Congress Must Pass the Fair Tax Act

CNSNews.com ^ | February 27, 2004 | Mac Collins (R-GA)

[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.)

[Fledermaus]

Admitted, sounds good in practice but so does Communism.

Sorry, that made no sense. I meant to say "in theory" not practice! oh boy!

[Taxman]

LOL!

Add your #7 to the list!

[kevkrom]

WHOA! Like that would ever happen. Federal tax, federal collections. And eventually, another IRS.

45 states (plus DC) already collect sales taxes. Why wouldn't they administer the NRST in their own borders, especially when they are compensated for it by a percenatge of the receipts?

They are politicians, they will change it, tweak it, change definitions of words, demagogue it, play politics with it, raise money from it, run elections on it.

I'm sure some will try. But income taxes are a shell game that are designed to allow for class warfare -- it's easy to manipulate them so that only one group or another gets a benefit or additional burden. With an NRST, however, anything they try like that raises the rate on everybody -- raise the amount of the FCA? The tax rate goes up on everyone. Exempt certain items from tax? The rate on everything else goes up for everybody.

Admitted, sounds good in [theory] but so does Communism

Communism doesn't even sound good in theory. The very core of its definition denies the worth and privacy of the individual in favor of a mythical "good" of the group. Why do you think income taxes are so popular among communists and socialists? They accomplish two things: income redistribution and subjecting individuals to government scrutiny.

[kevkrom]

Amazingly childish rant for someone so above it all

Funny, I thought it was just an analogy. Did it hit a nerve?

In case you can't read anything but your cut and paste shaman predictions

99% of the things I post on these threads are typed in directly in response to someone else. I did, once upon a time, have a cut-and-paste library to refute some of the blantantly false comments repeatedly posted by people such as lewislynn, but since he's stopped making those assertions, I deleted my files.

I choose to work on things which are just as important but which can be achieved.

That was Social Security reform, right? Where's the legislation (draft or submitted) for that? Who are the sponsors or potential co-sponsors? If you think playing with "the third rail of politics" is easier than reforming the income tax system, I have to assume you've made some pretty good progress to say that what you want can be achieved when the NRST, with already over 40 co-sponsors (including some moderate Democrats) is just "mental masturbation", as you so colorfully put it.

[kevkrom]

BTW, I'm all in favor of Social Security reform -- I just have the opposite perception -- I think it's a much more difficult task to significantly reform Social Security than it is to significantly reform the tax code.

If you do have a good proposal underway, I would still be interested in working with it in addition the the NRST, so links or adding me to bump-lists would be appreciated.

[Protagoras]

Funny, I thought it was just an analogy. Did it hit a nerve?

Add that to a long list of things you thought be weren't so. It was childish, born out of frustration over being exposed. The nerve it hit was yours.

[jimt]

It is surely the best way to fund government other than voluntary contributions.

[Protagoras]

Where's the legislation (draft or submitted) for that? Who are the sponsors or potential co-sponsors?

You are the cut and paste guy, go do your google search and you will find lots of proposed legislation, over decades, over most of the political spectrum, from both parties, which addresses the problem. It's clear that both main parties think it's a problem that needs to be addressed.

If you think playing with "the third rail of politics" is easier than reforming the income tax system,

Third rail? LOL, who's the coward now? The founders would be so proud of you!

with already over 40 co-sponsors (including some moderate Democrats) is just "mental masturbation", as you so colorfully put it.

This is rich. You would be lucky to get half of the sponsers to vote for it if it came to a real vote today. They would back track faster than a nimrod on the trail.

It will never get out of committee and they know it, as usual, they get to have it both ways. The oldest trick in the book.

[Protagoras]

If you do have a good proposal underway, I would still be interested in working with it in addition the the NRST, so links or adding me to bump-lists would be appreciated.

Excellent!

[Final Authority]

Regarding your reply 296, that is exactly why the idea in it's present form will never come to be. So I see you are coming around to reality. Based on the history of legislation in general, the concept of a sales tax will become another layer of taxation that the legislators can use to extract more money out of productive citizens to further their own power. The sales tax will be proposed initially as you suggest. The good parts will be spoken to such as the idea that a sales tax collects money from those who opt out of the present system of income tax and that will be the reason to enact a sales tax. It will be highly progressive where things such as food and certain clothing will be exempt but luxury items will be taxed heavily.

You won't recognize your baby after all is said and done. We will have just more tax to pay. The government will enslave us further and our freedoms and liberty will be proportionally diminished.

Calling for another form of taxation is just inviting the worst out of the legislature.

BTW, the government (liberals) do know who the "rich" are, they/we are the ones who get off our butt each day and go to work. We are the givers, they are the takers.

[phil_will1]

"Calling for another form of taxation is just inviting the worst out of the legislature."

Is your position consistent with respect to other areas of public policy? IOW, congress will muck up any new idea, no matter how thoroughly researched and well thought out, so there is little to be gained by promoting improvements in the public policy area. We are all victims of congress, subject to their whims, avarice and ineptitude and we have no mechanism whatsoever for controlling them. Is that your position, or does that attitude only extend to the area of taxation?

[Final Authority]

Regarding your reply 331, it is a good question that I have yet to consider but after just several seconds of consideration and by way of comparison of legislative bodies I think you may elicit some useful discourse.

I live in NH. Our state legislative body is essentially a volunteer government. Pay is $100 per year. We have no broad based tax or base for it identified. Generally speaking, we get good or even great government. Just the other day a bill was sponsored that would allow anybody without a felony conviction to carry a concealed weapon without any sort of registration or license. I like that and it is because the government listens to the interests of the citizens, not those who can broaden their power or make them rich, because there are few mechanisms, with the situation of taxation, where nearly all tax is locally raised and collected, to make law for the sake of getting rich or more powerful. US congress does this through appropriation bills payed for with excessive taxation, beyond the scope of the US Constitution, and by controlling the code of such taxation. Corruption is the money, taxation is the means. It will do no Senator good for his career to turn the system upside down with respect to taxation and spending. If you do not believe me, read about GWB. The only caveat here is that he wants us to believe we are being taxed less even as the expenditures rise. We or our children still have to pay for these unfunded spending bills.

So for your answer, the more money and power are concentrated in a government body, the harder it will be to do the right thing. If in fact they can appear to do some of the right things and in the effort increase the total taxation, they will. Outside of this, if there is an issue with little or no economic consequence or tax issue, it is possible for congress to make a decision favorable to our free republic. Such a decision is the debate and subsequent law forbidding late term abortion. I suspect very little pork was attached to that bill or poison pills in the form of unpopular amendments to cause the initial idea to become moot or to cause it's defeat. So, yea, Congress can do some things correctly, but not issues regarding taxation, at least as it applies to the intent of the founders, who after all fought the King over a tax of about 5%.

To go back to NH, it is said that the only way for a politician to become rich is to be involved with road construction in the form of graft and deal making, after all, it is nearly all federal money, and, by involving oneself with the electric power industry as the receipts are controlled by a government function. John Sununu Sr., former governor and consultant to the nuclear power industry, became a millionaire while in office. NH now has the highest electric costs in the nation, thanks to Seabrook Station and a crooked politician, IMHO.

[phil_will1]

"If in fact they can appear to do some of the right things and in the effort increase the total taxation, they will. Outside of this, if there is an issue with little or no economic consequence or tax issue, it is possible for congress to make a decision favorable to our free republic."

That may be true as long as we as voters tolerate it. The only effective defense against elected officials acting in their own benefit instead of ours is the ballot box. There are numerous examples of that mechanism working. For example, I am of the opinion that here in Georgia, that is exactly the reason that Max Cleland is no longer a US senator. He went to Washington for one term and voted in a manner inconsistent with that of those who sent him to represent them. Those same voters brought him back home after they realized the error of their ways. Some politicians are more skilled than Mr. Cleland at rationalizing their voting record, apparently. I cannot understand, for example, how the 2 Dakotas, which are strongly Republican, currently have 4 Democratic senators representing them.

[ChlorineHair]

Send your state's Reps a letter, and refer as many of your friends to http://www.fairtax.org as possible

It is a good place to start, and I don't think too many people who would be receptive to this idea really know about it.