Posted by
Mike on Wednesday, September 28, 2011 8:56:29 PM
http://www.westernperspective.blogspot.com/
My proposal is that our government tax individuals and corporations on
the basis of wealth or net worth for each tax year, using a graduated
tax rate for increasing increments of taxable wealth. Clearly a simple
arithmetic model of increase in the tax rate as wealth increases will
not work because, at some point, the increase in taxes at a given wealth
level will eventually overtake the marginal wealth increase resulting
in a net loss of wealth, or negative balance after taxes, relative to a
lower wealth level initially. Therefore, the marginal increase in the
tax
rate will have to decrease as the level of wealth increases,
so that there will never be a negative balance after taxes, relative to a
lower taxable wealth level, which would otherwise create at some point
an absolute disincentive to produce more wealth.
Taking the net worth or accumulated wealth of each individual and
corporation for any given tax year, and given the total amount of tax
revenue projected as needed for the upcoming year, the exact tax rate,
and hence the exact amount of taxes owed, can be determined exactly,
using calculus, for each individual and corporation on an unbroken
continuum, with no absolute disincentives to production. Of course, it
would also be possible in a democratic society to divide the shares of
tax revenue paid by corporations and individuals on a different basis,
in which case separate calculations could be made for each of these two
categories to come up with the same result in terms of total tax revenue
collected. These calculations can be done easily using a computer
model or with a mathematical formula on paper.