The simplist and most simple tax system

Posted on by Brad Heap

From David Farrar at Kiwiblog:

The best system would be that no one pays any tax until they are earning what one regards as the minimum amount needed for a family of their size. Churning money from tax to welfare to inefficient.

And after that make it a one rate flat system.

It would be simple, fair and effective. No more wasted money on tax agents to creatively balance the books to pay the minimum amount.

  • http://twitter.com/chrismsnz Chris Smith

    Progressive tax systems are fair and efficient, it's tightening up what is subject to tax that will stop the dodging. What DPF is suggesting is a variable (based on family size) tax-free bracket at the low end of income and simplifying the rest of the system (i.e. no working for families, simplification of welfare etc…)

    This will allow almost everyone to benefit, as opposed to shaving a few % of the top bracket and jiggering with the thresholds which, in reality, affects a very small percentage of taxpayers.