Posted on 11/21/2004 12:10:21 AM PST by Remember_Salamis
MN Rep. Pushing National Sales Tax
Nov 15, 2004 10:27 am US/Central Minneapolis (AP)
Rep. Gil Gutknecht is pushing legislation that would replace the federal income tax with a national sales tax.
"Think of a world where there is no income tax, where you get to keep everything you earn and you pay the tax man when you buy stuff," Gutknecht, R-Minn., told the Star Tribune of Minneapolis.
Legislation co-sponsored by Gutknecht would scrap federal income taxes and replace them with a 23 percent federal sales tax (in addition to existing state taxes.)
Gutknecht, a member of the House Budget Committee, said he's "moved from a lukewarm fan to a fanatic" supporter of a national sales tax.
"First of all, it eliminates the IRS as we know it," he said. "That is a huge advantage. It simplifies things just enormously."
Gutknecht is one of more than 50 co-sponsors of the Fair Tax Act of 2003, which is sponsored by Rep. John Linder, R-Ga.
Under the plan, all goods and services would be taxed at 23 percent. There would be no exemptions, including for food and medical expenses, but some low-income people would be eligible for monthly tax rebate checks. An identical bill has been introduced in the Senate by Saxby Chambliss, R-Ga.
President Bush, who argues that the tax code is too complicated, says he will appoint a commission to study how it should be changed.
It's uncertain what will emerge, but tax experts say there are many options for simplification, including the creation of a flat income tax or a value-added tax on production or simply tweaking the existing code.
With Republicans increasing their majorities in the House and Senate, some changes are all but certain, said Bill Raabe, tax professor at Ohio State University's Fisher College of Business.
"If it's ever going to happen, now's the time," he said.
Some Democrats argue that a national sales tax would be regressive.
Sen. Mark Dayton, D-Minn., said such a tax would benefit wealthy Americans.
"Taxing consumption in an economy that is driven by personal consumption is a bad policy idea," said Dayton.
"It's clearly a regressive tax," said Rep. Martin Sabo, D-Minn. "You can put some credits in and probably alleviate some of the problems at the very bottom, but it ends up being a significant shift in taxes, if not to the very bottom (then) to the middle."
Minnesota Sen. Norm Coleman, a Republican, said he likes the simplicity of a flat tax. But he said he wanted to see what the presidential commission comes up with before endorsing a national sales tax.
-- I'm a FairTax Fanatic too!
bump.
We must do this now!!!!
23%!!!!! Why so high?
Oh goody! Another tax.
Yeah, 23% *in addition to state tax*. Not sounding so good to me. We're pushing 10% state tax here. Do I really want to pay a third extra for everything I buy? I'm thinking that I'm not gonna be buying much under this plan....
Good idea, but 23% is too high for me to jump on board yet.
I'll have to think about it. If income tax goes away, all of it, then I can see this working, albeit at a lower percentage rate. How does it impact corporations?
"First of all, it eliminates the IRS as we know it,"
as we know it
as we know it
as we know it
as we know it
When the IRS goes away, ANY WAY I could know it, hell will freeze over. While we're elminating the IRS, let's eliminate ATF. I can dream can't I ?
Instead of a national sales tax, it would be better to go to the funding the founding fathers initiated - tariffs. Think of it as a national sales tax on imported goods you buy. We could really have fun with France using tariffs!
I'd prefer a flat tax of say 13% starting at 15,000 to 20,000 income rate....everything before 15 or 20k is not taxed. Remove some deductions...make the tax form no bigger than a post card and I'm in.
23% national sales is far too high...it will never fly.
Sounds like a great idea to me. You're already paying that 23% elsewhere but it's hidden. At least now it'll be up front, and people will think twice about buying stuff.
Sure, I could see it working at a reasonable rate, too. I think it should supplant the state taxes, though. It's already a zoo with our current system. We have a high rate in my state, yet a neighboring state is about half. People drive there to buy things, so our state loses out completely. So, that is one way corporations are affected.
Cigarettes are taxed less there, too, so folks go to stock up on smokes. Then the state patrol catches them in "sting" operations, as it's illegal to bring more than a few across state lines.
Our tax systems are hosed up. I'd be up for a flat tax, too, if it were done at a reasonable rate.
It has to be high if you are going to get rid of the entire IRS and income tax.
My question is:
Why doesn't it have exemptions for food and medical expenses? That seems harsh.
To desensitize you for when they jack it up to 35%, then 45%, then 60%.
Be wary of the Kool-Aid drinkers. They know not what they do.
Because we have a massive federal government.
Because it's a regressive tax.
So you get the money that's normally withheld, but suddenly it buys LESS goods. Big-time recipe for inflation there.
I think this is our historical chance.
I'm with you all the way there. Going with a regressive tax will never fly.
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