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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: LindyBill who wrote (116977)	5/29/2005 11:38:22 AM
From: JohnM	Respond to of 793731

Problem is that every tax proposal, at least at the moment, has to be "revenue neutral." If you put choice as a factor, you introduce more unpredictability than the planners like. I know you mean a one time choice, but when planning the policy, no one would have any serious idea just how many would take which path. I suspect we already have an effective flat tax; or, perhaps, even a regressive one.

To: LindyBill who wrote (116977)	5/29/2005 1:05:28 PM
From: Ilaine	Read Replies (1) \| Respond to of 793731

Raising the capital gains exemption on your residence has had some very interesting effects, most importantly getting people to buy houses in parts of inner cities that were decaying, which raises the tax base for cities, which means more money for schools, cops, etc. Open air crack markets can only flourish if the neighborhood tolerates them. My guess is that this is one of the main reasons we don't see as much crime from crack dealers anymore -- I will suggest to Ben that this would make a good master's thesis project. When we first moved in, I had not been keeping receipts for capital improvements to the house because I couldn't imagine the house would be worth $500K more than we paid for it -- but it already is (almost). Well, I do keep track of capital improvements now that my primary office is in the home, because some of those are deductible as part of the home office deduction. As it stands, when we sell our house, we get the $500K exemption but have to recapture the home office deduction. If we went to flat taxes -- all these loopholes and gyrations, what would happen to them? I can't imagine Uncle Sam saying, "OK, Ms. Blue, forget about recapture."