Posted on 08/01/2004 6:08:53 PM PDT by NeoCaveman
A domestic centerpiece of the Bush/GOP agenda for a second Bush term is getting rid of the Internal Revenue Service, the DRUDGE REPORT has learned.
The Speaker of the House will push for replacing the nation's current tax system with a national sales tax or a value added tax, Hill sources tell DRUDGE.
"People ask me if I’m really calling for the elimination of the IRS, and I say I think that’s a great thing to do for future generations of Americans," Speaker of the House Dennis Hastert explains in his new book, to be released on Wednesday.
"Pushing reform legislation will be difficult. Change of any sort seldom comes easy. But these changes are critical to our economic vitality and our economic security abroad," Hastert declares in SPEAKER: LESSONS FROM FORTY YEARS IN COACHING AND POLITICS.
"“If you own property, stock, or, say, one hundred acres of farmland and tax time is approaching, you don’t want to make a mistake, so you’re almost obliged to go to a certified public accountant, tax preparer, or tax attorney to help you file a correct return. That costs a lot of money. Now multiply the amount you have to pay by the total number of people who are in the same boat. You can’t. No one can because precise numbers don’t exist. But we can stipulate that we’re talking about a huge amount. Now consider that a flat tax, national sales tax, or VAT would not only eliminate the need to do this, it could also eliminate the Internal Revenue Service (IRS) itself and make the process of paying taxes much easier."
"By adopting a VAT, sales tax, or some other alternative, we could begin to change productivity. If you can do that, you can change gross national product and start growing the economy. You could double the economy over the next fifteen years. All of a sudden, the problem of what future generations owe in Social Security and Medicare won’t be so daunting anymore. The answer is to grow the economy, and the key to doing that is making sure we have a tax system that attracts capital and builds incentives to keep it here instead of forcing it out to other nations."
I agree with you on this, but retirees with savings outside of retirement plans will be adversely affected and they are not a small group either.
Tax overhaul just means more tax bracket reform.
I would like to see Bush push for more.
if a retailer doesn't make any profit he'd still have to pay taxes?
"But there is also no denying that in that situation, the tax would be regressive."
There is PLENTY of argument as to that point. A regressive tax is one in which those at the lower end of the spectrum (income or consumption, whichever you choose), pay a higher percentage than those at the higher ends. As the graph shows, those at the lower end have a NEGATIVE effective tax rate. Noone else has a negative tax rate. If you want to say that those making enormous incomes can choose to live below the poverty level so that they can enjoy the same negative tax rate, that is rather far-fetched, it seems to me.
"The assumption (inherent in this graph) is that all income is spent in ways subject to the NRST.
If that does not happen, the tax becomes regressive.
That is undoubtedly a desirable feature when one is focused on encouraging investment.
But there is also no denying that in that situation, the tax would be regressive."
-- That's totally false. For a family of 4 at the poverty line to pay the same tax rate as a family of 4 at $100,000, the family with $100,000 would have to spend less than 25% of their income on items subject to the NRST. Comapring somebody at $50,000 (consuming 100%) and $100,000, the $100,000 family would have to spend less than 50% of their income on items subject to the NRST. Comparing $50,000 (consuming 100%) and $75,000, the $75,000 family would have to spend less than 2/3 of their income on items subject to the NRST.
The NRST is flat-to-progressive. What's great about it is that you essentially choose your own tax rate by deciding what type of lifestyle you want. If you make $100,000 but don't want to pay taxes, live like a pauper and only spend up to the poverty line.
LOL!
If you say so.
But now you're nitpicking about mafia-built houses, like it's 911 or something.
Step back and look at the big picture. Then go to fairtax.org and READ IT!!
Stop being so suspicious. I was a skeptic at first too, but I'm telling you, it makes sense.
I don't care who says or does what, congress critters will never vote to curtail their power or revenue.
Yes, if he spends money that he didn't earn.... (?!?)
The first three words unlock the key to fixing the majority of problems in this country, including our system of taxation.
IMO, the majority of people do not understand the power they have. When they realize THEY are the ones with the power, not politicians and certainly not unelected judges, problems are well on their way to being solved.
IF the President strongly campaigns for this he could succeed in giving the American people a stronger gift than that of physical security. He would be helping to reverse power from the government to where it rightfully belongs- The American people.
"I submit that it would never happen at all...38 out of 50 states? Too much opportunity for obstructionism."
Then the FairTax would be repealed and we would go back to the old system. And those who obstructed would have to answer to their constituents.
"I agree with you on this, but retirees with savings outside of retirement plans will be adversely affected and they are not a small group either."
-excellent point. Everybody with a 401(k), and IRA, or a pension will greatly benefit from the FairTax. Only Seniors who unfortunately stashed their savings under their matress for 40 years will take a hit. Fact is, most retirees wil greatly benefit.
AFGE (American Federation of Government Employees) is shitting over the possibility.
I'd be less suspicious if you could show me a country that has already adopted a NRST. That's much more convincing than some paper that predicts this and this will happen or some congressman who thinks the DJ will double.
"if a retailer doesn't make any profit he'd still have to pay taxes?"
-- Under the FairTax, he would merely remit what he collected from his customers. How it will work is that the government will take 23% of total sales, not profits. It is up to the retailer to charge enough to compensate themselves. If that ends up being even, then you have no profit. If you make a profit, you don't even have to tell the government, jsut keep it for yourself. So as soon as you give the government 23% of your sales, your done dealing with taxes.
"He would be helping to reverse power from the government to where it rightfully belongs- The American people."
Worth repeating. What we are talking about, ladies and gentlemen, is simply the largest single transfer of power out of Washington back to the people in the entire 200+ year history of the republic. In that sense, it would be contrary to recent political history, where power has been concentrated in Washington.
It would also be the biggest economic stimulus and job creator that that the federal government could implement.
The consumption will not be flat at $100,000, to be sure, but the more one makes, the smaller their portion of total income is consumed in a year. A regressive tax is inevitable in the higher income brackets.
An argument may very well be that certain people, like him, may suffer through a little more taxes through a switch - there is no question that this is true for his case - but it is worth it for the long run, and this argument may very well be correct, BUT in his mind, he has already paid a lot for the good of this country, with most of his previous income taxed at the highest rate. Now, he would be asked to pony up again for the good of the country.
Let me say this - I know that I and most people will benefit greatly by switching, and I want to do everything possible to help move to the NRST, but we shouldn't be ignorant of some of the problems, especially if these problems bring substantial resistance to a change in the tax system.
Goebbels, meet everybody. Everybody, meet Goebbels.
I see your point over the short term, but I'm looking at it long term. What would be the incentive to keep the current border? Technically they would add lots of money to the coffers (so why not let them in)and it would be "unjust"( In my mind's eye I can already see a kerry or kennedy look alike stating it) to prevent a taxpayer from reaping the benefits of what he pays. And while to the educated person it may seem like a large tax burden to come to the USA under such a scenario, I think some dirt farmer who's starving or making 10 dollars a day in some factory shipping parts to the US isn't going to care.( I can be dirt poor down in mexico or I can be poor and unmeployed in the us and possibly on the dole) Doesn't seem like much of choice. Also your comparison is faulty because you assume they would pay the illegals on the same scale. If you calculate them paying the illegals at a 1/2 the rate the incentives are the same or greater. But again I'm not that knowledgeable on the subject its just that if I was a poor mexican i would take my chances in the US regardless of any alleged tax burden. Better to be poor and eating than poor and starving. (and if they feel otherwise I would be either real scared or real happy because that means we are on the same economic level as mexico)
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.