
and collect a fee.

If they do it correctly the fees they
collect should close the gap
on the national debt.

Some say the tax code is Greek to
them so there is hope that they
will also obtain some relief.