Thought experiment: Democratic tax allocation

[JDragon]

What I lay out below is a thought experiment; don't stumble across the numbers if they irritate you and try to go with the thought experiment.

My general question is if you would be willing to pay more taxes if you could directly influence where they go.

So let's assume your tax rate is around 30%. Now the proposal goes like this: You pay 2.5% (or so) more in taxes. However, you get to allocate these 2.5% and an additional 2.5% (in other words: 5 percentage points of your 32.5% tax rate or about 15% of the total tax you pay) the way you like.

For example, if you earn 75,000$ a year, you would pay 22,500$ in tax but you would opt for the "democratic" tax scheme and therefore pay 24,375$.

However, only 20,985$ directly goes to the state. The other 3,750$ you can freely allocate.

For example, if you are a space exploration guy like me, you give a high share of it to NASA (or whatever your state's space agency is called).

If you believe veterans get not enough respect, you can allocate money to government programs that do something for them.

If you believe abstinence programs are underfunded, you give them your money.

And so on.




1) What do you think of the general idea?

2) If you do disagree with any proposal that includes "paying more tax", what do you think of the general idea of democratic tax allocation I laid out above?

 

[ehtheist]

I like the idea, but I strongly suspect that in many cases the freely allocated money would end up used in even dumber and more wasteful ways than the State manages to do, monumental accomplishment though it would be.

 

[m52nickerson]

It's and interesting idea a see it funneling extra money to things like education which would be a good thing. However I could also see that after one budget cycle budgets getting shifted around to basically negate the extra money put into those popular areas.

 

[JDragon]

It's and interesting idea a see it funneling extra money to things like education which would be a good thing. However I could also see that after one budget cycle budgets getting shifted around to basically negate the extra money put into those popular areas.

I would expect one effect to be citizens taking much more ownership. After all if you put all your money into primary education and those in power consequently try to reduce the non-voluntary amount, you would likely raise hell to avoid that. Also, there would always be the danger that you frustrate citizens if you do that so they opt out of the voluntary scheme and you end up underfunding your programs.

 

[Aegon Spengler]

Most people will agree to do this but won't trust it will go to the right area, no matter what.

I'd do it.

 

[Drenalin]

You'll never be allowed to tell the government how they can spend your stolen money

 

[m52nickerson]

I would expect one effect to be citizens taking much more ownership. After all if you put all your money into primary education and those in power consequently try to reduce the non-voluntary amount, you would likely raise hell to avoid that. Also, there would always be the danger that you frustrate citizens if you do that so they opt out of the voluntary scheme and you end up underfunding your programs.

Very true. Perhaps under such a system things would smooth out after a couple of years. That is if people were to hold politicians more accountable.

 

[JudoThrowFiasco]

Rather the option to opt out of social welfare taxation and use personal income to fund my own safety net.

 

[Deleted member 429137]

Interesting idea.

I predict governments would write in a provision that the democratic tax money goes to the government's all-purpose coffer in "priority situations". Which will be always.

 

[JDragon]

Interesting idea.

I predict governments would write in a provision that the democratic tax money goes to the government's all-purpose coffer in "priority situations". Which will be always.

Only then less citizens would opt in which would reduce the total available funding.

 

[Deleted member 429137]

Only then less citizens would opt in which would reduce the total available funding.

Hmmn that might be true. Not sure what to think now.

 

[ucunc156]

We kinda do this already based on an indirect smaller way by passing levies and other proposals. IE, we pay more property tax and pass local levies to increase funding for education in our area. Here in cincinnati, we passed the streetcar referendum, which was essentially paying a tiny bit more taxes to have a transportation system similiar to other big cities within the downtown area.

In general I wish we could allocate a lot of our taxes. But in all honesty, nobody is going to want to sign up to pay for the infrastructure taxes, which are desperately needed. I feel a lot of much needed programs would be neglected if we allocated a large amount of tax, but I do wish we had more control.

I'd have to think about what I would sign up for if I did this. I'm passionate about my taxes going to help the poor, but I could accomplish that by charity. I'd have to think about what government services would be worth it for me more so than helping the poor through charities. Maybe healthcare?

 

[Farmer Br0wn]

If citizens were allowd to allocate 100% of their tax burden as they see fit, you would find out quickly what services the state offered really mattered to people, and what "services" are just vote buying and handing out money and favors to the connected.

If taxation was voluntary, and the individual was able to allocate 100% of their tax burden as they see fit, then you would be approaching a moral system of social and financial interaction.

Another added benefit would be that the citizen has to be sold on the value of any given service, rather than being forced to pay for things whether they like it or not, or whether it violates their moral code or not (for example, War).

 

[snakedafunky]

Very few people would pay an extra 2.5% of tax just to decide where a total of 5% would go. Currently a lot of people risk long prison sentences to avoid paying taxes.

Also you take out 2.5% of potential income for you local community for the government to spent on something that might not benefit you area. As much as I like Space exploration giving 5% of your tax to hire some Mathematician to work on a space theory wont help your local area.
Also how much would be left from your 5% after the government had its hand on them. There would be so much bureaucracy involved that so much money would be wasted. You would also be limited in the long term planning because you dont know how many people will decide to pay the extra tax next year.

 

[JDragon]

Very few people would pay an extra 2.5% of tax just to decide where a total of 5% would go. Currently a lot of people risk long prison sentences to avoid paying taxes.

The exact numbers obviously are not key here.

As much as I like Space exploration giving 5% of your tax to hire some Mathematician to work on a space theory wont help your local area.

True, but that would be a matter of personal priorities.

Also how much would be left from your 5% after the government had its hand on them. There would be so much bureaucracy involved that so much money would be wasted.

Not necessarily if you have a smart e-solution. Also that is a general problem with governments.

You would also be limited in the long term planning because you dont know how many people will decide to pay the extra tax next year.

That is true - but tax forecasts are also a problem for states in general. The extra taxes would often have to be used for 'on-top' stuff.

 

[JDragon]

If citizens were allowd to allocate 100% of their tax burden as they see fit, you would find out quickly what services the state offered really mattered to people, and what "services" are just vote buying and handing out money and favors to the connected.

If taxation was voluntary, and the individual was able to allocate 100% of their tax burden as they see fit, then you would be approaching a moral system of social and financial interaction.

Another added benefit would be that the citizen has to be sold on the value of any given service, rather than being forced to pay for things whether they like it or not, or whether it violates their moral code or not (for example, War).

There can be no 100% free allocation. At most with 100% to allocate you would be able to shift percentages within reasonable limits I guess. I mean imagine you (going by your nick) would allocate 100% to farming subsidies.

 

[GearSolidMetal]

If citizens were allowd to allocate 100% of their tax burden as they see fit, you would find out quickly what services the state offered really mattered to people, and what "services" are just vote buying and handing out money and favors to the connected.

If taxation was voluntary, and the individual was able to allocate 100% of their tax burden as they see fit, then you would be approaching a moral system of social and financial interaction.

Another added benefit would be that the citizen has to be sold on the value of any given service, rather than being forced to pay for things whether they like it or not, or whether it violates their moral code or not (for example, War).

I was going to post something similar to this. Well worded.

Only thing I have to add is, the elites, AKA our betters, AKA the ruling class view themselves as knowing how to spend our money better than we do.

Edit- To benefit themselves first, to buy votes second, and provide for citizens third.

 

[IDL]

I like the idea, but I strongly suspect that in many cases the freely allocated money would end up used in even dumber and more wasteful ways than the State manages to do, monumental accomplishment though it would be.

Like a project to build a statue of 'Deez Nutz'?

 

[IDL]

Sounds like it would be the equivalent of making charitable donations towards government programs, except it wouldn't be a tax write off, and it wouldn't be optional.

I don't think many would go for it.

 

[JDragon]

Like a project to build a statue of 'Deez Nutz'?

Ideally this proposal would not decide that a statue be built, merely how tall it will be.