I don’t think the math adds up for it but we may not let accounting get in the way of a good story.
Not sure where I remember reading but the IRS brings in about $2.5T in income tax. Based on current import levels, we’d need tariffs of 100-200% IIRC across the board to make up for income tax revenues.
With that high tariffs and prices of some things double or tripling, local manufacturing would surely pick up, thus reducing imports and the corresponding tariff revenues. That’s a main difference between that and a point of sale VAT. A VAT federal tax would be based on consumption levels, not imports levels.
I could be ok with it too. At least long enough to Rothify the balance of my retirement accounts.
No reason to prevent them either since that would have no federal tax consequences.
Since many people would still have state taxable income on Roth conversions, I think they’d have to keep the Traditional and Roth accounts separate anyway. Then keeping the conversion capabilities to allow people to pay state income tax now instead of later makes sense.
State taxes tend to follow the federal tax law on that. There is no reason to think that if the federal government eliminated income tax, that the states would somehow grandfather the concept of roth when it was no longer a thing federally.
Is there any reason to think states will make wholesale changes to their tax codes just because the Feds eliminate federal income tax? Because the only reason states would need to grandfather anything is if the state choses to make changes to state tax laws.
State AGI is based on federal AGI with some modifications. Literally every state would need to come up with wholesale change their tax laws if the federal income tax disappears because there would no longer be a federal AGI.
They could just as easily start asking about your medicare wages from your W2. Eliminating federal income tax would not eliminate FICA taxes (if anything FICA taxes may well increase without an income tax). Then they could either decide to not tax interest and capital gains (and just adjust tax rates slightly) or require you to enter that information from new forms banks would need to send you.
No question the lack of AGI would reshape the way state do income tax. But instead of completely revamping their current tax revenue mix (real estate, sales tax, income tax, estate tax), I think it may be simpler for many to simply modify the income tax data collection itself.
One issue though could be tax compliance costs. Without the IRS doing the lifting on at least checking your numbers minimally and thus producing a relatively reliable AGI for states to implement their income tax, states would probably have to ramp up their compliance efforts which may be costly and/or reduce tax revenues.
Fair enough. Then whatever new form the FICA taxes and medicare wages are going to be reported on. Unless Trump also cancels social security, that still would need to track your lifetime earnings to determine what you’re entitled to.
Did I say 50,000 victims of that democrat IRS espionage? Better make that 400,000. They found a few more once someone in charge was bothering to look a bit harder.
Sadly, I don’t think this will increase his 5 year jail sentence by 8x.
Since he pleaded guilty, I don’t think he can be retried for something that was already plea bargained.
I’m surprised this stuff was not revealed during the discovery phase of the trial. I think the IRS should not be allowed to remain silent on why suddenly the number of compromised accounts increased this much. Either the IRS does not know how to track access to their records or they deliberately hid the extent of the breach. Neither is inspiring confidence that it’s going to do a better job next time.
Of course, “next time” is moot anyway since our data is being leaked over to Doge and who knows who else without oversight, privacy or transparency. So next time (if it has not already happened) we’ll be talking 300 million leaked records and worst case, the culprits will not get prosecuted or get pardoned anyway.
Here I thought the IRS under the Department of Treasury supervised by a Senate-confirmed Secretary of Treasury were the one processing my taxes…
Now I get it. It’s actually POTUS himself leaking them to the random unelected, unconfirmed, and exempt of scrutiny or accountability Doge … I feel so much better and safer about the privacy and transparency of the whole process.
Thinking about it, the whole Senate confirmation thing, having separate Secretaries for different Departments is a waste that Doge should address. We just need POTUS to authorize Doge to do every single bit of the government business. One ring to rule them all (and kiss obviously). No pesky scrutiny or accountability to anyone, especially not Congress, no delays in confirmation, … a good obedient opaque autocracy, just like the Constitution demands… oh wait.
Read the Opinion and Appointments Clauses 1 and 2, Section 2 of Article II referring to the appointment of principal officers serving under POTUS under advice of the Senate.
Isn’t Musk and/or Doge a “principal officer” considering their expansive role? I’d say so when Trump has to remind Musk to let the confirmed Department Secretaries speak during Cabinet meetings… Where was the Doge confirmation by the Senate allowing it to supercede any Department Secretary decision?
Where’s the accountability and transparency for when this goes south (as it already has when cancelling the wrong program or accidentally firing essential people) when they cannot even name the official head of Doge (only an interim acting head upon duress recently) despite it having extensive access to all parts of the government?
IMO Trump should instruct each Department to conduct reviews of their operations, provide reports to Doge for suggesting/confirming changes (spending cuts) but not have Doge completely override the authority of the confirmed secretaries and have direct access without accountability. Otherwise, why even have Departments and Cabinet Secretaries, and Senate confirmation if that’s only going to be for show?
The president needs the data to administer the tax collection system. In order to do this, he delegates the use of the data to people within the executive branch. But those people work for him and he directs them in how they use the data. In that respect, he is the owner of the data since he controls who accesses it and how they use it.
President Trump‘s actions are based on the unitary executive theory. See this article about the theory.
Article II, section 1 of the U.S. Constitution vests the executive power in “a president of the United States.” Those words do not seem ambiguous. Under the Constitution, the President, and no one else, has executive power. The executive is therefore “unitary.”1 It follows, as the night follows the day, that Congress lacks the power to carve up the executive—to say, for example, that the Secretary of Transportation is a free agent, immune from presidential control, or that the Secretary of Commerce can maintain their job unless the President is able to establish some kind of “cause” for removing them.2
On this view, the Supreme Court’s unambiguous embrace of the idea of the unitary executive in Myers v. United States3 was a golden moment in constitutional law, a ruling on which diverse people ought to be able to agree, and indeed one that they should enthusiastically embrace. And on this view, the Court’s messy, confusing, neologism-based, indefensible rejection of the unitary executive in Humphrey’s Executor v. Federal Trade Commission,4 upholding the independence of the Federal Trade Commission, was a dark stain, one of the lowest moments in the Court’s history and a prime candidate for inclusion in the “anticanon” of constitutional law. If that is so, the only serious question in the removal debate, for many decades, has been simple: Should Humphrey’s Executor be flatly overruled, or should it be confined as much as possible simply in deference to a longstanding precedent on which much of American government has been built?
But isn’t that what his Secretary of the Treasury is for? POTUS delegates data collection to his Treasury Secretary who’s in charge of the IRS. Treasury Secretary asks the IRS for the data and reports it to the POTUS.
Why give direct access to Doge then? At best, it just adds an extra point of failure in the system and POTUS still gets the same taxpayer data. At worst, Doge can do whatever it wants with the data since it’s not tied to Disclosure laws like the IRS is. Doge is also exempt from federal record keeping by working under PRA - unlike the Department of Treasury and IRS - and is not held to FOIA rules. How can taxpayers not be concerned about Doge’s handling of sensitive PII given the opacity of its operations and freedom from any accountability? To me it sounds like a system ripe for abuse of all kinds.
