Taxes and wages

Something I’ve been mulling over the past few days. Tying wages to tax rates.
Yes I know alot of businesses weasel the system and skip out on taxes.

So let’s say company A pays 15 an hour. They would get a tax rate of 30%
Company B pays 20 an hour and has a tax rate of 25%
Company C pays 25 an hour and gets a tax rate of 20%.

Of course this would all have to be based on fields and what not.

But would a system like this work? Maybe if you changed it to a % above minimum wage?

I’ll just say as an accountant I’d love a system like this. It would create a lot more billable hours for me and ensure a lot more job security.

Upper management may not like my bill afterwards though. :rofl:

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Do you think if a candidate came out with this platform that people would be for it?

It would be a good sell to the union types (or really any group pushing for increasing wages).

The big problem I see is selling it to management types. It would increase the burden for them, as it would be very difficult (and thus expensive) to implement.

So, I guess I would say it would sell to a portion of the population. A different portion of the population will see it as an undue burden.

This is a noble idea but not in any way practical. Companies that pay minimum wage typically work with much tighter profit margins. Companies like Apple have huge profits and as such can compensate many of their employees very well.

Just as an aside, as part of different jobs I’ve had over the past few years, I’ve had to argue both sides of questions like this - depending on who was paying me.

Interesting…I guess it’s too simple of a solution for our economy maybe? Inwas thinking the tax rate would be tied to your lowest wage…not highest. Average wouldnt work because then we would still be in the same boat I think

Yes - that is one component. Another component is the size of employers and the scope of talent that they hire. A company like Apple is going to have a broad spectrum of wages - from the entry level employees to the CEO. A mom & pop type store may have 10 or fewer employees - where the variation isn’t nearly that large.

The profit / expense ratios can be totally different across industries and size of companies as well. Things like that can factor in as well.

I’m for it. You would definitely get rid of lazy workers as upper management would delegate more and more work to the $70 an hour guy and fire the $10 an hour guy.

If they could get away with that, they would have done it already.

Someone making $70 an hour is not going to be dumped on.

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Is this an average or median wage? Could get skewed…bunch of minimum wage then one huge wage

I’m not sure…? I was just thinking the lowest wage would be tied to a tax bracket…so if McDonalds pays 15 an hour for their base employee then they get a 30% tax rate. Managers and whatever wouldnt really matter because they make more

This type of system could also be catastrophic for small businesses and startups, whom work on tight profit margins and typically are not even profitable for the first few years. This system would penalize the small guy for economic conditions out of their control.

Startups typically are not profitable for a period of time. No profit, no taxes.

I can see it working for large companies. The savings in taxes I believe would outweigh employee salaries.

Most jobs have a pay range for all positions. Allows for raises. IE the job wage starts at $9.00 per hour for entry level and tops out at$15.00 for the same position with more experience. How does your system account for that?

Indeed, I’ve long joked that as wonderful as a flat tax would be there would be a short term mini recession from all the underemployed and unemployed tax preparers.

easy. Base pay is 9$ so thats the rate they would be matched with.They want the lower tax rate? start at 15

I want to know who taught you economics and finance and I want to slap them in the face. This is not how it works.

I have no idea what you’re talking about? How is a comment about profit margins unrelated to economics?