Top 11 Secrets of a National Retail Sales Tax

Various | 6-10-05 | Always Right

[FreedomCalls]

Why would the doctor remit anything? Salaries are not taxed under the NRST. Taxes would only be paid when purchasing retail products and services.

The doctor's services to his patients are a taxable service. He is the collector for that tax. He must collect the NRST on whatever he charges his patients. The patients are in effect "purchasing" a retail health service from the doctor.

[lewislynn]

only a stupid idiot would sell a house for less than he paid.

Why would you sell the house for less than $260,000?

I thought you said there would be 20 to 30% price reductions? A $200,000 home purchased today would be worth only $140,000 in your world. How much are YOU willing to sacrifice for lower prices? It looks to me like YOU might be that stupid idiot...be careful what you wish for.

[SALChamps03]

Yes, but business owners assign themselves a salary. That is completely separate from the bills on which his patients would pay tax.

[ancient_geezer]

"Required"? I thought you said it was voluntary. Which is it?

The Social Security Administration already has that information which is necessary for them to fulfill your request for the sales tax rebate. You do realize government has an affirmative duty to perform on your application.

You have the option of making out the application for the rebate or not, that's your choice.

Thus voluntary to you, mandatory on the behalf of government upon your demand.

[lewislynn]

Yes, but business owners assign themselves a salary. That is completely separate from the bills on which his patients would pay tax.

LOL! Where does the business owners salary come from?

[Always Right]

Whose is going to go up zero? Nobody that I can think of. SS income is taxed and that tax goes away.

Shoot about half of the people in this country pay little to no income tax. Income tax is only for people with a significant amount of income, so most people on SS don't pay one red cent to the federal government.

[Always Right]

Why would the doctor remit anything? Salaries are not taxed under the NRST. Taxes would only be paid when purchasing retail products and services.

Medical services are taxable, so every penny a hospital or independant doctor receives they must remit sales tax.

[tomakaze]

re:That is an even bigger loser. Slavery is not the condition of Americans even if they pay income taxes. Pure silliness
 
Well it's obvious we aint gonna agree on that. While i acknowledge that there's no way in hell anythings gonna change, mostly due to fedgov getting away with it for so long, The words do mean what they say, unless read by someone who subscribes to the "living breathing document" view of the constitution (like say, a supreme court justice or any graduate of harvard).
so you're right it is a pretty pointless arguement.
 
that said, what's wrong with apportionment? feds set a yearly budget, and in addition to what the feds collect in tarrifs and excise taxes, the states pony their share based on % population. the state collect this by whatever means the states constitutions allow (myself, i favor a poll tax and nothing else)

[Always Right]

From the Sale Tax Bill:


`SEC. 703. GOVERNMENT PURCHASES.

`(a) Government Purchases-

`(1) PURCHASES BY THE FEDERAL GOVERNMENT- Purchases by the Federal Government of taxable property and services shall be subject to the tax imposed by section 101.

`(2) PURCHASE BY STATE GOVERNMENTS AND THEIR POLITICAL SUBDIVISIONS- Purchases by State governments and their political subdivisions of taxable property and services shall be subject to the tax imposed by section 101.

.....
The government is viewed as the end consumer, so items they pay for including services (employees) are subject to sales tax.

[Smokin' Joe]

So the customer is paying $100 for a $70 item? What's the difference?

30 dollars of tax on a 70 dollar item is 42%, not 37%

[Gaffer]

A legal sale under the income tax does not capture any federal sales tax, but captures income tax embedded in the car.

Whether it's captured in "income taxes" through the middle-men now under the present system or captured in an NRST scenario later, it doesn't make a difference in the end to the government. What it does, however, equalize is the misproportioned taxe rates, breaks, social credit system that the tax code has now. Based on your argument above, which is very confusing, I don't see the bad side.

[Always Right]

What to the it does, however, equalize is the misproportioned taxe rates, breaks, social credit system that the tax code has now.

A simplified code is nice, but we have 535 congresscritters, 100 Senators, and a gang of lobbiests who will fight everyday to muck it all up. Reagan cleaned up the income tax code quite a bit, but it did not last. The current bill already as some exemptions for education, next will be prescription drugs, then certain food....

[pointsal]

For goodness sakes, I cannot think of a bigger waste of time and resources than the time and money I spend preparing my books for compliance with IRS requirements! Throw the existing system out!

[Gaffer]

My beef is really with the social credits, namely the "Earned-Income-Tax-Credit." It is an insidious measure that takes a tax base who not only already doesn't pay (little or none) income taxes, and then "makes believe" that they really paid more taxes on a larger income, hence "earned income" credit, and then GIVES it back to them. There is even a provision for these "taxpayers" to calculate what their EITC payment would be at the end of the year and the government FORCES the employer to pay this out over the year in equal payments. The government does not however give the employer any interest for the us of his money throughout the year.

Early this year I was with a friend in rural Alabama at a general store (feed, seed, and other nik naks) and while we were there at least 10 low income people came in with those IRS checks, averaging about $3-4K a pop. The owner cashed them after taking his cut. All I could think of was that I didn't get a chance to donate MY tax money (definitely a portion of that doled out) to the charity of my choice; the government decided that for me.

EITC fosters single-parenthood and encourages (if it can be said that) idleness. It is one of the worst programs that was ever instituted, coincidentally by a Republican President.

[pointsal]

This post must be from the Accountant's Income Defense (AID).

Change the tax system. It's broke.

[ancient_geezer]

The government is viewed as the end consumer, so items they pay for including services (employees) are subject to sales tax.

Yep.

We tax government today under the federal income/payroll tax system, and would under the Flat Tax.

To not do so under the NRST, would provide a very large windfall to government on which it would use to increase its spending and size relative to the private sector. A condition that government has shown it is more than able, willing and infact determined to do.

 

Relative Shares of Economy
pre-1930	post WWII (1947)	TODAY (2004)

 

A fairly comprehensive discussion of the issues involved in the NRST levy on government consumption (as an issue raised by the JCT) can be found in this PDF:

Impact On State And Local Governments And Tax-Exempt Organizations Of Replacing The Federal Income Tax, JSC-4-96, April 30, 1996 pages  57 thru 61(pdf pages 61-65)

 

To get rid of the NRST provisions taxing government, then reduce the current tax revenues by repealing taxes on government wages, and the governments budget by the same amount. Your issue will be solved, other problems would crop up in place of it, but that problem will be gone.

[GGpaX4DumpedTea]

"Then what option do we have? The current tax system is outrageous, what's the better path to follow?"

Number 1 option - REDUCE SPENDING! Reduce spending at both Federal and State and Local level.

Number 2 - VAT is a bad thing. I saw it first hand during the 3 years I lived in the UK (Northern Ireland). VAT/National Sales Tax are similar, though they operate a bit differently. And all countries with VAT also have HIGH income tax rates. Stuff in England costs about double (US dollar equivalent) what it does here in the US.

Number 3 - My opinion is that some sort of a Flat Income Taxmight be the best alternative to the present system. Any legislation instituting a flat tax must also require major reorganization/reduction/curtailment-of-power in the IRS.

Number 4 - the only argument for National Sales Tax is that it would tend to put US manufacturing on a more equal footing with imports because it would require the same tax rate on incoming goods. Perhaps someone has a suggestion on how to accomplish this without the adverse effects on the rest of us. Note that EC countries avoid VAT on exports. But we can't tax those imports with duties to match the VAT avoided. This in effect is an EC subsidy on exports, but we can't do the same on our exports. Inequitable!

[GGpaX4DumpedTea]

"(myself, i favor a poll tax and nothing else)"

Interesting. Only those paying the poll tax vote? How determined - % of income? % of spending? fixed rate? Other?

This certainly would 'franchise' those of us who support the cost of government with our money. Makes it a lot easier to elect those who would do the will of the electorate.

[Doctor Stochastic]

You left out the ease with which the National Retail Sales Tax can be used for Social Engineering. The first Texas sales tax did exactly that; sugar purchased for baking cookies was not taxed (food), but sugar purchased for making candy was (industrial.) As the current proposal reads, buying a riding lawnmower to mow your own lawn is subject to tax; buying the same lawnmower to mow other peoples lawn isn't a final use; and thus not taxed. (Similarly for bags of fertilizer.)

Things that deemed harmful (taxed, alcohol, firearms) or socially useless (television, movies, chewing gum, hamburgers, soft drinks) can easily be taxed differentially. Similarly for professions. Socially harmful services (rich man, poor man, beggar man, thief) can be taxed higher than socially useful ones (doctor, lawyer, indian chief.)

[ancient_geezer]

Number 1 option - REDUCE SPENDING! Reduce spending at both Federal and State and Local level.

Hasn't happened under the last 100 years with the income tax inplace with half the voting public on the dole paying no tax at all. What makes you figure it will suddenly happen now, with no change in the tax system.

So many Americans paying little or no federal taxes makes for a natural spending constituency. It's like me in the restaurant: What do I care about extravagance if you're footing the bill?
---Walter Williams

Number 2 - VAT is a bad thing. I saw it first hand during the 3 years I lived in the UK (Northern Ireland). VAT/National Sales Tax are similar, though they operate a bit differently. And all countries with VAT also have HIGH income tax rates. Stuff in England costs about double (US dollar equivalent) what it does here in the US.

No argument there, hide the mechnics of major parts of a nation's tax system behind the corporate veil, just hides the economic burden government places on the citizen, it certainly doesn't remove it.

Number 3 - My opinion is that some sort of a Flat Income Taxmight be the best alternative to the present system. Any legislation instituting a flat tax must also require major reorganization/reduction/curtailment-of-power in the IRS.

Any form of income tax, by its very nature, requires a large IRS to administer it, that is not going away under a Flat Tax.

Any tax system that relies on the individual or citizen to assess and report his own tax, will have a large bureaucracy to make sure the assessment, no matter what the size of the form it is reported on, is accurate, truthful, and complete. In fact the less information in a tax return the more powerful an IRS will become to force compliance.

 

Number 4 - the only argument for National Sales Tax is that it would tend to put US manufacturing on a more equal footing with imports because it would require the same tax rate on incoming goods. Perhaps someone has a suggestion on how to accomplish this without the adverse effects on the rest of us. Note that EC countries avoid VAT on exports. But we can't tax those imports with duties to match the VAT avoided. This in effect is an EC subsidy on exports, but we can't do the same on our exports. Inequitable!

There are actually many more arguments for a National Retail Sales Tax than this, one very big one is to get the IRS out of the private lives and financial privacy of the citizen's home. A second is the very large costs imposed upon manufacturing and business in general by the income/payroll tax system that impede the economy and reduce the living standards of everyone, what ever the format of its forms or number of tax bracket in it.