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"The IRS is an out-of-date, trillion-dollar-a-year drag on our economy," said King.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/
That is another indication that income taxes are not part of the price of production.
"It doesn't matter what you or I favor. Government doesn't cut or eliminate taxes.
They will find a way to scam us out of more of our money."
“I discussed the importance of abolishing the income tax because of its tendency to form a habit of servility in the souls of a people that accept it. Servility of soul is bad not only in itself, it is also an open door through which will soon walk the abuses of ambitious government power. Leaders who find themselves with governmental power over a servile people will be quick to conclude that such a people exist to serve them.”
Alan Keyes “The Power of the Purse”, WorldNet Daily, August 27,1999
No these taxes come at the end of it all or not. IF a business is profitable the tax implications must be faced but not as a business decision. No matter how much profit there is it is taxed at 38%. So if your profit is $1 your concern is to increase both it and the tax paid. But there are no decisions you can make to change that 38%. Zero tax means zero profit.
"It would be too easy to overlook or forget about the extra 23 cents we pay on each dollar of purchase, because we're getting something we want or need as the primary result of the purchase. But writing a big check at the end of every month would get people's attention, and make them think about wether or not what they're paying for is something they want or need."
Now THERE's a different form of resistence than I have encountered before. The more typical response is that the rate is so high that it will create a black market and/or a precipitous decline in consumption that would lead to a recession or worse.
Could it be that the truth is somewhere in the middle? Could it be that the FairTax would greatly stimulate the economy because of the price shifts which would make US goods more attractive around the world and that, even though there would be some initial sticker shock that would lead to some decrease in consumption, that effect would soon be overcome by an economy that is booming because of all the producers expanding in the USA?
It is unlikely you pay enough RE taxes to educate ONE student much less several.
But the real point is you have an interest in having educated citizens in this country. YOUR life would be much worse because the country would be much worse without the education the work force must have to keep this economy productive and creative. Our military was educated almost universally in public schools paid for by RE taxes. An excellent investment perhaps the best you will ever make.
There is truth in the warning against being Pennywise and Pound Foolish or against cuttin off your nose to spite your face.
Your "an IRS loving RINO"? I would have never suspected it :^)
It's interesting how quick the promoters are to pounce on someone when they're wrong...untill the poster is wrong/confused about the rate.
It's too bad the other promoters of this plan, some who have been doing it for yrs., some who are even paid to be here can't be honest enough to point out the entire truth about the plan ...begining with the rate structure itself.
Thank you.
King Ralph's first cousin twice removed...remember the John Goodman movie from the early 90s?
Support for this sort of thing can build over time. Your ignorance of the political process is no excuse for your attitude.
No, sir. My point has nothing to do with how any other country's internal tax system. I'm surprised you are confused in this issue. The post you reply to is straight forward and easy to understand.
I don't see a price disadvantage for US goods against goods made in Europe which is more regulated and higher taxed than the US.
As I'm sure you know, most Europeans have a VAT style sales tax that is removed when their products are exported from Europe to the US, and are added when our products are imported from the US to Europe. Our income tax system effectively accomplishes the opposite. Which is, by common sense, STUPID trade policy, and arguably a loophole around the constitutional prohibition on export tarrifs.
Other countries which are not may have such an advantage but that is part of foreign trade and it always has been.
Regardless, even if foreign trade dynamics eventualy compensate for inequities (which such theories obviously do not apply to our biggest trade competitor, China), there is a net advantage for American industry in the short term, even if it will gradually be adjusted away by currency values. Regardless, for domestic marketshare competition with imports, particularly from China, our current income tax system is a reverse-protectionist policy, protecting imports at American industry's expense. The FairTax would not negate this, but it would put an equitable tax burden onto imports as compared to domestic products.
Aside from the fact that it appears to be a new, large tax on homes, the removal of the existing "hidden" taxes embedded in the price of the home will tend to even it out. Certainly to the point that "a prescription for disaster" is extremly hyperbolic.
I find it odd that you would dismiss the advantage the FairTax would afford American industry in terms of trade, citing undefined foreign trade dynamics, but you would ignore other economic principles, far less controversial than far trade ecomnomics, and react to the potential increase in the tax on a new home as "a prescription for disaster". This seems to me as if you contradict yourself to some degree. I don't mean that as a pesonal attack, just a candid representation of my confusion at your posts, and a request for clarification.
Indeed! But the FORM that taxation takes is HUGELY important in determining whether or not a society is, in fact, free!
IMHO we are NOT, and WILL not ever again, be a free people so long as we have this current communist inspired income tax system.
Sorry but this post is not internally consistent. You state you are not discussing the internal taxation policies of trading partners then describe how you believe VAT are handled wrt imports/exports.
There is no disadvantage to US exports if they are treated in the same fashion as domestically produced goods in another country. We do not have taxes included in our exports price thus Europe eliminates that competitive advantage by adding VAT to its imports and subtracting from its exports. This does not effect our competitiveness since we do not have VAT. However, changing to a sales tax will increase the complications of our foreign trade as you have illustrated with your examples.
Our income tax system does not do the opposite because income taxes are NOT included in exports' prices. The only taxes within prices are RE, payroll etc. which are also included in Europes exports.
The point you make above is true in terms of a corporate income tax. However most all other taxes are taxes on the company's costs (from the company's point of view).
The SS tax and personal income taxes paid by his employees are taxed as a portion of the cost of payroll. The matching payments the company must make for Payroll is a tax added onto that cost.
All of the other costs the company experiences are products and services it purchases from other companies, which obviously have to charge a price equal or greater than all thier costs (including the entire portion of those costs which will be paid to the federal government as taxes), in order to make a profit. Thus the portion of the taxes represented in the COSTS of a company is generally far greater than the corporate tax levied on its profit.
It doesn't take much thought to figure out that a huge price increase in new homes would collapse the construction industry and drastically increase the cost of home owning. Taxes which will be on the order of 100G/house will be financed which means you will pay many times the 100G before the mortgage is paid off. This type of increase will drastically reduce the number of people who can afford homes because of the initial impact and because those priced out of new homes will purchase older ones which will drive demand for them up and prices as well.
In addition, the removal of interest deductibility will also be a drag on real estate sales and prices and reduce the number of people able to afford homes. Should prices collapse too much there could be serious unintended consequences for banks and mortgage companies as the value of mortgages drops.
There are no "hidden" taxes in older homes from the income tax nor is there any chance this tax scheme will pass without great changes in the way it proposes to treat real estate sales. States do not treat real estate sales with sales taxes and there is a very good reason they don't.
I don't consider your statement as a personal attack. Real estate is a special area of economic activity which is not treated in the same fashion under the tax codes as other transactions. The amount of money and the long terms involved make them different and means they cannot be taxed as other transactions for some of the reasons I go into in the first paragraph. Construction is a huge component of out economy and things which affect it have consequences in other sectors thus any proposal which will have major impacts on it must be carefully considered.
The more I think about this the more questions come to mind. If one buys a new home paying the new sales tax how will he get that tax back when he sells? That tax will not be folded into the home's value thus would appear to be unrecoverable. I buy new house for 300G and pay another 100G for tax while you buy old house for 300G and pay no tax. When you sell you do not have to consider recouping the 100G but I must sell my house for 300G plus the 100G or I'm a loser. But the houses have equal value, 300G.
If the prices of houses fall because of the tax change this would mean that many houses are worth less than their mortgages. Once again there are huge consequences which must be considered. If these taxes are not imposed on new construction for businesses then the housing market will be pushed towards building more multi-unit apartment buildings and away from single family homes.
Is this what we want? I don't think so.
These are just things that occur on the spur of the moment with more consideration or with that of finer minds even more will come up. Serious things.
I had the same confusion when I first came across this specific NRST on Free Republic and had the same experience of not being informed of my error in calculating the Fair Tax. I had to read more before I understood that the 23% was a tax inclusive rate rather than a tax exclusive one.
I am in favor a NRST, and if a 30% rate is where it starts, we who are in favor should be very clear that people understand just how steep this is, and even more careful to point out the potential liabilities while also pointing out the advantages.
Every tax scheme has its ups and its downs, and if we implement the Fair Tax, we will undoubtedly find unexpected advantages and disadvantages in practice also.
I feel that it is like when you read a prospectus: it needs to be very careful to point out why you might not want to make the proposed investment.
I am in favor a NRST, and I will accept the Fair Tax implementation as our NRST, but I also want to be realistic about its effects, and I don't think it is going to be perfect. Great, perhaps, and I would truly like to see some of the more pie-in-the-sky hopes come true, such as making American goods more competitive in the world marketplace. But the current system is an embarrassment to a great nation, and I feel that if President Bush can indeed bring about significant tax reform, it would be a great triumph in an administration that already has promise of being a historic one.
it took 2/3 to get it in and they managed- we should be much more motivated to get rid of it
got any clue how many of your biker freinds are also republican?
My own experience here is that it is quite a few
From The Taxable Income Report
Brief mention should be made of the 16th Amendment to the Constitution, since there is a common but erroneous belief that the 16th Amendment expanded Congress’ power to tax incomes. The purpose of the 16th Amendment, according to the Supreme Court in Brushaber v. Union Pacific (240 U.S. 1), and again in Stanton v. Baltic Mining (240 U.S. 103) was to make it clear that the income tax is, and has always been, an indirect “excise” tax, which never required “apportionment” (a cumbersome process required for all “direct” taxes, in which the tax is divided up among the states according to populations). The Secretary of the Treasury agreed with the Court in Treasury Decision 2303.“The provisions of the sixteenth amendment conferred no new power of taxation, but simply prohibited [Congress’ original power to tax incomes] from being taken out of the category of indirect taxation, to which it inherently belonged, and being placed in the category of direct taxation subject to apportionment.” [Treasury Decision 2303]
An in-depth explanation of direct and indirect taxes, and how they must be imposed, is not necessary here. The only relevant point is that Congress’ taxing jurisdiction was not expanded by the 16th Amendment.
“As pointed out in recent decisions, [The Sixteenth Amendment] does not extend the taxing power to new or excepted subjects...” [Peck v. Lowe, 247 U.S. 165 (1918)]
The income tax had been rejected several times by the USSC. Prior to 1916.
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