Posted on 03/02/2004 10:23:45 PM PST by esarlls3
Congress Must Pass the Fair Tax Act
By U.S. Rep. Mac Collins
CNSNews.com Commentary
February 27, 2004
Past Congresses have moved in the wrong direction by making our tax laws more complex and expensive for business and individuals to comply with. To keep our economy growing, Congress needs to take action now.
My colleague, Georgia Republican Congressman John Linder, has sponsored the "Fair Tax Act" (H.R. 25), a national retail sales tax on new goods and services. It would replace all individual and corporate income taxes, payroll taxes as well as capital gains taxes, estate taxes and gift taxes.
The Fair Tax replaces the way we are currently taxed, which is based on our annual income, with a tax on goods and services. The Fair Tax, basically, is a voluntary "consumption" tax. The more you buy, the more you pay in taxes. The less you buy, the less you pay in taxes.
The federal government will continue to be fully funded, including Social Security and Medicare.
The Fair Tax will reduce the costs of goods and services by 20 to 30 percent. It will allow workers to keep 100 percent of their paycheck, pension and Social Security payments with the exception being state or local withholding
The Gross Domestic Product will increase by almost 10.5 percent in the first year after its enactment because real wages would increase and tax compliance costs for business would decrease by 90 percent.
The fair tax would also be good news for investors. Real investment will initially increase by 76 percent relative to investments that would be made under our present tax laws. While this increase will gradually decline, it remains 15 percent higher than under the existing tax structure.
American exports will increase by 26 percent initially and would remain more than 13 percent above present levels under the current tax system.
Studies of the Fair Tax have shown that many U.S. companies will choose expansion here in the United States versus abroad, and in turn the United States will become more attractive to many foreign owned companies looking for expansion possibilities.
President Bush, during his State of the Union address in January, said the economy is turning around because the American people are using their money far better than government would have. The Republican majority in Congress was right to return it to the American people and not keep it in Washington.
A fresh and a fairer approach to a Federal tax system is needed. Therefore, it is time for Congress to pass the Fair Tax (H.R. 25).
As a cosponsor of the Fair Tax Act, I have asked Chairman Thomas of the Ways and Means Committee to hold hearings on this vital legislation. I am hoping those hearings will get under way in the near future.
(Congressman Mac Collins is a Republican representing Georgia's 8th Congressional District. He serves on the House Ways and Means Committee and the House Select Committee on Intelligence.)
Yes, if they have hired their people on the predicate of supplying just that in a total salary package. Otherwise they would be sued into the ground.
The final refuge of someone who can't win on the merits: the personal insult.
Here's a nickel, buy a sense of humor.
But it is irrelevant, it's never going to happen, and you know it.
LOL, and you accuse me of using crystal balls. No I don't "know" that at all.
However, for those more interested in another view of the debate. I ran across this little ditty looking for something else.
The Economic and Civil Liberties Case for a National Sales Tax
Cato, May 11, '95
There are more sides to the issue than merely economic my freind, which is the main reason I will continue to sdvocate & support the NRST tax for however long it takes.
You won't live long enough, but hey, everyone needs a hobby!
Would single family home purchases be taxed?
A new built home on which NRST has never been imposed, yes. Homes in the resale market, no.
The rule applied to the NRST in HR25, tax once but only once. Any product or property sold with NRST, will never again be hit with an NRST. Residences existing prior to implementation of the NRST are grandfathered.
Yes, just like they are today. The land would not be taxable -- as it had been subject to past taxes, but any new improvements (such as a house) would be taxable. Houses, like everything else, would not be taxed on resale.
Again, remember that the income tax inflates today's price already. Add in all of the savings with 25% lower interest rates, and home buying should still be a good deal under the NRST. Ok, there's no income tax deduction for interest payments, but that's because you're already paying with pre-tax dollars under the NRST, as opposed to post-tax dollars today.
That would be a useful way to be engaged in something important.
As I see it, implementing the NRST provides greater reason for folks to privatize.
Not many people fighting for your reform with 70% of the voting public clamoring for more from government and paying little on their 1040's which is all they really notice if that.
Under the NRST that 23% becomes visible to every Tom Dick & welfare mother they ummm.
23%........... Effective total federal tax rate with respect to consumption expenditure
14.91% ..... rate if Social Security and Medicare were eliminated
14% .......... rate if Nat'l Endowment for the Arts were eliminated
11.9%........ rate if Dept. of Education were eliminated
10% .......... rate if welfare were eliminated
9.8%.......... rate if foreign aid were eliminated
etc.
No, your $200k home remains a $200k home. The current hidden taxes become visible -- that's pretty much it. Additionally, your interest rate drops by 25%.
By my numbers, that $200k financed at 6% is a monthy principal + interest payment of $1199.10, for a total of $431,676 over 30 years. That same amount at 4.5% (a 25% interest rate deduction) is $1013.37/month for a total of $364,813. That's a net savings of just under $67,000.
If the bill gets loaded down with poison pills, just deep-six it and try again like the gun manufacturer liability bill. How do add progressivity to a system where the government doesn't have the information on who the "rich" is?
I'd rather tilt at a windmill or two than just sit on the sidelines and complain about the people who trying to make something happen.
It's a good thing the Founding Fathers didn't have an attitude like yours. "Oh, it's just a pipe dream that we could ever break free of England. Let's just be good citizens and pay those tea and stamp taxes. Who knows what kind of mess we'd get into with independence?"
It's part of the standard detractor handbook. They start by misrepresenting what the tax will do, then, when presented with the facts, take them piecemeal and treat each fact as if it was somehow presented as the whole reason behind XYZ.
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