Posted on 08/10/2004 7:08:18 PM PDT by NormsRevenge
NICEVILLE, Fla. (Reuters) - President Bush (news - web sites) said on Tuesday that abolishing the U.S. income tax system and replacing it with a national sales tax was an idea worth considering.
"It's an interesting idea," Bush told an "Ask President Bush" campaign forum here. "You know, I'm not exactly sure how big the national sales tax is going to have to be, but it's the kind of interesting idea that we ought to explore seriously."
Republican economists who speak regularly to the White House have said that the Bush campaign has been mulling the idea of an overhaul of the tax code as part of an agenda for a second term should Bush win reelection.
Some lawmakers have floated ideas of simplifying the tax code by putting in place a "flat" income tax rate or a national sales tax. But those ideas have so far not gained much traction in Congress. Opponents say such a system would not be in the best interests of the poor and the middle class who would pay the same tax rate as the wealthy even though they have less disposable income.
Oh, please.
Read the bill. It does none of the things that you are crying about.
It's HR 25.
This is the best thing since FreeRepublic.com
Actually, you can expect the exact opposite to happen.
Workers will have 100% of their federal paycheck -- meaning that they will have anywhere from 60 to 100% more money in their paycheck than now. Prices will fall by about 20 to 30% when the plan kicks in because the imbedded costs of the current tax system will no longer be part of the car's price. The net result will be the car is priced the same including the federal tax and the consumer has more money to pay for it.
Changing to this form of taxation will generate more economic activity than you can imagine.
Please, do yourself a favor and read the bill and the research behind it. The bill is HR 25.
There are currently 56 cosponsors of HR 25 - The FairTax Act. If the House tried to add this plan without killing the Federal Income Tax first, they'll withdraw their support. The intent of this bill is to eliminate the Federal Income Tax and the IRS. A companion bill will set the wheels in motion to repeal the 16th Amendment.
Where did you get this information??? I have to see this with my own eyes! $90,000???!!!!!
BINGO!!!! FInally, an issue worth serious debate. Either a flat tax or a value added tax in PLACE of the graduate income tax. Now there is an issue.
If they are smart or we force them to, it'll be the best thing to happen in years. Just imagine keeping your entire paycheck, reporting (and proving) your earnings to no one, and deciding for yourself how much tax you'll be paying. Under the FairTax, only new goods are taxes. Read the bill. It's 140 pages replaces the 40,000 page current tax code.
I'm not exactly a Bush fan, but if you recall there has been a few things on his plate the last 2 years.
I'm told that he supported the plan when he took office and was about to come out in favor of it. After we were hit on 9/11, he put it off until his second term.
I'm as skeptical and cynical as the next guy, but I see no reason to mistrust the timing on this. The support in the House has grown from 8 to 56 cosponsors this year and is still picking up new support. That's probably why he is more comfortable talking about it now. It's more feasible now than ever before.
A flat tax not only does not rid us of the IRS, but will soon revert to the mess we have now. Half of all lobbying dollars in DC are spent to effect the tax code. That won't change with a flat tax. The FairTax imposes one rate on all new goods with no exemptions and no deductions.
Off the top of my head, the FairTax eliminates:
The Federal Income Tax
Payroll Taxes - FICA / Medicare
Estate Taxes
Gift Taxes
Capital Gains Taxes
Corporate Income Tax
Self Employment Tax
Alternative Minimum Tax
(1) The 16th Amendment is totally repealed and the IRS completely abolished
This is accomplished by a companion bill to be passed at the same time. Keep in mind that it will likely not be ratified at the same time because the process is quite different - going state by state. But, also keep in mind that there is NOTHING to stop then now from adding a sales tax on top of the income tax, except US.
"(2) Corresponding cuts in government programs and the phasing out or elimination of Social Security/Medicare/Medicaid
This is a REVENUE bill. It has no effect on spending.
Before we will ever get a handle on spending, we must shift to this type of tax system where everyone pays. When over 40% of the people are not paying -- exempted or cheating -- they neither mind or care about the cost of government. They will have to pay for it before they care what it costs. This is the plan (HR 25) to make that happen.
"(3) The rate should be a low 15% with NO deductions or exemptions of any kind
The bill has to be revenue neutral. To achieve that, the rate will start at a much higher rate (This was my original objection too. I've since realized that this is the best plan to accomplish all of our goals -- short of bloodshed, that is.) There are no exemptions, no deductions, and only one rate for everyone. Prices will also fall to reflect the elimination of the imbedded cost of the current tax system AND you will have much more money in your paycheck with which to pay for your purchases.
"(4) The NRST must be levied on the FINAL purchase of goods and services, and not during production thereof, which is what a VAT is and which is widely used in socialist Europe
The tax is only on new goods by the end user. This is NOT a VAT. Business taxes are abolished for the simple reason that businesses merely collect taxes, they don't pay them. They are passed along to the consumer in higher prices, the shareholders in lower dividends, or the employees in lower wages. All three passthroughs are destructive and make us uncompetitive here and abroad.
Are you ready to sign on now? ;-)
No, compliance would be like the 98% compliance with the sales taxes that the states already leavy.
By the way, you are misinformed about the NRST. Check out WWW.FAIRTAX.ORG
pings needed here...
This is a good point. Much tax revenue is lost through under-the-counter income (ranging from sales of illegal substances to plain old paying off the books) which means that those of us who have legal, indentifiable incomes all end up paying more. Putting tax collection at the point of purchase would mean that even the scammers would finally pay.
"Even the illegals we have to support would have to pay a little."
Actually, they would have to pay a LOT, at least relative to legal residents. Because you have to have a valid SSN to file for the rebate (or Family Consumption Allowance), illegals would in actuality be paying a higher effective tax rate than the rest of us.
"...he has to be crazy to talk about this.....why doesn't he just talk 100% of the time on how weak a leader Kerry would be in the war on terror."
I watched in horror and amazement in 1992 as the 1st Bush campaign unfolded. People were hurting and fearful about the economy and everyone in the country seemed to understand that except the President and his economic advisors. I had to restrain myself on several occasions from throwing something at the TV screen when one of them quoted some obscure economic statistic to deny that the economy wasn't functioning well.
I don't know that many Americans understand that fundamental tax reform is just about the only arrow in the public policy quiver that will have a significant positive effect on the economy's performance, but some of us do, and the President's remarks are very encouraging to us.
BTW, running only as an effective war leader didn't prove a winning strategy for the 1st Bush, did it?
"NRSTers, we've crossed the tipping point for FairTax support: Hastert, DeLay, Cheney (he said it was a good idea a year or two ago), and now maybe Bush. 4/5ths of GOP leadership is now on board."
You can add Sen. Orrin Hatch to that list. He was quoted in an article as saying that he was going to get rid of this abominable code or die trying and that an NRST was the best alternative. I'll post the article separately.
If GWB were to throw his full support for abolition of the IRS and the current tax structure, propose an alternative (NRST as an example) and bring SS reform into the campaign, well JFnK wouldn't stand a chance at winning 10 states worth of electoral votes!
Here's the article:
http://www.freerepublic.com/focus/f-news/1189301/posts
Where have you been hiding? Most states have sales taxes and they expect their residents to pay the sales tax on out of state purchases. If your caught not paying them, you can become a sentenced felon!
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.