Quote:
Originally posted by ltl/fb
Withhold on withdrawals, like they do now. Presumably they will only be taking out what they plan to use for consumption anyway. If they are going to sock it right back into a savings account, it would be like a direct rollover.
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So every time someone writes a check the bank has to withhold an additional amount from their account for taxes? Unless, of course, the bank deems that the check, or some portion thereof, is for a contribution to an investment account, or for non-taxable spending like food, or rent, or...... (Or are you dispensing with th theory that spending on necessities will not be taxed?) Sorting out which portion of a credit card bill is for taxable or non-taxable items will be a joy. So will sorting out whether someone is withdrawing money just to hvae some "just-in-case" cash around -- and getting taxed for doing that.
The banks, for one, will love the system, however -- just imagine how many people will bounce checks because they fail to calculate correctly the amounts that will be withheld on each one.
Perhaps I am missing the point of your plan completely -- are you really suggesting a tax system that says your taxes are x% times (income minus savings)?
