The Flat Tax:
Taxes should be flatter, but a universal rate comes with complications. For starters the flat tax would have to be 21-22% to be revenue neutral. A flat rate lower than that would leave the government supremely underfunded and/or explode the deficit. Secondly, a flat rate disproportionately affects low income people, who can not live so easily on only 80% of their gross income. Furthermore, to propose such a thing is to ignore the fact that most of America's wealthiest already pay a ~15% rate through "Capital Gains" rates and deductions.
Deductions:
To put it simply, a vast majority of people benefit and in some cases depend on these. To eliminate these deductions would amount to a massive tax increase on the middle and lower classes, which we know is not a good thing to do in a sluggish economy. I do however support limiting the availability of deductions to incomes under 500,000$.
Requiring companies to take taxes out:
Unless you are working as an independent contractor (1099), I believe this is already the case; hence the W2 you fill out upon accepting a job.
Increased user fees:
This works(ish) on a state level, but there aren't enough user fees collected by the federal government to make up for the revenue free fall that would occur under 15% flat tax system.
I would prefer a flatter, but ultimately progressive system:
>1,000,000$ - 30%-35% <- no deductions allowed for this bracket.
500,000$-1,000,000$ - 20-25% <- no deductions allowed for this bracket.
100,000$-500,000$/year - 20-25%
<100,000$/year - 10%-15%
(i used ranges because I'm not an well versed economist nor do I have access to CBO analysis, obviously the lower ends of these ranges would be preferable).
I would also abolish the "Capital Gains" tax system and begin treating it as income, subjecting it to the above bracket system.
Certainly not perfect, but flatter and equally as fair.
You're right about people not being able to live on just 80% of their income but 15% is an ideal tax rate. With taxes being lower the economy will have more jobs added in the long run which will make up for the loss of revenue in the near future. If the government can't support programs based on what is coming in then the government should be limited. Rather than raising taxes to meet the demands of the government I think we should be limiting the government to meet the demands of the people. Part of my plan wouldn't only be to grow the economy but also to simplify the tax code. If we just tax people at 15% and get rid of the capital gains tax and deductions that benefit the wealthiest then things would basically break even anyways. I think we basically agree when it comes to capital gains taxes. You're also right about the user fees at the federal level but states should be taking care of that on their own. What you're saying is pretty much what I was saying. If states have to raise taxes because the government can't throw out a freebone, then that's the result of a limited government. Where I work hardly any taxes get taken out and as a result I owed almost $200 this year. Your tax brackets are better than what we have. I prefer a flat and simple system where everyone pays 15%, there are no deductions or tax credits, and companies take taxes out. It's much simpler for the average individual and much simpler for our government. I'd say we agree more than we don't but do have differences.