Posted on 02/03/2005 9:54:12 AM PST by EternalVigilance
CONGRESSMAN STEVE KING INTRODUCES RESOLUTION TO ELIMINATE IRS
WASHINGTON - As W-2s arrive in mailboxes this week, U.S. Congressman Steve King has introduced a resolution to repeal the 16th Amendment to the Constitution, which gives Congress the authority to collect income taxes.
H.J. Res. 16 would eliminate the IRS and the means for the government to collect income taxes.
"The IRS is an out-of-date, trillion-dollar-a-year drag on our economy," said King. "Instead of continuing to band-aid our complicated, leaking tax system year after year, we can choose a permanent solution and finally rid Americans of the fat leech they feed their paychecks to."
King has been a long-time supporter of the FairTax, a national sales tax placed on goods and services, which would replace the income tax.
H.J. Res. 16 must be approved by two-thirds of both the House and Senate, and then sent to the states, where three-fourths must ratify the amendment.
For information on the FairTax, visit:
http://www.fairtax.org
U.S. Congressman Steve King
Iowa's Fifth Congressional District
1432 Longworth House Office Building · Washington, DC 20515
http://www.house.gov/steveking/
Those who were being built or which had been built but not sold at the time of the FairTax implementation are eligable for a credit.
One is the transitional inventory credit, and is creditied against the NRST collected from retail sale of a new built home to compensate for the income/payroll taxes paid on taxable property built for sale under the current tax system and sold within two years of NRST implemetation. It amounts to the NRST that is associated with the cost of manufacturing the item for sale.
The other credit available to be applied against NRST on sales or rental of properties is the Business/Mixed use conversion credits where a property not held for business use, is converted to use in a business context such as in use or inclusion into products for sale or rental. This credit has no time limits on it and amounts to the NRST on the fair market value of the property at time of conversion to business use.
Thanks.
Your simple explanation is appreciated. I don't think anyone EVER thought there wouldn't be someone to collect the taxes or enforce tax law. No one said that or implied that. It is absolutely necessary that the rule of law apply to whatever changes are made and enforcement is a part of that. The presumption is that the IRS (or whatever agency collects the taxes) will have a much much shorter leash and have far less influence on the lives of individuals. In the case of the Fair Tax, retailers collect the taxes just as most of them do for cities, counties, and states.
I wasn't being sarcastic with you in asking you to further explain your opinion. I am a large advocate for the Fair Tax and am open to all questions and reasonable opinions concerning the plan. I believed you'd have some sort of reasonable objection. I have my own. For instance I believe there needs to be an addendum to either amendment idea that dictates that raising taxes should adhere to the rules of other super majority votes. In this case I want Congress to possess a super majority vote to raise the National Sales Tax.
I thought I made it clear that I respected your opinion. And I also thought it was obvious that others found your statements vague. I know the government eats money and they also possess the power of ultimate coercion. I believe the right to voluntarily pay taxes is as fundamental as the right to speech and self-preservation by means of arms. I believe the right to choose what I do with my earnings (life) as long as I perpetrate no force or fraud on any others is as real as your right to worship G_d as you see fit. I like to think of myself as realistically idealogical and maybe even a little credulous, but not dim.
Keep me posted.
I think you would prefer me to say that a sales tax and VAT are economically equivalent and leave it at that. You would prefer to keep the terms separate to maintain the distinction of differences in the mechanics of the two taxes.
The purpose of my extended presence on this thread is to demonstrate that there really isn't an economic difference between a sales tax and a VAT. It appears that the overwhelming majority of people don't understand that. In reality, the VAT and sales tax have nearly the same effects on the macroeconomy. Where there are differences (and they are minor to trivial indeed), the VAT is superior.
The sales tax proponents will tell you that there is a big difference between a sales tax and a VAT. Either they are economically illiterate, or they are plain old deceitful.
I will, my friend...I will...
You are calling me and others either ignorant or deceitful, but you failed to address my questions completely about why in the world we would want to trade simplicity and efficiency and visibility for a chance to tax ourselves like the French do.
You point out that the final tally of tax collected is exactly the same, and claim superiority for the VAT, but fail to show a single way that it is superior.
Liar. As has been demonstrated time and again, taxing at each stage of production is vastly different and more subject to abuse than taxing once at final point of retail sale.
Your deceit is noted.
Isn't the lack of accounting exactly the point. Granted there will be dark days for CPA's and tax attorneys.
Do you really think that my Congressman, Baghdad Jim McDermott, would be worth contacting?
I agree with you on this point. The 30% differential is enormous -- and it will exist, because properties that are bought for commercial purposes do not have to pay the 30%. The law of one price won't be able to close that tax gap, as it should otherwise tend to do as other posters have argued.
There will always be that 30% difference -- by law -- in homes bought by consumers for residences, and homes bought by businesses as an investment. It's part of the design of the Fair Tax, and I find it one of the worrisome points about this particular version of a NRST.
It never hurts to let them know that we are watching. If all else fails, it'll annoy the heck out of 'em...
I would agree with all of the above statements with the following caveats: There are different types of VATs and not all are consistent with the above statements. Also, in terms of the VAT for which the above statements are most true, I would not necessarily concede that it is superior to a RST. I understand, at least to some degree, where they differ, but it sometimes comes down to a matter of opinion, as to what feature is a benefit vs a detriment and which quality outweighs the other's overall.
The sales tax proponents will tell you that there is a big difference between a sales tax and a VAT. Either they are economically illiterate, or they are plain old deceitful.
As I understand it, the credit-invoice VAT is nearly identical to a RST, and I agree there is a lot of misunderstnading about that. I misunderstood it until a FairTax opposer was patient enough to convince me otherwise. I think the misunderstanding comes from the fact that there are VATs which ARE VERY DIFFERENT from a RST, and people learn about those and think that's what a VAT is, not realizing that VAT is a broader catagory than just one implementation.
Yes it does take an "R" behind the name,
because nobody with an "L" holds congressional
office, save for Ron Paul, (R).
First, a VAT is more efficient. That means less evasion. Therefore, the rate can be lower for the VAT than the sales tax.
Visibility is a non-issue. A VAT can be made visible.
From the viewpoint of the consumer, simplicity is not an issue. From the viewpoint of the producer, yes, they will require an extra column in their Excel spreadsheet. The difference is trivial.
Which VATs are you thinking about? To me, there is so little difference between a VAT and a sales tax as to not warrant distinction at the macroeconomic level.
Are you claiming that the switch will dramatically increase the GNP and taxable expenditures? Or that I have no right to skepticism that it will?
Here are some differences of the VAT (credit-invoice) over RST:
An equivelent VAT to the FairTax would collect tax at every level of production at a rate of 23% inclusive (or 29.78% exclusive). Each seller would monthly have to remit the difference between all VAT collected, less all VAT paid, to the collection authority.
This is an advantage in terms of verifying an audit, since you can verify tax paid by cross referencing a company's vendor's invoices.
This is a disadvantage because it means someone you do business with getting audited will almost assuredly open you up to the cost of an audit, as well.
It is an advantage in terms of enforcement in that you the enforcement authority has the ability to audit EVERYONE in American industry.
It is a disadvantage because now EVERYONE is subject to audit.
It is a disadvantage because there are more people to audit.
It is a disadvantage because rather than having to keep records of retail sales only, everyone has to keep records of every thing they sell, and how much tax they collect, as well as everything they buy, and how much tax they paid... ergo compliance costs would be greater.
It is an advantage in that people evading the tax by not charging, or collecting but not reporting, would still pay tax on their expenses.
I'm sure there are some more.
Some VATS do not credit you back the tax you pay. In that case the taxes cascade through the production tree, and end up more than the nominal rate by the time of consumption.
Also, some VATS are hidden, rather than visible. I suppose you could have a RST which was hidden, but the FairTax requires all receipts to show the amount of tax paid.
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