Posted on 06/10/2005 10:07:47 AM PDT by Sprite518
AND WHAT ABOUT THE FLAT TAX?
Yes, I know. Some of the people that we would love to have supporting the FairTax have weighed in in support of a flat tax instead. So ... here's some flat tax vs. FairTax issues some of you may want to consider.
Oh so if it was one rate instead of two, then today's tax code would look far different? Sorry I am not buying that. 1986 was as close as we came to a flat tax.
But this is already handled by EXISTING state infrastructure. Assuming that the Federal sales tax is done as a "pass-through" by means of the already-existing state infrastructure, then no new infrastructure will be necessary, and the existing IRS infrastructure can shrink drastically.
Even if there "is" added complexity, it is simply handled by a few added fields of computer code in the cash register computers that ALREADY handle the state systems.
The bottom line is that the Fair Tax will be "transparent" to the "end-user" who pays the tax. All he or she will see is just exactly what he sees today on the cash register slip---total sales, sales tax, and final total. No need to fill out forms and calculate even the "flat tax".
Uh the VAT is not the fair tax. The fair tax is the NRST.
LOL!
In the long term, Yes.
You'll note I am refering to the short term.
Politically you are asking House representatives and Senators with elections in the next cycle to risk the potential short term outcry when running for re-election until the public comes to the realization they are actually richer than they were before this change. Politically I see the fair tax as a tougher sell than the Flat Tax which bears some similiarity to the current system. It wouldn't be as much of a shock to the American people in the short term.
You can say the politics shouldn't matter. usually I'd agree with you. In this instance if our politicians actually decided to change the tax code rather than talk about it, I don't want the ones that do to be penalized.
IF the Fair Tax is the way most people want to go, than you'll have a duty to educate 24/7 to prepare people for the shock of the taxes we actaully pay when no longer hidden in complicated tax laws.
"In this instance if our politicians actually decided to change the tax code rather than talk about it, I don't want the ones that do to be penalized."
I agree and your concern makes a great example supporting Thomas Sowell's first chapter in "Applied Economics."
"IF the Fair Tax is the way most people want to go, than you'll have a duty to educate 24/7 to prepare people for the shock of the taxes we actaully pay when no longer hidden in complicated tax laws."
Once again, I agree. I'll also add that I try to educate at least one person a day and I have yet to have anyone stand steadfastly against it after they understand it. Of course, that claim is meant for in person discussions, I do know of many on FR that stand steadfastly against the NRST.
I think he feels (as we all do) that they're too high and too complicated but he doesn't delve into all the intricacies of different tax ideas.
No. Just the names and SSNs to verify citizenship. And of course, the address (or bank acct#) to send the check to.
Or if you don't want to, don't apply for the rebate and just drop off the grid.
Answer the question, then we'll talk:
Quote a reputable source that will validate your contentions!
"It does not seem to be working to well if you live in Taxachusses."
In any other case I would agree with you, but the 2.5% limitation on property tax increases (sans voter override) has worked spectacularly. Naturally, the politicians were and are against it, as they cannot raise property taxes at will. We were only able to vote it in as a referendum (Proposition 2 1/2 that passed in 1980 I believe). I will go to my grave thanking Barbary Anderson of the Citizens for Limited Taxation, which pushed the referendum through to victory.
If you look at nearby CT, you will find that their tax rates are atrocious, as they are in most of the Northeast (and probably elsewhere). For a fifteen minute extra drive, I save about $3000! When I got my first mortgage, the company, based in NJ, thought my yearly payment was actually my quarterly payment because it was low, and we had to redo all the paperwork! Of course, it helps to have a town full of tightfisted voters........ ;-) Town meetings are VERY entertaining.
Time to start paying our bills.
"Government will have to know the names and incomes of anyone applying for this rebate."
Incorrect. The rebate varies by family size, NOT by income level.
"There will never be income tax modification. Our government officials use the tax system in order to drum up votes by pitting the classes of income against each other. Under a flat tax or fair tax they would have to use other means to drum up votes and they don't have anything else to use. So, everyone, forget ever seeing income tax modification. It's just another opportunity for your congressmen and senators to make you think they are working towards your best interest. It's all a bunch of hogwash."
“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
"It is much simpler to implement such a revenue scheme under a sales tax than it is under an income tax."
"It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess. They prescribe their own limit; which cannot be exceeded without defeating the end proposed, that is, an extension of the revenue. When applied to this object, the saying is as just as it is witty, that, 'in political arithmetic, two and two do not always make four.' If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them."
Alexander Hamilton in Federalist #21
My view on taxes has been the same for years. I make a dollar (either from working,welfare,retirement,disability,workers comp,lottery,gift,etc.) I pay Uncle Sam 10 cents. He doesn't get one penny more. He has to budget the government on 10%. The IRS is abolished, forms are abolished, tax loops and lawyers are gone. If the government were wise, they would operate their budget on 9% and save the 1% for a rainy day (or 9/11) event.
"Remember, the passage of the 'fair tax' will not change the nature of Congress, it will simply give them a new toolbox and when I look at the tools inside, I get a good idea of how they can be misused."
Actually, the FairTax will greatly reduce the congress's "toolbox". The area of greatest complexity in the current system is in the area of deductions. That opportunity for mischief is totally absent in the FairTax. Will congress attempt to compromise the simplicity of the FairTax tax base? Undoubtedly, some in congress will. However, with the difference in public perception that the FairTax will create, there will be a much greater recognition of the price that we all pay for the special interest provisions in the old system.
Bottom line is that the FairTax will be much more simple and straightforward than the current system, even if we do a poor job of maintaining "eternal vigilance". If we do a really good job in that area, we can keep the system relatively "pure", which would mean an enormous improvement in that regard.
"They haven't a clue how much they really pay, whereas a Fair Tax would 'feeL' like a tax raise even though it actually is not."
This is one of the fundamental principles of the FairTax and one that supporters believe is a significant benefit - its visibility. For those concerned about the rate, this should provide reassurance that there will be public pressure to lower it.
"Change the label from IRS to whatever but don't insult my intelligence implying that there will not be an enforcement arm to ensure the guberment gets every cent of their due and a bureaucracy to cut the rebate checks. The scope of that effort as evidenced by the state tax agencies and the corresponding corporate tax departments necessary to deal with them is proof enough for me."
What your analysis misses is that the FairTax would represent a 99% simplification (if you accept page numbers as an approximation for the complexity of the systems) combined with about a 90% reduction in the number of points of collection/enforcement. The resouces which will have to be committed to enforcement can be drastically curtailed and still get higher rates of compliance than with the current system.
In addition, individuals won't have to disclose every detail of their financial lives annually.
Those are some very significant differences.
"I guess you do not have a source?"
"A source for reasoned speculation of how Congress would manipulate a sales tax scheme? No, and I don't have a time machine either."
I am so glad you admitted that your scary scenario is "speculation". What about precedent? I believe that there are about 45 states which currently have a sales tax and none have been added within the past 15 or so years, if memory serves. So how many of the state sales taxes have morphed into the kind of monstrosity that you have forecast for a national sales tax?
"I have yet to have anyone stand steadfastly against it after they understand it. Of course, that claim is meant for in person discussions, I do know of many on FR that stand steadfastly against the NRST."
My experience is similar to yours. Of the naysayers on FR, not a one of them will debate in public, which is very interesting to me. You cannot find anyone who will even attempt to defend the current horrid system, except on FR.
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