Op-Ed: Protect Social Security Now With a Federal Retail Sales Tax

releases.usnewswire.com ^

[ancient_geezer]

Regards 37 & 39

Tell us something we don't know. Like the tactical plan to implement your strategic goals:

We must adopt a constitutional amendment to both repeal the 16th Amendment and Article I. Section 2's reference to direct taxes. This amendment could mandate a national sales tax as the sole means of taxing individuals specifying upper limits on the tax rate.

We must adopt a balanced budget constitutional amendment.

 

You offer no tactical plan of action to get there (smaller government) from here (income taxes); History has amply demonstrated it ain't gonna happen with income and payroll tax statutes in place.

As a consequence the answer to your question:

What are the chances that this will be implemented by the jerks in Congress, who benefit immensely by the current complex system?

Is none until the people of the United States have the income tax horseblinders removed from their eyes and all perceive the real cost of government largess personally.

The Honorable James DeMint (R-SC)
United States House of Representatives
THURSDAY, APRIL 5, 2001
12:00 noon

• "There has been a shift in the relationship between individuals and government, he argues, such that fewer and fewer are paying taxes at the same time that more and more are receiving increasingly generous benefits. If it becomes the case that most voters do not bear a financial burden for this largess, then there will be little to restrain--and significant political incentives to encourage--the continued growth of government.

Politics operates on the basis of manipulating the perception of the burden of taxation:

A government which robs Peter to pay Paul can always depend on the support of Paul.
-George Bernard Shaw

Those who perceive little burden play the role of Poor little Paul:

 

Effective Individual Federal Income Tax Rate (Percent of gross income)
Income Category	1977	1979	1981	1983	1985	1987	1989	1991	1993	1995	Projected 1999
Lowest Quintile	-0.6	-0.8	-0.2	-0.5	-0.2	-1.3	-1.9	-2.9	-3.4	-5.6	-6.8
Second Quintile	3.6	3.9	4.6	3.5	3.9	3.2	3.3	2.7	1.8	1.8	0.9
Middle Quintile	7.1	7.5	8.3	6.8	6.8	6.1	6.5	6.3	5.9	6.1	5.4

Those that readily perceive some of the burden:

 

Effective Individual Federal Income Tax Rate (Percent of gross income)
Income Category	1977	1979	1981	1983	1985	1987	1989	1991	1993	1995	Projected 1999
Fourth Quintile	9.7	10.4	11.3	9.5	9.3	8.7	8.9	8.7	8.5	8.7	8.4
Highest Quintile	15.8	16.3	17.1	14.5	14.3	15.1	15.1	14.8	15.5	16.2	16.1

To play the role of mean ole Rich Peter.

While Congress plays both ends against the middle; hiding the real burden in inflation, higher prices on all goods and services, lower takehome pay, lower return on investment, and higher interest rates. All keeping the poor right where they are and pushing for more freebees.

We really pay:

Effective Total Federal Tax Rate (Percent of gross income)
Income Category	1977	1979	1981	1983	1985	1987	1989	1991	1993	1995	Projected 1999
All Families	22.8	23.4	23.5	21.4	21.8	22.6	22.5	22.6	23.5	24.7	24.2

Data from IRS collections statistics and The Bureau of Economic Analysis as compiled in tabular form by the Congressional Budget Office.
http://www.cbo.gov/showdoc.cfm?index=1545&from=4&sequence=0

To remove the perception of taxation of the individual, is to remove the goad which assures accountability of government to the electorate. Federal tax rates are high because a majority of the electorate do not share proportionately in the burden their demand for largesse imposes on the minority of citizens.

The siren call for representation without taxation is the formula that got us where we are at today. The ability to hide or disguise taxation from the view of large sectors of the electorate allows the Congress to get away with the creation of the evergrowing monster that it fosters.

Liberty and freedom have a price, responsibility. If that price is avoided there are no brakes on the growth of government, the ultimate result is the end of freedom through creeping socialism.

Right now the bottom 60% perceive little to no "Individual Income Tax" burden,(in many cases even a handout) and 70% of the voting public clamor for more from government looking for the top 40% of income earners/producers to foot the bill. That perception continues to grow ever stronger by eliminating even more participants from the Federal Individual Income Tax rolls as proposed in the tax reduction proposals through changes in personal exemption limits and other mechanisms such as the EITC.

The Intent of the individual income tax is for political and social control not revenue collection. The Individual Income tax is maintained to establish and hold every person in the country perpetual legal jeopardy. That is a situation that must end with the repeal of the income tax from the statutes, and the prohibition of its use by Constitutional amendment that future generations will not face the same manner of manipulation and interference in their lives.

Until you first remove the income/payroll tax statues and provide a viable alternative, you will never see any of the actions you propose come alive in reality. The will remain in the world of libertarian and utopian fantasy.

The NRST is the means to open VOTERS eyes to the reality and first step towards restoring a Constitutionally limited government. Without it, what you say you want will remain mearly a pipe dream.

[CIB-173RDABN]

Social Security is a ponzi scheme. There is not enought money in the world to keep it going forever. Anyone that thinks the problem with Social Security is lack of money does not understand the problem.

[ancient_geezer]

Disadvantages of a National Sales Tax

Nothing that you have mentioned qualifies as such under H.R.25

Sales tax rates based upon the Gross Domestic Product (GDP) may may need to be higher than stated since significant GDP spending is by the government.

Under HR25, government is required to pay the same tax as everyone else for this reason.

It pays those taxes today through the the prices it pays for consumption products (embedded income & payroll taxes passed on in consumption pricing), the NRST thus requires government to pay that same tax, in its payments for that same consumption (NRST plus income payroll tax free price).

Sales tax rates based upon the GDP may need to be higher than stated since prices of goods and services will likely decrease with the elimination of corporate taxes.

Since the prices of goods and services will decrease approximately 20-25%, the total payment of products remains the same as it is today, all that is different is is Taxes are stated separately from price on retail receipts instead of being embedded in price.

Secondly due to more efficient business operations with income/payroll compliance removed, productivity increases will provide additional incetives to economic growth.

Retailers would be required to collect and manage additional taxes for each sale.
Only 45 our of 50 states currently have a retail sales tax.
Will require Federal oversight of retail sales tax collection techniques.

At no additional cost as the bill compensates states and businesses to collect and remit said tax.

Exempted items (perhaps food products) may be taxed by the state, complicating the retail tax computations.

One of the qualifications for a state to assume the administrative and enforcement of the NRST, will be for it to conform its own structure to be compatable with the NRST. This will enhance most states own tax collections in providing a broader tax base as well as simplification of their own tax laws.

Support for churches and charitable organizations may decrease since contributions will not be tax deductible.

LOL, charitible contribution are not retail purchases, and are not taxed under the NRST either. No difference, except you don't have to tell the government about it to get a deduction so it is even easier.

Will be regressive in nature without rebates.

HR 25, provides a fixed payment at beginning of each month, no rebate based on expenditure or income at all.

It is to every legal resident to compensate for the loss of personal exemption and standard deduction of the income tax.

That payment is taxrate times the povertyline for one person paid monthly. Since povertyline is a fixed base measure adjusted for inflation, so is the compensation as is the tax being a percentage of consumer price by definition of what it taxes.

Rates over 15% may encourage evasion and require enforcement actions.

Any rate requires enforcement, DUH, Including the income/payroll tax we have today.

However, the enforcement is upon the seller of hew goods & services, and falls to less than 10% of the persons and entities that must be subject to such enforcement under the current laws.

Evasion might take the form of a growing black market

How is that? Evasion generally occures in attempts to avoid the high marginal rates of the income tax, more than 30% generally and as high as 40% in some instances with the income/payroll tax scheme in place. Secondly the income/payroll tax can be easily evaded by merely the artifice of doing everything in cash and not telling the IRS what you make. Only takes one person involved, keep your mouth shut and you can do it for ever.

Thus cash markets abound sapping at least 20-30% of potential tax dollars.

 

80% of retail dollar volume goes through on 20% of business, those 20% being the largest have the most to loose if caught not collect a tax from their customers or not properly remitting such to the state tax authority who knows them all very well.

for that 20% of retail dollar volume with the little guy, The NRST, is a single broad base tax, the maximum marginal rate is 23%. It takes two persons in collusion to cheat, (thus high risk for less gain).

Actual evasion is much more likely to fall rather than rise under the NRST.

[ancient_geezer]

Anyone that thinks the problem with Social Security is lack of money

Lack of money is not the problem, lack of visibility of the cost of government for such largess is.

See the content of reply #41 above.

An NRST provides a solution to the lack of visibility. It is up to the electorate to act on knowledge instead of out of government mandated ignorance as it does to day.

[af_vet_rr]

Does anyone really think social security is more important than ball players taking "performance enhancing" drugs or how soon we can get the iraqis broadband and digital cable?

The actions of our elected officials speak louder than their words.

They speak very loudly. Apparently steroids, cable TV, who's marrying who, educating the children of a few small towns in Iowa about the rain forests, putting up this or that statue commemorating some event or person that one out of a million might recognize, etc. are much more important than social security and national security.

[45Auto]

Look, we are both on the same side: limited, less corrupt government and more liberty is the goal. I have said for decades that the ONLY way to attain this goal is by somehow limiting the amount of money government can steal from those who earn it. The bastards derive their phony authority from the 30-50% of GDP that they steal every year.

I am absolutely in favor of a total reform of the tax system; I am even willing to try a national sales tax (although, I'd prefer a flat tax; there are still problems with that, namely, the need for the IRS) if it could be set up in such a way as to prevent later "reforms" from gutting it. I have been watching what happened in California for nearly 25 years after the passage of the Gann Initiative which set Constitutional limits on taxation/spending. Over the succeeding two decades, the RAT-dominated legislature (with the consent of several Repubo governors) completely destroyed the whole limitation-thing through a series of sneaky ballot initiatives and other legislation.

I have no tactical plan to assure a better tax system or a more honest government. I am a realist and, I assume, like yourself, I have been around long enough to understand that those in government will never give up their authority without some catastrophic event. The current tax code gives Congress exactly what it wants: unlimited power to divide, conquer and otherwise enrich itself at the expense of the nation. The RAT party exists solely because of the way in which each successive Congress since 1913 has "revised" it. Create a truly "fair tax" system, and the RAT party, as currently constituted, will sink into oblivion. Such a grand thought it is. However, you have correctly summed up the problem at its source: the ignorance of the average voter. Too many people think they have a vested interest in keeping the status quo. So, I agree that that must be where the emphasis must be placed. My cynical self, however, does not think it can ever be done in a peaceful manner.

[templar]

What would they use a Retail Sales Tax to do that for?

A record of every transaction of the business and with everyone that the business does business with.

[templar]

LOL, I read that book too, back in the 50's. Lost me alot of money and wealth over the years until I finally wised up.

Don't know what book you are referring to, but a lot of people who went from looking at retirement as millionaires to looking at retirement eating dog food with the collapse of Enron, Global Crossing, etc. might have benefited from it. Financial chaos does not mean the total collapse of the economy, it means that there will be a whole lot of big time losers and a very few who will be incredibly rich at the end of it, and that this will result in massive political changes (away from conservative ideas, not toward them). Examine the coming SS crisis for a while and give it some thought, things are going to go through some amjor (and chaotic) changes in the next dozen years.

[ancient_geezer]

A record of every transaction of the business and with everyone that the business does business with.

Let me see 1040 hmmm! against the dreaded state retail sales tax receipt:

Business name, how much tax, how much price, and total payment.

Now the NRST http://thomas.loc.gov/cgi-bin/query/z?c108:H.R.25:

`SEC. 510. TAX TO BE SEPARATELY STATED AND CHARGED.

• `(a) IN GENERAL- For each purchase of taxable property or services for which a tax is imposed by section 101, the seller shall charge the tax imposed by section 101 separately from the purchase. For purchase of taxable property or services for which a tax is imposed by section 101, the seller shall provide to the purchaser a receipt for each transaction that includes--

• • `(1) the property or services price exclusive of tax;

• • `(2) the amount of tax paid;

• • `(3) the property or service price inclusive of tax;

• • `(4) the tax rate (the amount of tax paid (per paragraph (2)) divided by the property or service price inclusive of tax (per paragraph (3));

• • `(5) the date that the good or service was sold;

• • `(6) the name of the vendor; and

• • `(7) the vendor registration number.

 

dang'd no consumer name there.

ROTFLM( | )O

[n-tres-ted]

Congressman Pat Toomey just signed on today. Toomey is challenging Snarlin' Arlen Specter for the Senate in the primary next month. HEY!! That's good news. Let's hope he makes it into the "club."

[templar]

dang'd no consumer name there.

You have a great deal of faith in the benevolence of the Federal government. I do not.

BTW, you're social security number can never be used for any purpose than Federal taxes. It's the law (it was passed that way). It cannot be used for any form of identification, especially not be required for things like your drivers license or State ID card.

Oh yeah, the background check records of you firearms purchases are destroyed immediately, never kept in a government database. And the BATF absolutely does not visit firearms dealers and make records of all the transactions from his 4473's to keep in some government database.

[ancient_geezer]

Don't know what book you are referring to

Name was "The Coming Economic Collapse" IIRC don't recall the author though was well know on radio at the time. First time I saw a version of it was back in the late 50's a standard paper back of the times along with the themes of end of the world from nuclear war, building your own bomb shelter etc. The dating and revision of the list of catastrophic portents changing only with each sucessive generation since.

Catastophe and gloom and doom have always sold and always will.

Scounderals will come and go and every generation sees their share of them. We had a $50Billion National debt back then Social Security was on the edge of collapse and it was the end of the world in a decade with a whole slew of corporate scoundrals to make news with and point out the evil of big business.

Now we have a $7 Trillion national debt Social Security near collapse and it is still the end of the world in a decade. Along with a new set of corporate scoundrals obsconding with peoples money through any number of schemes.

World will always have is scoundrels and we will survive them, slow scale changes in money supply/debt/wages/prices will be with us in the future, and always has been, just abit less volatile than they were pre WWI causing repetitive full booms and crashes.

Sorry, I have just learned over many decades of observation that watching for the next crash is a particularly fruitless and profitless endevour.

Wish I had been able to realise that when I was much younger and much more impressionable.

Yes I know the demographics and the economics of it all, the difference beween a gold standard and the fiat currency fractional reserve banking system of today. I've lived it and studied it without end, always expecting that catastrophe.

The one factor that I have learned, the nation adapts and changes in each successive generation, the dangers of yesterday are overcome or resolved without catastrophic consequence. The same is as true today and the near future as it has been for the last 70 years.

You will ignore this message and worry yourself to death over this generation's coming catastrophe, I'll be working to make the changes that help resolve them.

[ancient_geezer]

You have a great deal of faith in the benevolence of the Federal government. I do not.

Well, you have two choices, worry yourself to death over maybes and what might happen.

Or work to see they don't happen.

I have no faith in government, I do have faith in the electorates ability to make changes. I've watched it happen enough to warrant that faith.

BTW, you're social security number can never be used for any purpose than Federal taxes.

Yep that's what it says on the back of my card, LOL

Oh yeah, the background check records of you firearms purchases are destroyed immediately, never kept in a government database.

You go through background checks? Leave a tracable record of purchases? foolish you.

[templar]

You go through background checks? Leave a tracable record of purchases? foolish you.

I don't do background checks. Private saales and purchases are still legal where I live in spite of the Republicans. However, I have purchased a number of firearms from FFL dealers since '68 (since 71 actually, as I was in Nam early 68 till early 70). If you have, you also have left a traceable record whether you know it or not.

[ancient_geezer]

Ohhh my ohhh dear, lets see where was that last FFL purchase.

Sorry none there, can't help you out.

[templar]

Sorry none there, can't help you out.

We're gettin' way off off topic (admittedly my fault), and we're becoming contentious. We're both on the same side so maybe we ought to wait and discuss it another time when things develop further with the NRST.

[ancient_geezer]

Sounds good, and things are devoloping with the NRST, and HR25 so there will be alot of opportunity for discussion over the coming months.

Plenty of time as well as I do not expect movement until well into the next sessions of Congress. The base Critter support is merely being built at present, the real push comes later.

[Badray]

From what I was told, he signed on yesterday.

[Lancey Howard]

....will all other taxes be abolished and/or outlawed with the passage of this measure?

"No, it will be passed (assuming it is passed someday) as an additional tax. An idea whose time has come."

Are you drinking heavily tonight?

[ancient_geezer]

Yep, see it on Thomas now, 45 Co-Sponsors.

Only 55 to go for 100 by July 4th :O)