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Originally Posted by onetime2
These tax discussions always amuse me. I've met (or talked to via the internet) very few people who believe the government is particularly adept at controlling costs, tracking money, or spending wisely yet there are so many that are so willing to throw more into the system (of course it's usually people willing to put more of others' money into it rather than their own).
The government is inefficient. The only way to force the government to become more responsible is to shut the ever flowing spigot of rising taxes.
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Unfortunately so are corporations and individuals. Inefficiency really isn't the issue. It all comes down to the cost versus the benefit versus an alternative.
Back to the matter of Phory's original post, what it highlights to me is not whether or not we should tax this bracket or that bracket, but that our tax system is simply to over-complicated. In too many cases it does not achieve what is intended, and in many times the opposite.
A simple progressive income tax without loop-holes, but yet low enough at the bottom end that no loop-holes are needed for people to live comfortably, is to me the right place to aim. Elimination of payroll taxes and lifting the burden of health-care provision off of corporations are key boons to businesses of all sizes, but especially smaller ones. Sales taxes are not the answer.
As for Phory's personal situation, I'm no tax attorney, but perhaps there are more tax-friendly ways to structure the business? My point is though one shouldn't have to structure their business with taxes in mind, but instead structure it with business in mind. A business should be an entity, and when income is provided to an individual from it, through salary, benefits, perks, whatever, then it is simply added to the income column and taxed as such. Thus if money is collected by the corporation and put towards development, taxes aren't paid on it unless it actually reaches the pockets of individuals.