My idea on a tax to replace the income tax

[takebackourtemple]

   Here is how this would work. It is a debt tax. While it will be to discourage people from taking loans they cannot afford, it is actually based on the amount they owe.
   When someone takes a loan and goes into debt, until it is paid off they have to pay taxes on the amount of debt that they owe minus any money they have in non movable funds such as savings accounts and 401ks.
   Just like the income taxes are now, they would have to pay by tax brackets. The more they go into debt, the higher the taxes are that they have to pay. This bracketing will discourage them from borrowing even more money that they don't have and can't ever pay back. Like people who don't pay income taxes, a select few of the individuals who don't pay their debt taxes will be placed in jail. Since this is to discourage people from taking irresponsible loans, Ex post facto law will apply and someone has to take a new loan out before the tax applies to them. This also wouldn't apply to people who go into debt for emergencies such as hospitalizations.
   

[muman613]

 

While I understand what you are trying to say I don't think such a thing is a good idea. I am in debt and owe mortgage on my house. You are suggesting that I be taxed additionally besides my property tax and I think it is unfair. Many companies take loans and often pay off debt over years. The cost of the taxes would be immense and drive a lot of people into further debt.

If you ask my opinion...

Read my lips


No New Taxes

[takebackourtemple]

While I understand what you are trying to say I don't think such a thing is a good idea. I am in debt and owe mortgage on my house. You are suggesting that I be taxed additionally besides my property tax and I think it is unfair.

   This is why I mentioned that Ex post facto law would apply. People who already went into debt did so without the knowledge of such a tax so it would be unfair to tax them. If on the other hand, this was implemented and you took out an additional loan with full knowledge of this tax and it was for something nonessential, that is when the tax would kick in. Loans for essential things such as medical bills and even education would not fall into this category. Something like purchasing a $500,000 home or $60,000 car on a $30,000 salary would.