I don't think that your post that I quoted came across the way that you think.  I was kind of addressing an earlier post regarding "mega-churches".  I figured that you being the good liberal that you are probably agreed with the post.  Again, it's hard to really discuss this while staying within the COC.

 

I do also agree with you that a group or organization that does legitimate charity work should get tax relief.

 

But that's the problem.   What is "legitimate charity work?"   Right now, getting a tax exemption involves filing a form with the IRS and having them decide whether you are legitimate or not, and that obviously leads to all sorts of abuse.   The problem with exemptions is that someone has to be the judge of who deserves an exemption.   So you set up rules and a judging organization to hand out exemptions.   And that leads to the setting up of businesses who make money on guiding people through the process, finding the loopholes, filling out forms, going to court, and so on and so on.  

 

Set up any simple rule about who can get an exemption, and there will be a thousand ways to take advantage of that rule and turn your "charity" into a money making enterprise for the benefit of those who run it.  That's the problem with handing out tax exempt status.  

 

Suppose I set up a charity that builds homes for the homeless.  Suppose the rules say I have to spend 90% of the contributions.   Okay, fine.   Can I hire my brother's construction company to build the homes?   So you make a rule that says I cannot hire a company owned by a relative.   Okay, what constitutes ownership?   Over 50% ownership?   Can I hire my brother's company if he only owns 49% of it?   What if the other 51% is owned by my brother's son in law?   And so on and so on and so on.   Make a rule, and I will get around it.   Only one rule works.   No exemptions.  

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But that's the problem.   What is "legitimate charity work?"   Right now, getting a tax exemption involves filing a form with the IRS and having them decide whether you are legitimate or not, and that obviously leads to all sorts of abuse.   The problem with exemptions is that someone has to be the judge of who deserves an exemption.   So you set up rules and a judging organization to hand out exemptions.   And that leads to the setting up of businesses who make money on guiding people through the process, finding the loopholes, filling out forms, going to court, and so on and so on.  

 

Set up any simple rule about who can get an exemption, and there will be a thousand ways to take advantage of that rule and turn your "charity" into a money making enterprise for the benefit of those who run it.  That's the problem with handing out tax exempt status.  

 

Suppose I set up a charity that builds homes for the homeless.  Suppose the rules say I have to spend 90% of the contributions.   Okay, fine.   Can I hire my brother's construction company to build the homes?   So you make a rule that says I cannot hire a company owned by a relative.   Okay, what constitutes ownership?   Over 50% ownership?   Can I hire my brother's company if he only owns 49% of it?   What if the other 51% is owned by my brother's son in law?   And so on and so on and so on.   Make a rule, and I will get around it.   Only one rule works.   No exemptions.  

 

You're right, no personal exemptions and no income taxes. It's the only way.

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“An empty vessel makes the loudest sound, so they that have the least wit are the greatest babblers.”. - Plato

A consumption tax isn't happening. Regardless of whether it's the right move going forward or not it's not going to happen.

 

You do know that the Founders didn't want income taxes, right? That it wasn't happening...until it did. Neither was gay marriage, until it did. Never is a very long time.

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“An empty vessel makes the loudest sound, so they that have the least wit are the greatest babblers.”. - Plato

No, and neither would any other entity. You just need a mechanism to insure that individuals aren't gaming the system by making every purchase through an entity.

So you're talking about eliminating all corporate taxes? I don't know about you, but I'm not interested in paying a 70% consumption tax so that Halliburton can post trillion-dollar profits.

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So you're talking about eliminating all corporate taxes? I don't know about you, but I'm not interested in paying a 70% consumption tax so that Halliburton can post trillion-dollar profits.

You won't. And please dont fall for the notion that corporations pay taxes, they dont. They are just tax collectors.

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“An empty vessel makes the loudest sound, so they that have the least wit are the greatest babblers.”. - Plato

I'd rather just end all taxes.  There's absolutely no need for them in a debt-based money system.  In our financial system, debt is wealth, so just print the money you need and go further into "wealth". 

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I'd rather just end all taxes. There's absolutely no need for them in a debt-based money system. In our financial system, debt is wealth, so just print the money you need and go further into "wealth".

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Nevermind

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Seats would not determine the status of 'mega church'.  How much money you bring in would.  Pretty simple really. 

That's how I would see it. 

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There are plenty of laws on the books that grant tax free or tax relief status to non profits and charities fall under those. 

 

As for churches the first amendment says nothing about taxation. As far as I understand it has been interpreted as saying the government can enact no laws either promoting or restricting religion. The 1st doesn't say anything about them not paying taxes. That comes from being a non profit. So yeah, whether a church is a charity is very relevant. 

 

"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof;"

Back in the day, before the government got involved with 'helping' the under-served folks, churches provided for them and thus were considered charities even if that wasn't the word used to describe it. 

 

Without trying to cross the COC line I will say this. The church I go to uses the tithes from the people to pay the electric bill and other bills associated with ownership of a building. Maintenance and such. The rest goes into our community and overseas charities (I guess that's what you'd call them). Our pastor has a full time job elsewhere and does not receive any payment out of tithes.

 

Saying all of that, would you consider them non-profit or charity?

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When you start trying to put in rules about who does and does not qualify for exemptions, you're just inviting certain parties with enough at stake to employ lawyers and accountants to make sure they qualify for those exemptions on paper, even if they do not in practice. The only way to put a fair end to that abuse is to eliminate nonprofit/tax-exempt status entirely, but then you're killing off thousands of reputable charities that actually do put their money where their mouth is. It's a painful proposition either way.

 

For what it's worth, I don't think that simply being a church should qualify an organization for tax-exempt status. Simple reason? The First Amendment establishes a separation of church and state, and lifting taxation on a church is stepping across that line into displaying favoritism towards religion. Of course, we all know what that would accomplish: the church down the street that has an attendance of 50 and regularly has volunteer groups at retirement homes, cleaning up the roads and feeding the homeless would be forced to shut down while the mega-church two miles away simply cuts back on its charitable activities (if it really does any in the first place) and has the pastor tag a line about needing more donations to counter the government attack on their beliefs at the end of his sermon.

 

I think the best answer is to remove tax-exempt status, but to allow any charitable organization or church to write off taxes on any actual charitable expenses. Basically, tax them like we're taxed when it comes to charitable spending. Depending on the size of the organization, the percentage of income spent on payroll (to prevent a CEO from making a disproportionate amount of money, like many charitable CEOs do) and the amount of its annual income that is put towards charitable endeavors, additional exemptions or an increase in the tax deductions, up to a real dollar-for-dollar ratio, could be in play to help the organization with 5 employees, each of whom makes $35,000 per year, to continue functioning. Basically, the bigger you are, the more you pay, period, and no mega-church or 5,000-employee charity will be able to hide behind accountants to dodge significant tax bills, but all entities can realize significant tax reductions by devoting more income to charitable spending.

 

I know, it's not perfect, and it still leaves lots of potential for loophole exploits, but it's unquestionably an improvement over a system in which the NFL would still not be paying any corporate taxes had they not voluntarily done so. Lots of churches in this country do a great deal of charitable work; lots of others don't. Lots of charities put all their time and money into their work; many others pocket large sums of money and send as little as ten cents of every dollar taken in back into the community. There has to be a check in place to make sure that the small churches with members who bust their butts improving their community are taken care of, and the moneymaking machines hiding behind the veil of religion are forced to pay the same taxes that any other business bringing in cash by the busload would.

 

He only pays taxes on goods he's selling me the pipes and the assortiated parts needed for the repair I'm not paying taxes on his labor.


The only time something is taxed is when goods are exchanging hands and that's a one time tax. The seller of the goods doesn't pay a tax with his resale tax.

Not to go off subject, but my auto mechanic told me the other day that NC is trying to make a law where labor is taxed. So when they do my annual inspection or balance and rotate my tires, etc., they would have to tax us on the labor. And if we go in for repairs we would pay tax on parts and labor. Supposedly it's to help the poor counties bring in some money. Sadly, I live in the richest county in the state (though it only shows in the rich part of the county, Pinehurst, because it's a golf mecca and we gotta kept it pretty for all the golf snobs. But I digress.) so we wouldn't benefit from it at all. We're already taxed out the butt up here anyway and living in a 'resort' area makes it tough for us small folks. 

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Not to go off subject, but my auto mechanic told me the other day that NC is trying to make a law where labor is taxed. So when they do my annual inspection or balance and rotate my tires, etc., they would have to tax us on the labor. And if we go in for repairs we would pay tax on parts and labor. Supposedly it's to help the poor counties bring in some money. Sadly, I live in the richest county in the state (though it only shows in the rich part of the county, Pinehurst, because it's a golf mecca and we gotta kept it pretty for all the golf snobs. But I digress.) so we wouldn't benefit from it at all. We're already taxed out the butt up here anyway and living in a 'resort' area makes it tough for us small folks. 

That's bull. That's triple taxation. You're taxed on your income, you pay it to the mechanic, who is then taxed on labor, then the mechanic is taxed on his take-home pay, virtually all of which comes from that labor. I hope that bill fails spectacularly.

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That's bull. That's triple taxation. You're taxed on your income, you pay it to the mechanic, who is then taxed on labor, then the mechanic is taxed on his take-home pay, virtually all of which comes from that labor. I hope that bill fails spectacularly.

You and me both, my friend. We already change our own oil and do other minor stuff because the cost of labor is ridiculous. But we are required to do have annual inspections and there are some things we just can't do because we're neither equipped nor qualified.

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You and me both, my friend. We already change our own oil and do other minor stuff because the cost of labor is ridiculous. But we are required to do have annual inspections and there are some things we just can't do because we're neither equipped nor qualified.

 

Part of the problem with the cost of labor is due to government regulation.  Let's just say for example that the mechanic's wage is $15 per hour.  That's really not the cost for one hour of his time, that's just what he makes "cash wise".  The business owner, in addition to paying his salary has to pay taxes on his salary (SS), pay for workman's compensation insurance, any possible benefits (health care, 401k, vacation time, sick time, etc.).  The real cost for that employee for an hour of work to an employer is north of $50 per hour... just for the employee.

 

Then take into account other expenses that the employer has to pay.  Electric bill, water bill, inspection fees for fire safety, EPA, OSHA, etc.  You also have to figure equipment cost and maintenance.

 

Suddenly, $100 or more for one hour of shop time isn't really unreasonable, and that doesn't include turning a profit.

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There are 10 kinds of people in this world.  Those who understand binary and those who don't.

Part of the problem with the cost of labor is due to government regulation.  Let's just say for example that the mechanic's wage is $15 per hour.  That's really not the cost for one hour of his time, that's just what he makes "cash wise".  The business owner, in addition to paying his salary has to pay taxes on his salary (SS), pay for workman's compensation insurance, any possible benefits (health care, 401k, vacation time, sick time, etc.).  The real cost for that employee for an hour of work to an employer is north of $50 per hour... just for the employee.

 

Then take into account other expenses that the employer has to pay.  Electric bill, water bill, inspection fees for fire safety, EPA, OSHA, etc.  You also have to figure equipment cost and maintenance.

 

Suddenly, $100 or more for one hour of shop time isn't really unreasonable, and that doesn't include turning a profit.

Speaking from experience managing in the service industry (in California, no less), you're overstating things here. We charged $105/hr. for technician labor, and that brought in a healthy $35/hr. profit. That was after paying the employee (hourly+production), paying for materials, fuel, wear and tear on vehicles and equipment and general overhead. It wasn't car repair, but the basic structure of the organization and employee pay structure was about the same. The main difference was that we paid more on production than in base salary.

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Speaking from experience managing in the service industry (in California, no less), you're overstating things here. We charged $105/hr. for technician labor, and that brought in a healthy $35/hr. profit. That was after paying the employee (hourly+production), paying for materials, fuel, wear and tear on vehicles and equipment and general overhead. It wasn't car repair, but the basic structure of the organization and employee pay structure was about the same. The main difference was that we paid more on production than in base salary.

 

So you're telling me that the cost for the employee and other stuff amounted to $70 per hour?  I find that hard to believe.

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There are 10 kinds of people in this world.  Those who understand binary and those who don't.

So you're telling me that the cost for the employee and other stuff amounted to $70 per hour?  I find that hard to believe.

I don't exactly have access to the books six years after departing, but yeah, the cost for an hour of technician labor was roughly $70, a little more or less depending on how far the job was from the office, where their pay fell on the hourly and production schedules, but yeah, $70/hr was the cost we went with when figuring out bids and estimates, making $105/hr a pretty safe price point for labor on the majority of our bigger jobs and virtually all routine stops.

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Part of the problem with the cost of labor is due to government regulation.  Let's just say for example that the mechanic's wage is $15 per hour.  That's really not the cost for one hour of his time, that's just what he makes "cash wise".  The business owner, in addition to paying his salary has to pay taxes on his salary (SS), pay for workman's compensation insurance, any possible benefits (health care, 401k, vacation time, sick time, etc.).  The real cost for that employee for an hour of work to an employer is north of $50 per hour... just for the employee.

 

Then take into account other expenses that the employer has to pay.  Electric bill, water bill, inspection fees for fire safety, EPA, OSHA, etc.  You also have to figure equipment cost and maintenance.

 

Suddenly, $100 or more for one hour of shop time isn't really unreasonable, and that doesn't include turning a profit.

Like I said, we live in the richest county in the state that is also considered a resort area so the cost of everything here is more, plus NC likes to tax you to death for everything. For us small time folks, it's a burden. It's almost a backward thing where, instead of everyone having their wealth redistributed to pay for the welfare nation, everyone here is having to pay more so the rich folks have nice things. My husband was born and raised here and has 20+ years in local government employment so we aren't going anywhere anytime soon.

 

I don't have a problem with paying a fair price for labor, but it's pretty bad here and the proposed tax would make it even worse.

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It's of the cost in a labor rate has to do with the overhead. Techs make anywhere from $15-30 an hour on flat rate which is like piece work. That additional $85-$70 an hour and the parts mark up ( every part sold is marked up anyone that tells you different is lying) are to cover the cost of salary and hourly employees, overhead and profit.


Salary and hourly employees are your general service guys ( the oil changers, tire changer, every shop has them you have to them you can't bill a $30 an hour tech time to Change tires and oil all day) or front workers like service writers and managers.


Every garage operates for a 60% gross margin, that means if the job cost $100 in parts and labor it has to net $250 in return at minimum on average. So here's why you have a mark up on service when you get an oil change there's sometimes a $2 profit most of the time the garage will lose money on an oil change sale to get you in the door so that money has to be made back, tires there about a 20% profit margin there so that additional 40% has to come from somewhere.


The only income for a garage is the part markup and billed labor, naturally you can only mark a part up so much normally a price matrix of between 1.0-2.5 based on the purchase price is used the rest of that 60% margin has to come from billed labor. So back to my $100 example say where installing an external water pump, that water pump cost me roughly $35 so run it through the price matrix and sell it for $75 now I'm paying the tech an hour and half to install it my labor cost if he makes $20 and hour is $30 so I'm at a cost of the job being $105 I gotta make $250 there's your labor rate.


Any shop not maintaing a 60% margin at the end of they year isn't in business long, the equipment and cost of business is to high. Hell my alignment rack cost 80k I make that back $80 at a time.


It's completely normal for a garage to do 1.2 million in sales am only make 20k in profit on the pnl. Hell my old garage we did service exclusively didn't mess with tires which lowers you overall sales but increases profit margin and if didn't do at least 40k with a 60% margin we lost money at the end of the month that was a three man garage. Where in at now we have to do over 100k with the same margin to make money and even then the expenses can eat up any profit if someone makes a mistake.

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Back in the day, before the government got involved with 'helping' the under-served folks, churches provided for them and thus were considered charities even if that wasn't the word used to describe it.


Without trying to cross the COC line I will say this. The church I go to uses the tithes from the people to pay the electric bill and other bills associated with ownership of a building. Maintenance and such. The rest goes into our community and overseas charities (I guess that's what you'd call them). Our pastor has a full time job elsewhere and does not receive any payment out of tithes.


Saying all of that, would you consider them non-profit or charity?

I think based on my previous responses that much is obvious. Yes I do. I think the vast majority of churches do good charitable work and hold no ill will towards them despite accusations of some zealots on here.

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The Income Tax is not needed.  Read the Grace Commission Report. 

 

0% of collected Income Taxes goes towards any goods or services for the citizens.  It doesn't pay a single salary or build a single mile of highway.  It all goes to the banksters for "interest" on a "debt" they "created" out of thin air. 

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