King Bill to Repeal 16th Amendment to Constitution

Americans for Fair Taxation ^

[Wolfstar]

I hope with all my heart that this passes the House. It would almost certainly be filibustered in the Senate by Leftist Dems, probably aided by the more liberal Republicans. Two-thirds of each house of Congress must vote "aye" in order for Constitutional amendments to pass. As much as I want to see the 16th repealed, it would be extraordinarily difficult to do.

[EternalVigilance]

Even forcing a vote, win or lose, is very useful.

I want votes on the records of Democrats in defense of the IRS...

The voters aren't going to like that very much when they learn of it.

[Raffus]

I guess we can old hope, pray and thank God that the President is a "down to earth" type of guy.

God Bless this Republic.

[OHelix]

No caveat required. No credits. No forms. No nothing. All VATs are border neutral including the flat tax and sales tax.

I don't think that is true. If the tax is acumulated through the production tree, there must be a way to credit that acumulated tax back when it is exported. And in some implementations, I don't know how one would cascade those credits back down through the production tree acurately.

Do you understand international economics? I'd have to get into current accounts and capital accounts to explain it to you.

I don't know what you are refering to in regards to current accounts and capital accounts. I'm certainly not well-read in the topic. I don't know how to guage how much I so or don't understand intuitively.

[OHelix]

This is another piece of misinformation originating from the sales tax advocates. A sales tax cannot capture illegal transactions like a drug sale. The drug dealer is not going to collect and remit a sales tax.

But what about when the drug dealer buys a loaf of bread? Well, that is not the underground economy. That is the legitimate economy. The bread transaction will be captured by a sales tax, VAT or flat income tax.

I don't think the point of the FairTaxers is that the underground would not be able to avoid taxation in terms of collecting tax. It's that under the current income tax system they pay NO tax, under the FairTax, they will at least have to share the tax burden when they engage in the legitamate economy. It doesn't FIX the problem, but it improves it to some degree.

[OHelix]

That would be a political killer. Imagine how Democrats would say that everyone pays the same rate for sales tax. Why do high income earners get larger accounts than low income earners? Their disingenuousness would rival that of the "Fair Tax" supporters.

I expect you're right in terms of how it will be spun, however, the fact that wealthy people consume more than poorer people, would indicate they would pay more taxes. Further, the FairTax would spread the burden of funding SS from a limited base of wage earners, such that imports, foreigners (legal and illegal), and those who do not report or pay under the current sytem, would share some of that burden.

[OHelix]

It doesn't matter what the drug dealer buys. Yes, I will argue that if the drug dealer buys a fancy car, that a flat tax, VAT or even the current income tax will capture that transaction.

I would agree that both the FairTax or a VAT would capture it, but I don't know how the FlatTax would.

[OHelix]

That is because the flat tax is inherently border neutral. No need for forms, credits, rebates or anything.

That is not my understanding. Please explain.

[OHelix]

What you are ignoring is that there are two criminals in a drug deal, the seller and the buyer. Currently the buyer pays taxes on the income he is using to buy the dope, he wouldn't be with a NRST/VAT. A NRST/VAT would capture it's revenue from the dealer but lose it from the buyer. It's a wash.

Good point.

[Raffus]

All I have to say is "bingo". I'm not a ECON major (only ACCTG), but it is pretty common sense that this Fair Tax makes sense. It's FAIR! What is wrong with that?

[Paul C. Jesup]

No, there was a ruling of the Second [not Ninth] Circuit this week, which some tax protestor types are proclaiming as some great victory against the IRS, even though (a) the protestor who brought the case actually lost, and (b) the Second Circuit merely repeated what the Supreme Court held 40+ years ago.

Two words: Dredd Scott.

Just because the Supreme Court ruled one way 40 years ago does not mean it will rule the same way now.

[Lurking Libertarian]

Since the IRS was the one arguing for the result which the tax protestors are now calling a "victory," the odds of this case ever getting anywhere near the Supreme Court are close to zero.

[OHelix]

I'm mulling this over. I certainly agree that the dynamic you cited compensates significantly for the perceived benefit in terms of the underground economy. However, in the legitimate economy now, both the buyer and the seller pay income taxes, under the underground economy now, only the buyer.

Also, I think that there would still be an additional net benefit under FairTax in relation to your observation, in terms of drug deals at least, since arguably a significant number of people who buy drugs do so with criminally obtained money, which would still be untaxed under the existing system.

[Paul C. Jesup]

Keeping your head in the sand is not going to protect you from the tornado that is coming.

[Wolfstar]

The voters aren't going to like that very much when they learn of it.

EV, the vast majority of the American public hasn't got a clue that this debate is even ongoing. They are accustomed to the income tax, probably have little, if any knowledge of its history, and think their "refund" is a government savings system. There has to be a lot of groundwork laid with the American public to prepare them for a possible repeal, as well as for what would replace it.

If this ever happens at all, we are many years away from it.

[OHelix]

I would encourage you to read over the threads debating it, and maybe even the FAQ from the FairTax.org. This is a very salable tax system. Even if, for the sake of argument, the FlatTax is a better system than the FairTax, it's just not salable.

George Bush has Tax Reform on the table, and I expect he's going to do SOMETHING. The only question is, which plan? There is a very good chance SOME reform plan is going to be pushed through. Currently, the FairTax is the frontrunner.

[skinkinthegrass]

Thanks, for the links. :^)

[Bigun]

We are not sacrificing freedom by having an income tax...

Whoa! I generally don't participate in these threads delving into the economic minutia of tax reform but I cannot ignore that little ditty!

How can ANYONE presume himself to be free when some outside agency, with the ability to enforce the claim, has the ability to lay an APRIORI claim to the fruits of his labor?

[MindBender26]

Great idea, no chance.

Income tax is no longer a mechanism to just tax.

With its credits and allowances, it is a system of welfare unto its own. The poverty pimps would never let it go.

In addition, accountants and tax lawyers would lose billions of dollars of income every year. They will fight this to the end.

Like I said, Great idea..... no chance.

[Bigun]

...do you know of any countries with a cascading VAT?

Indeed I do! The United States of America currently has a cascading (subtraction method) VAT. Although we don't CALL it a VAT the current corporate income tax functions EXACTLY in that manner!