https://townhall.com/columnists/calthomas/2024/11/14/trumps-chance-to-change-taxation-n2647729
Trump’s Chance to Change Taxation
Cal Thomas | Nov 14, 2024
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If any constitutional amendment can be hated, it would be the 16th Amendment.
Passed by Congress in 1909 and ratified by the states in 1913, it allowed Congress to “levy income taxes without apportioning them among the states based on population.” At first the collection of revenue came from the very wealthy and in a small percentage, but World Wars I and II put the country in debt and Congress, using the power given to it by the 16th Amendment, began spreading the burden around until we arrived at our present moment when half the country and corporations are paying taxes (when state, local and other taxes are included, that amounts to more than half their income in states like California and New York). Half the people pay little or no federal income tax at all.
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Younger workers would have freedom of choice (a phrase Democrats like when it comes to abortion, but oppose if it involves schools and the stock market). Workers could choose a new retirement system Forbes called Personal Retirement Accounts (PRAs).
Under his calculation, in 1999, younger workers could deposit 4 percentage points of their Social Security taxes into their own PRAs and increased their contributions as follows:
- In 2003 – 5 percentage points.
- In 2004 – 6 percentage points.
- In 2005 – 7 percentage points.
- In 2006 – 8 percentage points.
Forbes wrote that if his idea had been adopted, a single working mother who was 25 in 2000 and retires in 2040 could have earned a nest egg of $1.2 million in her PRA. She could then purchase an annuity that pays her$100,000 annually, nearly twice as much as she would receive under Social Security. A high school graduate who was 18 in 2000, Forbes wrote, and retires in 2040, would have a nest egg of $2 million.
Among the reasons Democrats have refused to reform Social Security and Medicare, both of which are projected to become insolvent in the 2030s without reforms, is politics. If they solve the problem, they lose the issue.
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Let’s do both:
(1) Repeal the 16th Amendment and substitute tariffs. (The Taxpayer pays for either. But it changes the incentives.)
(2) Let “We, The Sheeple” put a small portion of their Social Security taxes into the proposed Personal Retirement Accounts (PRAs) and allow a tax free rollover to an annuity at any future date,
This way we’ll get the best of both suggestions.
And, let’s enact the Flat Tax while we are repealing the 16th.
Then, we can repeal the 17th too.
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