Posted on 04/04/2006 2:17:28 PM PDT by Eaglewatcher
The FairTax (HR 25 in the US House and S 25 in the US Senate) is a federal retail sales tax that replaces the entire federal income and Social Security tax systems, including personal, gift, estate, capital gains, alternative minimum, Social Security/Medicare, self-employment, and corporate taxes. The FairTax allows Americans to keep 100 percent of their paychecks (minus any state income taxes), ends corporate taxes and compliance costs hidden in the retail cost of goods and services, and fully funds the federal government while fulfilling the promise of Social Security and Medicare.
More FairTax benefits:
No tax on used goods. No tax on business inputs. With the FairTax, if you choose to buy any new good or service, the sales tax is charged just as state sales taxes are computed today. If you choose to buy used goods - used car, used home, used appliances - you do not pay the FairTax. If, as a business owner or farmer, you buy something for strictly business purposes (not for personal consumption), you pay no FairTax. So, in deciding what to buy, you get to choose whether or not you pay the FairTax.
No federal sales tax up to the poverty level means progressivity like today's tax system. Furthermore, to ensure that no American pays tax on necessities, the FairTax plan provides a prepaid, monthly rebate for every registered household to cover the consumption tax spent on necessities up to the federal poverty level. This, along with several other features, is how the FairTax completely untaxes the poor, lowers the tax burden on most, while making the overall rate progressive. However, the FairTax is progressive based on lifestyle/spending choices, rather than simply punishing those taxpayers who are successful. Do you see how much freer life is with the FairTax instead of the income tax?
All Americans take home their whole paychecks. Not only do more Americans have jobs, but they also take home 100 percent of their paychecks (except where state income taxes apply). No federal income taxes or payroll taxes are withheld from paychecks, pensions, or Social Security checks. Retail prices no longer hide corporate taxes or their compliance costs, which drive up costs for those who can least afford to pay. Did you know that hidden income taxes and the cost of complying with them currently make up 20 to 30 percent of all retail prices? It's true. According to Dr. Dale Jorgenson of Harvard University, hidden income taxes are passed on to the consumer in the form of higher prices - from 20 to 30 percent higher than they would otherwise be - for everything you buy.
Tax criminals - don't make criminals out of honest taxpayers. Today, the IRS admits to 25 percent non-compliance with the code. However, this does not take into account the criminal/drug/porn economy, which conservative estimates put at one trillion dollars of untaxed activity. The FairTax taxes those engaged in the underground economy capturing their income at the cash register. The substantial decrease in points of compliance - from every wage earner, investor, and retiree, down to only retailers - also allows enforcement to concentrate on following the money to criminal activity, rather than making potential criminals out of every taxpayer struggling to decipher the code.
The income tax exports our jobs, rather than our products. The FairTax brings jobs home. Most importantly, U.S. exports are not burdened by the FairTax, as they are with the current income tax. So the FairTax allows U.S. exports to sell overseas for prices 22 percent lower, on average, than they do now, with similar profit margins. Lower prices sharply increase demand for U.S. exports, thereby increasing job creation in U.S. manufacturing sectors. At home, foreign imports are subject to the same FairTax rate as domestically produced goods. Not only does the FairTax put U.S. products sold here on the same tax footing as foreign imports, but the dramatic lowering of compliance costs in comparison to other countries' value-added taxes also gives U.S. products a definitive pricing advantage which foreign tax systems cannot match.
YOU are in charge! The FairTax moves us from a system that taxes what we earn to a system that taxes what we spend. Under the FairTax, you control your tax liability, not the government. The FairTax puts "we the people" in charge of our money, and puts us all on the path to economic freedom!
To enact the FairTax and unleash the full economic potential of the U.S., we must apply Vocal and Persistent pressure on Congress each week.
Email, call or fax your members of Congress today. Send them this simple message: "Please support replacing the federal income tax code and become a co-sponsor of HR 25 or S 25, the FairTax."
Last time I checked, competition was a well-proven factor in lowering prices. Reduction in costs in a free market ALWAYS drive down prices. Business taxes are costs just as surely as raw materials.
Your ignorance of basic economics and business is appalling. Pointing to one or even a few monopolistic industries over a short time-frame is a facile argument. I could as easily point to the $300 PC that is 100 times more powerful than the $3,000 PC I used ten years ago. Or the $200 DVD player at home that I could replace today for $40. By your logic, the sellers of those items should have just retained all the additional profits as their costs dropped. Didn't happen. Called 'competition'. Look it up.
Or I could look at my own employer, a manufacturer of basic electronics components, and see that EVERY cost reduction we can achieve gets passed along to our customers -- because if we didn't, our competitors would take our market share in a heartbeat.
That is really frightening. If this "fair tax" scam depends on such a pipe dream, it is already dead because it would necessitate a police state of unprecedented immensity and the destruction of our republic.
I'll take, "Things I Will Never See In My Lifetime", for $1000 Alex"
When that money is spent, it will be taxed, but under the current system, the government is likely to grab more of it at some point. Yes, there is a trade off with some risk for some people.
But what you persist in overlooking is getting rid of the income tax and the IRS. The price of re-establishing liberty
is usually paid in blood. This will save that blood for current and future generations of Americans.
Can you even put a price tag -- in dollars -- for liberty? What would you pay to take the burden of our current system off of your children and grandchildren?
Maybe you are just assuming that all the 'old people' that you know aren't willing to help get the government off their children's back.
Odd, you claim I am 'wrong' but you do not dispute the point. The point was concerning the illegal economy, not compliance costs. I will concede there will be some compliance costs savings, much closer to $100 billion than $400 billion though. That is one significant advantage along with making our exports cheaper as another significant advantage. There are some attractive features to the sales tax, but it is rarely sold that way. The fairtax is usually marketed as a free-ride/everyone wins plan, which is bs. If you think you must spin the truth to be a conservative, than I suppose by your definition I am not. I personally hate the fairtax because it will be devastating to the new housing industry, which is my livelihood.
And you can say anything that you want to scare people away.
What the FairTax does is remove the entire infrastructure of the income tax. A seperate bill initiates the repeal of the 16th Amendment. Under the FairTax, the states will be paid for the collection efforts, (I don't believe that they are now) so the states won't object. The IRS is an multi billion dollar boondoggle that is a drain on this nation and suppresses the economy.
I have to believe that you are more interested in protecting a niche for yourself, because is you are honest, you will admit that we already have the two taxes that you fear will happen under the FT.
Let's be fair. Under the current system, I could earn $20K per year, pay zero income tax and even have an earn-income credit that gives me more money than they withheld for social security. So I don't have to be a homeless bum under the current system to be paying zero taxes either. Both systems are equally repulsive in that they must collect over $2 Trillion to pay for mostly socialism and government waste.
Good point: a person spending less than that gets money redistributed into his pocket. Another major negative: all we need is for every American to get used to cashing government checks.
The prebate is not a 'dole'.
The FairTax is not socialism.
You have things exactly backwards.
What is your benefit from the current slave tax?
That's what it promises. What it would do is something else again.
Odd that people really see a 30% tax on all new goods and services as 'liberty'. PS, the federal government will still be there watching over all transactions to ensure taxes are paid.
Remember, the States will still know quite a bit about your business -- how many employees and their wages, total revenue, industry, etc.
There's eleven states that do not have an income tax. It's widely thought that with the implementation of the FairTax most states will revert to the "FairTax" and abolish their state income tax systems.
The big picture includes tax competition among countries. The first industrialized country to replace their tax system with a "FairTax"/consumption tax will have an almost unfair advantage in gaining jobs and greatly increased economic growth. That will come at the loss to other countries. To remain competitive other countries will have to follow suit.
Its not a matter of if, but when the "FairTax"/consumption tax sweeps the world toward real economic freedom. The United States can follow or lead. It must take the lead. It leads the war on terrorism and leading the FairTax revolution with its new jobs and economic growth are strong allies in fighting fundamentalist-religious terrorism globally which economic freedom is the antithesis.
You need to hang with people who are more intelligent than your friend.
Currently, you can cheat all on your own without the collusion of anyone else.
With the FairTax, two or more people must be involved in order to cheat the system. Both run the risk of the other being 'the cop'. You won't even be able to trust him because he may be offering to find cheats to reduce his sentence after he gets caught doing the same.
Would you really risk jail to save a few hundred dollars or even a few thousand?
Perhaps I am not so fixated on doing so at any cost as some seem to be.
Maybe you are just assuming that all the 'old people' that you know aren't willing to help get the government off their children's back.
I think it is more like they are not willing to make it worse for their children than it already is.
See #76 and #82. Perhaps it is those 'old people' who are not so easily duped.
That is really frightening. If this "fair tax" scam depends on such a pipe dream, it is already dead because it would necessitate a police state of unprecedented immensity and the destruction of our republic.
I used "if the illegal economy remains static" to make an equal comparison to the point that $400 billion dollars in compliance cost would be gained. The FairTax doesn't rely on the illegal economy being static. It is beyond absurd to think the illegal economy would remain static. Thus your strawman premise is beyond absurd as well as your fabricated knock down of it.
Prove to me that you really aren't as obtuse as I believe you to be.
Which will result in lower taxes paid by an individual?
Would you rather pay taxes that amount to as much as 50% of what you earn?
Or 30% of what you spend?
The VAT already does that, which is why Greenspan supports a consumption-based tax like a VAT or sales tax. In some ways it is amazing that America has stayed competitive with Europe since our products have embedded taxes and theirs have much of them taken out when they are exported.
Considering how obtuse you are, that is an impossible task.
Which will result in lower taxes paid by an individual? Would you rather pay taxes that amount to as much as 50% of what you earn? Or 30% of what you spend?
No one pays a 50% tax on what they earn even at the highest marginal rates, so your premise is bs. Besides you really need to look at effective tax rates, not marginal rates to do a proper comparison. Anyways, the fairtax promises to be revenue neutral, so on average people will be paying the same. That said, the fairtax must still collect an additional $500 billion to pay for the family prebate, so it is actually much more than revenue neutral. Of course you are too obtuse comprehend.
Don't bring a knife to a gun fight.
Always Right: You are not gaining a dime from the illegal economy, 69
Zon: If the illegal economy remains static the economy gains from not paying $400,000,000 (four hundred billion) compliance cost.75
Always Right: Odd, you claim I am 'wrong' but you do not dispute the point. 85
I most certainly did. I refuted the point. Then you contradict your self when you say:
I will concede there will be some compliance costs savings
I refuted the point you made and you conceded. And you contradicted yourself. You can stop shooting yourself in the foot anytime now.
You're a hoot!
I personally hate the fairtax because it will be devastating to the new housing industry, which is my livelihood.
Nice to know your motive. What do you do in the new-housing market? I disagree with your opinion on the effect the FairTax will have on the new housing market.
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