Posted on 08/03/2005 4:51:43 PM PDT by RobFromGa
A simple question...
So, under the FairTaxI get to keep my whole paycheck, prices for everything I will buy will stay the same even with the taxes included, and I get a prebate check from the govt every month. And businesses pay no taxes.
Where is the extra money coming from...
What is wrong with this reasoning below?
1. Right now the government collects $X in the form of all taxes.
2. All taxes are really paid for by consumers in the end result, either directly, or in the cost of their purchases which allow businesses to collect money in order to pay taxes. Companies do not really pay taxes they jsut collect them and pass them on.
3. The FairTax will collect the same $X per year in the form of taxes but using a different method.
4. Under the FairTax, the price paid for goods will not rise because getting rid of all the taxes built into goods will cause the prices to drop, then the FairTax will add onto the new lower price, resulting in the same price paid by consumers.
5. So, for a given taxpayer, shopping (consumption) will be revenue neutral. Ie. Prices are the same as before.
6. And each given taxpayer will get a "prebate" check every month that they are not getting now.
7. And each taxpayer will pay no taxes on capital gains, or on savings.
8. And, each taxpayer will no longer pay any taxes on income, or payroll taxes.
9. And, there will be no Fair Taxes on any purchases made for a business.
Are these all true so far?
Again, I get to keep my whole paycheck, prices for everything I will buy will stay the same even with the taxes included, and I get a prebate check from the govt every month.
Where is the extra money coming from???
Legitimate business expenses would not be subject to the tax. I think that's what you want to know. Whether or not someone is cheating and getting away with it is another matter. Cheating is cheating.
It qlmost sounds as though you haven't been reading the posts that have been made to you explaining the tax exemption mechanism.
Your assumptions are making it far more comples, frequent, and convoluted than it most likely will be. See #436 for a start. There will be very few retailers who will refuse to accept an exemption certificate and for the few cases that do occur there are provisions in the bill to allow you to recover the funds (or the seller). Those cases will certainly be the exception and infrequent.
Also, there is no retail gestapo and it is not they who decide or not to accept your exemption certificate but the seller and it is the seller who would be audited - if anyone. You seem to be trying to scare yourself for some reason. There will not be any sort of wholesale filling out of sales tax refund forms by anyone in your position - that is what you have in a VAT tax system such as in the Euro countries. The FairTax is careful to NOT be a VAT which is why your repeated concerns on the matter seemmisplaced.
If you'd take advantage of the links that have been given you, you could learn a lot instead of merely guessing and assuming.
Hey, dumbass, add up the numbers. There's less than 7% of embedded taxes in the retail price of all products sold in the US.
I would really like to see exactly HOW they calculated those rates.
Without a serious cut in overall spending, all we end up with is a higher tax rate than ever. Pushing this tax without seeking out the downside is a formula for another disaster, one that we will end up having to pay for a very long time.
Nothing involving government is without a downside. Portraying this tax as having no downside is very dishonest, to say the least.
I'm sure they really don't want the feds to know where they live. But hey, they're US citizens. Let them get the rebate, I don't care. Lock them up and throw away the key for the drugs, though. According to the bill, prisoners don't get the rebate. LOL
life, death, residence.
I've been through multiple sales tax audits and numerous IRS audits in my business. The difference is, the sales tax auditor did not have to find anything. Most of the time our audits were "no change". The IRS auditor HAD to find something.
If you keep all this in your s-corp you would never pay any federal tax. And your children and grandchildren wouldn't have to worry about estate taxes. When you sell a property you don't have to worry about section 1031 tax free exchanges, because there is no tax due. That is true whether you are an s-corp or an individual. You don't need a depreciation deduction because there is nothing to deduct it from . You can pay yourself a salary out of the S-corp for you actual living expenses.
You just have to give up the old way of thinking. This is a new paradigm for the real estate industry. Can you give me an example without the state taxes involved, since that is irrelevant to our discussion?
How do they catch tax cheats now? Different agency, same problem. The IRS could come in right now and deny every one of your travel expenses.
I would really like to see exactly HOW they calculated those rates.I'm sure they didn't count the tax the government would be paying itself. In other words, kept real government spending level.
Is that the one I asked you to translate into plain english but you never did?
Doesn't the cost of labor go down because productivity goes up, since people aren't working as slaves anymore?
It is up to the employer whether or not he wants to give the employer FICA contribution to the employee or not. Unlike under the current system where he has no choice.
It's that kind of comment that doesn't help your credibility, YN.
Sorry, most of the time these threads don't grow this fast.
Sorry, most of the time these threads don't grow this fast.
So wouldn't these cost just be replaced in the budget with the Fair Tax?
The fair tax bill repeals every section of the code dealing with income taxes, estate taxes, corporate taxes and payroll taxes and eliminates the IRS. The repeal of the 16th can only come AFTER we have replaced the income tax with something else. The govt. can't function without revenue while the state legislators dick around for 3-4 years ratifying the amendment.
Is that the one I asked you to translate into plain english but you never did?That's a pretty big request. Pardon me for not complying.
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