Thanks, Geez, I'll keep an eye out for that. Should be interesting to see how many are on board with it this time ( many more, I would guess). I still oppose your insistance that government will extract more than 30% relative to household income. I have yet to see any calculations that prove the excessive cascade effect mentioned so often here, or the hidden negative effects discussed here. As always, if those numbers could be presented I would be happy to check them out and cease this argument altogether. But honestly, this argument appears to be nothing more than paranoia and opposition based on whole hearted support of a competing plan (NRST). As I've stated before, Fair Tax, should it pass, would be a far cry better than what we have, I just don't think it goes quite far enough in avoiding evasion. While nowhere near as complex (and therefore porous) as our current code, it's complexity still lends itself to loopholes that by the very nature of capitalists will be exploited. As to your argument of excessive tax collected under APT, an adjustment to the rate would correct that as soon as accurate data is calculated. As always, thanks for your help.
I still oppose your insistance that government will extract more than 30% relative to household income.
The APT claims to be revenue neutral, that means the revenue collected will be equal to the revenue collected under the current system.
All taxes ultimately are incident upon the individual, either by increased prices, decreased wages, decreased returns on investments, or a combination of all.
Thus the average burden is calculatable knowing spendable income and total government revenue collected out of the economy.
The APT expects to be applied at both federal and state/local level thus the following Total tax as % of spendable income(NNP) applies.
refer Tax Freedom Day 2004 PDF http://www.taxfoundation.org/sr129.pdf
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Total Effective Tax Rates by Level of Government |
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| Year | Federal | State | Total |
| 1997 | 21.8% | 10.3% | 32.1% |
| 1998 | 22.4% | 10.4% | 32.8% |
| 1999 | 22.5% | 10.4% | 32.9% |
| 20000 | 23.1% | 10.4% | 33.5% |
| 2001 | 22.2% | 10.5% | 32.7% |
| 2002 1 | 19.7% | 10.2% | 29.2% |
| 2003 2 | 18.5% | 10.1% | 28.6% |
| 2004 3 | 17.9% | 10.0% | 27.9% |
| Notes: Leap day is omitted to make dates comparable over time. Since depreciation is not available to pay taxes, GDP is an overstatement of spendable income for the purpose of measuring tax burdens. Depreciation is netted out of NNP. 0 Last year of Clinton administration when of HR25 rate estimated Sources: Office of Management and Budget; Internal Revenue Service; Congressional Research Service; National Bureau of Economic Research; Treasury Department; and Tax Foundation calculations. |
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, I just don't think it goes quite far enough in avoiding evasion.
Evasion is not the issue we should worry about, unbounded growth of government at the expense of the economic health of the nation is.
But even as far as evasion and avoidence go, the big corporations will execute vertical mergers creating megalopolies to reduce their turnover, (i.e. the number of taxable transactions in their business) hence the tax incident on themselves, the little guy will simply head for the the underground cash and barter economy to avoid not the tax but the hassle and intrusive character of government that of necessity goes with any turnover tax. The response to the VAT throughout the EU and in South America with the Bank Account Debit taxes in driving the little guy underground is more than adequate evidence of that particular response yield evasion rates as high as 35% of GDP.
As to your argument of excessive tax collected under APT, an adjustment to the rate would correct that as soon as accurate data is calculated.
Revenue neutrality is all that is need to understand the burden on the citizen, which is shown above. Only people can pay taxes, business and market activities are merely mechanisms which are used by government to effect social and economic control and while collecting taxes from the people.
Sorry can't buy your APT at all, it puts too much capacity for unobservable mischief into the hands of the government bent on expanding it power.