Posted on 04/20/2009 3:15:05 PM PDT by pissant
This is a new book that I have co-authored with Hank Adler, a professor at Chapman University's business school, a post he took up after retirement from a long and successful career as a partner with Deloitte.
Hank and I undertook this project because we had --independent of each other and for different reasons-- arrived at the same conclusion: That the "Fair Tax" proposal put forward by my radio tal show host Neal Boortz and Congressman John Linder is a disastrous mirage that far too many Republicans have been drawn too, and for all the wrong reasons. "The Fair Tax" is a hopelessly flawed fantasy, but one with a surface appeal of simplicity that attracts especially politicians in need of energetic volunteers and quick headlines. But if the "Fair Tax" becomes the "Kemp-Roth" of the next few years, the GOP will be rightly punished at the polls as the details of the plan make it to the desks of serious political and economic analysts and from there to large numbers of voters who will examine the plan carefully and reject it almost immediately upon doing so. In short, not only should Republicans and conservatives not endorse the Fair Tax, they ought to affirmatively disavow the plan and press instead for serious and thoroughgoing tax reform, including lower and flatter tax rates.
Fair Tax enthusiasts often call my show and demand that I "read the book," by which they mean one or both of Neal's books. We have, and they do nothing to persuade serious readers of the plans merits, but much to camouflage the scheme's many deeply embedded flaws. Henceforth I'll be able to respond "Yes, but have you read the book that exposes the Fair tax as a destructive fantasy it is?"
(Excerpt) Read more at hughhewitt.townhall.com ...
Compared to the rest of the population they will spend a greater proportion on medical costs and health care than thirty somethings.
Believe it or not, this is why health insurance rates are so much higher for older people.
That greater spending on those necessities will mean the people who need to spend their money on health care will pick up a greater portion of the tax burden as they are taxed on that larger proportion of health care when they pay the bills.
How will the "average poverty level" need for health care be figured?
On the average population, which this group is not.
Last time I checked, health care is not really an option.
Again, I will bring up the example of someone who is injured in a car accident. They will require more health care, at more expense, and at a greater tax burden than the averabge person will pay. Nice way to kick someone when they are down, can't work due to injuries, etc.
Your lovely system departs from being "fair" if anyone is somehow a little bit away from "average poverty level" in their basic needs, and there are entire groups who are.
The only people fooling themselves are the fair taxers.
The so-called embedded taxes will remain by having their names changed from corporate income to sales taxes, while maybe set at a lower rate, will still be collected. Sort of like a VAT.
People that jump up and down talking about some "pie in the sky" have, in the course of history, always suspended belief and history to further an idea that sounds good but will only work in a vacuum without the vagaries of man.
Just trying to get a Constitutional Amendment through that will repeal the current income tax and implement the fair tax will never have enough words built in to not have loopholes big enough to drive a Mack truck through. Thus enabling politicians to do what they always do, steal our money to further their personal agendas and consolidate power.
Also, I do not support people who start out at the gate by lying to the people. The tax is a 30 percent tax, not 23, and no amount of dissembling or talk about "embedded taxes" make the initial lie right. Obfuscation is not the way to get people on your side and there are still enough educated people out here who can still understand simple mathematics to know they are being lied to once again. If you want it at 30 percent then stand up and tell people it is 30.
Source, please.
And as you're sourcing it, keep in mind my precisely chosen phrasing: the FairTax is the only retail sales tax EVER that is calculated as tax inclusive.
Nope. You are 180 degrees out of phase and wrong about that. But it's because you don't know me and you don't know my situation. You are assuming I'm an employee.
Under the FT, my 'take home', so to speak, would decrease significantly.
And probably the #1 reason for the Fair Tax...
survey says...
The government no longer has the need or the right to know anything about your income. How you made it?, Who paid you?, What you did?, etc...
We need to get the government out of our lives. Does anyone actually trust the government anymore? You know how you restore trust? You remove the opportunity for them to violate your trust.
A flat tax, etc would require you still to identify your sources of income, etc...there is no need for the government to know any of that.
Freedom = Government out of your life!
Do you honestly believe that businesses will not start fiddling with pay rates to ensure they start getting even more money than it SHOULD give them.
I am partially retired and for the first time in my life work with younger, and some older, people who's career zenith will be working at a 7-Eleven or maybe waiting tables (I am their boss).
Most of these people have no concept that the company they work for pays anywhere between $25 to $30 per hour for their $9 to $10 per hour job.
I have tried to explain it to some and their eyes glaze over because they are just not educated enough.
To the point, I fully believe that many companies will not only pocket their portion of the taxes but will actually reduce hourly wages by saying that since they will pay no income tax they will get less per hour.
Man is NOT honorable unless he strives to be and too many have no faith to be honorable.
Also, too many citizens make so little money that they either pay no taxes or their effective tax rates are somewhere around two to three percent.
They will walk into a store, or try to purchase that used car to get to work and take the kids to the doctor and such, and see that the prices are more than their supposed pay increase by not paying income taxes.
No matter what, the fair tax will end up being manipulated by politicians and lawyers to screw us even more. Heads in the clouds, or good intentions, do not make good policy.
Unless we find a way to get rid of about 65 percent or more of Government at all levels no new tax plan will succeed in relieving our tax burden.
While I am wholly in agreement that government needs to be minding its Constitutionally mandated business--and nothing else, which would immeasurably reduce the tax burden at the Federal Level, I would like for you at consider a couple of things.
It has been asserted that the black market would just go away under the fair tax, but I think just the opposite would happen. Given the opportunity to get 30% off on anything, especially expensive stuff, people will do a lot to get around paying that extra money. They drive miles out of their way to buy tobacco on Indian Reservations now to avoid tobacco taxes, so I'd reasonably assume they would do the same for similar savings on other common consumables, from food to toilet paper.
I think that absent enforcement, the black market would blossom.
Which means there would have to be enforcement.
So how would that be done?
You would have to be able to prove every item, or at least an 'average number' of consumable items you purchased had had the fair tax paid on them.
You would have to produce receipts to show you had paid the tax or be subject to prosecution.
Jackbooted thugs could come in with a warrant and riffle through your files, junk drawers, and the like to get the goods on your goods--and do the same to the retail businesses who sold one too many 'demo' automobiles, one too many 'floor sample' sofas as used merchandise.
I don't think for a minute that tens of thousands of Federal enforcers, accountants, and the like are going to go quietly into the night of unemployment. Oh no.
Things would be more invasive as they track your purchases, subpoena your credit card records, inquire as to what you bought when and where and what you paid for it, rummaged through your banking records looking for withdrawals that add up to the cash-under-the-table kickback that got you that dealer demo muscle car for 30% off. Etc. etc.
I think you folks are a little too far out in la-la land on this and I'm trying to get you to wake up and smell the human nature on both sides of the chain link fence.
I'm not having any luck so far, but it is interesting.
According to the actual analysis done by the fairtax research, they actually assume your take home pay stays the same, that is because that $12,500 is part of the embedded tax that is removed from the cost of goods. That is the only way to remove the so-called embedded taxes and keep prices from raising after the fairtax is enacted, and that is what their fairtax experts have admitted doing. Practically, there is no way for that to happen, but that was the FAIRTAX ASSUMPTION in doing their research and economic predictions.
It is impossible to have a fair tax unless the government first has fair spending. This country needs a constitutional amendment enjoining the federal government from enacting any spending bill which does not directly benefit the entire country. No special projects for special people and special states.
No thanks. I don’t want the Federal Government to own every square inch of the United States.
We will still own our land? Yeah. Well, try not paying your property taxes (rent to the government) and you will see who already owns “your” land. If you have to pay for it every year or have it confiscated “for taxes,” it’s not yours.
Surfer makes great points in #28 too.
Point me to a link that shows how the constitutional amendments would read that would prevent them from passing cigarette taxes, or taxes on fatty foods, or prevent them from making sales of windmills exempt from the Fair Tax.
You’re wrong, but I’m pretty sure I can’t convince you otherwise and I don’t feel inclined to try. As the saying goes “... and the pig likes it.”
Your aim is wrong. The Fair Tax people are beyond hope. Best thing to try for is to educate the people they're targeting with their deceptions.
They already exempted educational expenses from the current fair tax legislation, so meddling with the tax code has already begun before the bill has even been debated on the floor of Congress.
Wrong about what?
And referring to me as a pig is a low-life thing to do. You don’t have the chops to effectively debate the subject, but you’re calling me a pig? That rates at least one giggle on the Laugh Scale. (I’m laughing at you, not with you.)
You lost the debate on at least two counts, but you apparently don’t have the personal integrity to admit it.
No kidding. People will be reimbursed before they pay the tax,Reimbursed before?...Fairtax double talk.
On day one, where does all the (gag!) "prebate" money for every household in the nation (and beyond) come from before one dime of Fairtax is collected?
Or maybe people who expect to get an income tax refund from the year before won't get one...But that wouldn't be a (gag!) prebate would it.
*****Crickets*****
When I was in college we had a Communist, real, hardcore little red book quoting communist spewing proletariat this and bourgesoie that. He could not answer a question in his own words. It did not take people long to pick up on that, and subsequently dismiss his balderdash.
(8^D)
This is almost as much fun.
Yes, bad things happen if you don’t pay your taxes. If I don’t pay my property taxes under the current system, the sheriff would comes and auction off my property. So, by your reasoning, I don’t own it, right now.
Actually, this is quite true. What I own is a “bundle of rights”. Under fee simple this bundle is extensive, but not absolute. Try building on the land you own without getting a permit, and conforming to zoning. Even if you jump through all the right hoops, government can still take your property through eminent domain for the “greater good”.
Single taxers simply want to subtract one more right from this bundle. That is the right to collect rent from the land (and only the land, not improvements.) At first glance, their proposal seems radical. However, it offers a plethora of advantages. Not the least of these is that for most citizens, it will greatly reduce their tax burden without diminishing legitimate government services.
As the old real estate saying goes, the value of real estate is determined by three things, location, location, and location. What makes one location superior to another. To a great extent, it is the community around it. Most of us want to live in safe neighborhoods, close to transportation, good schools, good restaurants, cultural attractions, etc. These are all amenities that society contributes to the value of our property. It is a matter of fairness that society is repaid through the rent on land.
So if I pay $30K taxes on $100K income what tax rate am I paying?I see why you're confused. You don't pay $30,000 on $100,000 income, you pay $30,000 of $100,000 income.
Income tax is paid as a percentage OF not a percentage ON.
This is comparing inclusive rates and exclusive rates.No it isn't. It's a simple excercise in grade school arithmetic...Adding the word "income" does not make it a tax rate.
You can not have an exclusive rate on income. Income taxes are paid FROM income not on income.
Sales taxes are paid by the consumer ON the sale not from the sale.
The Fairtax rate of "23% of the gross payments" is written for the seller, not the buyer.
The seller/retailer totals the taxable sales, then sends the government 23% OF his gross taxable sales.
For the business to not lose money the business would have to impose a 30% tax ON the sale.
Of and on...words mean things.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.