don't you know that the income tax and payroll tax are hidden in the prices of everything? Estimates vary around 20% for goods and 25% for services. Saved money is already going to get taxed under your fraudulent income tax status quo.
Your ambitious "reform" scheme is too extreme.
It'd be like throwing a car's transmission into reverse when you're still travelling forward at 55 mph.
More like shifting from low to high gears it looks to me:
Economic studies indicate repealing income taxes and going to a national sales tax would generate a substantial export boom; the level can rise as much as 30% percent above trade under the current tax system in the NRST's first year declining slowly towards a lower trade surplus in succeeding years as the dollar appreciates against foreign currencies encouraging increased investment in the business infrastucture of US.
As a consequence we would see the investment/savings rate almost double in the first year of an NRST over todays levels, both from foreign sources and domestic with spending on investment and industry given taxfree status.
As investment rises so does productivity, GDP and wages and consumption, with increases in GDP of approximately 15% over levels seen under an income/payroll tax system and consequent increase of standard of living.
Anybody who has managed to save money under the current set of rules would have that money taxed again when they try to spend it
DO YOU PAY YOUR INCOME TAX
AT THE SUPERMARKET?
by D. Sherman Cox J.D. L.L.M. Taxation
under your fraudulent proposal.
Nothing fraudulent about it at all, I assure you it is quite real and out in the open:
The original article written by Pat Buchanan back in 1991 that convinced many of us that the NRST was the wave of the future...
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A tax whose time has gone? As the tax revolt was "the" Idea of 1978 and l980 and term limitations "the" idea of 1990, a popular movement to abolish the federal income tax could be "the" idea of the decade. Mid-April is not a bad time to get a receptive hearing. First, some history. Until 1913 the federal government ran entirely on tariffs and fees. In those 13 decades from 1789 on, we went from being a small farming country to become the greatest industrial power on Earth - with growth rates unequaled since. In 1913, after passage of the 16th Amendment, a federal income tax was imposed. It amounted to just 1 percent for incomes in excess of $3,000 ($4,000 for married couples), with small surtaxes up to 6 percent on incomes from $20,000 to $500,000, the filthy rich. By 1950,an average US. family of four still sent only 2 percent of its income to the Treasury last year, however, the feds were taking 24 per-cent, which helps explain the Reagan Revolution. Comes now an idea for total abolition of the federal income tax, not only on individuals but on corporations, and of estate and gift taxes as well. Cost to the treasury as of 1990: $558 billion. How could the feds recoup that immense sum? Simple. Impose, at the retail level, a 16 per-cent Federal sales tax. Since goods and services exceeded $3.5 trillion last year, that 16 percent sales tax would fully compensate the US. Treasury for what was lost. While the idea is at first a shocker, consider the benefits. As consumption, not savings, would be taxed, the U.S. savings rate, an anemic 3 percent in 1988, would explode. Individuals who salted money away in banks, bonds and stocks would see at pile up, untaxed until they took it out and spent it. Corporations' would not only have $100 billion more in saved income taxes for research, production and marketing, they would have access to hundreds of billions more in a vastly enlarged U.S. savings pool. Since the corporate income tax, 34 percent, would no longer have to be factored into prices, U.S. goods would compete more favorably with imports. Subsidiaries of foreign firms, which now pay an average of 1 percent in corporate income taxes, would be required to compete on a level playing field. Foreigners buying our products and tourists visiting the United States would begin contributing to the U.S. defense budget. Illegal aliens would also begin contributing - on a par with U.S. citizens. The Internal Revenue Service, 94 percent of whose work involves income taxes, could be virtually shut down. Some 5.3 billion man-hours spent filling out income tax forms (at $10 per hour, that's $55.3 billion) would be saved. The underground economy that evades taxes on unreported transactions could not escape the 16 percent sales tax at the grocery store, restaurant, department store or auto showroom. A hundred billion in lost federal revenue would be captured. The feds would not have to bother harassing waitresses for what they think was their tip income; the ladies would simply pay their federal taxes at the department store counter, with no hassle. We would not have to gab about tax simplification, we would have it. Small business, already set up for imposing sales taxes at the stale level, would see accounting expenses disappear. Tax collection would be a piece of cake. Hundreds of thousands of IRS agents, tax lawyers, accountants could be released for more useful work. D.C. lobbyists who spend their days devising loopholes, congressmen whose PAC money depends on giving and withholding favors in the federal tax code, would become sit-perflucus [?] turn. Workers would take home all the money they earned, and hard workers all their overtime. Both would feel it each time they paid federal taxes; both would know whom to blame. The tax on work in the United States would be reduced to zero, on savings to zero, on investment to zero, making Amenca the mast attractive nation on Earth to work in, save in, invest so. Foreign capital would flood into the United States, creating millions of new jobs. Among the losers: Second, organized crime and professional cheats who now evade taxes by not reporting income. The mobster who pays no tax on his sale of 10 kilos cocaine could not avoid that 16 percent federal sales tax when he bought his Porsch, his powerboat, his pool and house. Third, bureaucrats would lose power over the lives of citizens that is theirs by virtue of their intimate knowledge of the wealth and income - and sources of same - for every one of us. Who would resist? Well, since a steep progressive income tax was one of the ideas advanced by Karl Marx in his "Communist Manifesto" - for destroying the bourgeois - his closet followers would fight to the bitter end. For the social levelers, a proposal to replace the federal income tax with a federal sales tax is The Little Big Horn. One political problem comes to mind: As the poor, thanks to the Regan tax cuts, do not pay federal income taxes, and the working class do not pay at 16 percent, they would at first appear to be net losers. This would have to be dealt with. But consider the upside. An economic boom - with no more audits, no more having to store vast records, no more having to answer indecipherable computer-written IRS letters, no more April 15 - Free at last! This article appeared in the Washington Times on April 17, 1991. |
And of Alan Keyes underscoring the time for the change is now:
Keyes on Taxes & Government Spending:
Alan Keyes Interview with Des Moines Register:
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The intent of the structure of the individual income tax is for political and social mainpulation not revenue collection. The Individual Income tax is maintained to establish and hold every person in the country in perpetual legal jeopardy and to create artificial divisions among the electorate (rich vs. poor; big business vs. the little guy; etc).
Considering those factors, it is always good to remember the philosophical roots of the left which can be found here: Manifesto of the Communist Party, by Karl Marx and Frederick Engels, published in 1848.
"Anybody who has managed to save money under the current set of rules would have that money taxed again when they try to spend it under your fraudulent proposal."
And they will have it taxed again under the current system. The biggest difference under the FairTax (to the extent that they purchase US produced goods) would be that the taxes they pay will be explicitly broken out and identified.
You don't have a problem with a more transparent tax system, do you, Willie?