Flat Tax System Imposed On Iraq

Washington Post ^ | 11/02/03 | Dana Milbank and Walter Pincus

[Principled]

My dream is a constitutional amendment that repeals income tax and authorizes sales tax.

This dream is not so far off.

There is no amendment required to authorize a national sales tax. They could put it on us tonight.

Nor is an amendment necessary to repeal, eliminate, and erase the entire income tax code. These two things are already in HR 25 the Fair Tax.

There is a sister bill (HJR 45 I think) that is an constitutional amendment that would do two things:
1) repeal the 16th amendment
2) make the taxation of any kind of income unconstitutional

Check it out.

[Principled]

It has been proven that the national sales taz approach punishes very low income the most.

Not the Fair Tax. Look here for how HR 25 treats the various income brackets.

[Principled]

http://www.fairtaxvolunteer.org/smart/faq.html

FAQ on the Fair Tax

[azcap]

You're illegal alien example actually makes the argument for the NST. Those people are paying zero income tax. They get paid and make their purchases with cash. At least with an NST when they made purchases at legitimate business - Walmart, Burger King, etc they would pay taxes. So would foreigner here legally on vacation or with work/student visas. The purpose of  changing the tax system isn't and shouldn't be to tax otherwise untaxed activities. The purpose is to get rid a of the liberty-crushing, economy-dragging income tax.

 

[July 4th]

Yeah, I'm not sure I get it either.

[meyer]

Reality is that illegal economies will be taxed more than before but large parts of them will still go untapped. But that's the nature of "illegal" economies. There will also be a huge increase in sales tax fraud (cash will truly be king!) All said it's miles better than whah we have now.

I contend that whenever taxes exceed what people think is fair, they will find ways to avoid paying, even if it involves bartering with their neighbor. The definition of "excessive" though varies from person to person.

[azcap]

I contend that whenever taxes exceed what people think is fair, they will find ways to avoid paying, even if it involves bartering with their neighbor. The definition of "excessive" though varies from person to person.

Perfectly said!

The question then becomes which system, the current income tax or an NST makes more people feel like they are overtaxed and thus are induced to tax avoidance. One of the biggest reasons liberals hate the NST is that there would be no withholding so people would see how much they really earn and in turn have to actually pay with money from their wallet the tax to run the government. This is a great thing if you are a conservative who wants smaller government. As for tax avoidance, who the tax cheats are would change. Wage earners and salaried workers who have their income taxes withheld and have their incomes reported on a W-2 have much fewer opportunities to avoid the income tax. Under the current system legal (and illegal) tax advantages are geared toward business people and investors. Under an NST, tax cheating would be more equal opportunity.

[meyer]

Frankly, I feel that both the NRS tax and the flat-rate income tax have their own set of advantages. Both eliminate much of the useless complexity of the present-day code. Both have an element of fairness in that neither allows politicians to essentially steal money from one group of people to buy votes from another - everyone is treated equally as they should be, subject to their own economic prowess.

Now the retail side of taxation has the benefit of being able to collect taxes from American and foreign labor somewhat equally. Since the tax is on the product rather than the means of production, American industry need not pay a premium to US workers to overcome the burden of taxation - a premium that makes job deportation more pleasant. Retail tax also gives the buyer the ability to directly control the amount of taxes they pay, through means of their purchasing.

Both plans have some small avenue for "cheating", and I can't really say which one might be more secure. But I can say that either plan would be a welcome alternative to the convoluted, inherently unfair, redistributing, overly complex method we use right now.

[Temple Owl]

I'm an economic conservative and the flat tax isn't my dream, the national sales tax is my dream. I'm repulsed at the notion that the government gets a cut of my income before I do.

I agree but i will hoist the white flag and accept a flat tax.

[GO65]

I could never understand why everyone wants to tax just flat things.... What about round, or irregular, or sherical?

Now that's funny. :-)

[GO65]

"Flat Tax System Imposed On Iraq"

Imposed??? Taxation without Representation!!!

:-)

[GO65]

As a conservative, I can only envy them for that. It has been proven that the national sales taz approach punishes very low income the most.

That depends on how you structure it. If you exempt food, medicine, housing and education, and offer an annual flat rebate (e.g. $5k per citizen), you would actually find that those on the lower end of the income scale pay little or no federal taxes.

[LA Conservative]

When it becomes more expensive for illegals to shop at legitimate stores like Burger King, they will more likely increase their consumption with the street vendors that line the streets of the LA Metro area, and completely avoid the tax.

It's unbelievable. You can buy clothes, sporting goods, food, flowers, produce, toys, in addition to stuff that's illegal to sell anyway.

I like the idea of a NST because it lets people have their money first, and allows them more control of their own money. I am not opposing the idea, I just questioned the assertion of a NST increasing participation in the tax system

[meyer]

It has been proven that the national sales tax approach punishes very low income the most.

No, it hasn't any more than a 15,000 dollar car "punishes" lower income people who have less chance of affording it. You buy what you can afford and strive to afford what you hope to buy. That is opposed to the present system of getting someone else to buy your stuff which is all the "progressive" tax rate does.

A national sales tax is inherently fair, as is a flat-rate income tax. In fact, one could argue that a flat per-head tax is fair as well.

[azcap]

LA could always shut down the illegal vendors (ha ha) but that would mean enforcing laws and if we are going to start enforcing the laws we wouldn't have 10 million illegal aliens in the first place. As long we are all fantasizing about flat taxes and NSTs we might as well fantasize about enforcing the border and deporting illegals.

[varon]

What about round, or irregular, or sherical?

Now you're getting a bit out of hand here if you think anyone's going to start taxing my donut holes..........na gona do it

[rwfromkansas]

Agreed.

www.fairtax.org

[rwfromkansas]

Normally, they are regressive in nature. But, not the FairTax since it has found a way to fix that problem.

[nmh]

All I would like to see is a flat tax, say 12% based on gross income.

[nmh]

"No, it hasn't any more than a 15,000 dollar car "punishes" lower income people who have less chance of affording it. You buy what you can afford and strive to afford what you hope to buy. That is opposed to the present system of getting someone else to buy your stuff which is all the "progressive" tax rate does."

Actually there was a study put out that showed lower income people would suffer more financially with a national sales tax. A lower income person is taxed more and they can afford it less.

I odn't mind giving those who are legitimately poor and doing all they can a financial break but the progressive taxes the hell out of the middle and upper class.