A Fair Question about Fair Tax

August 3, 2005 | RobFromGa

[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???

[JOHN W K]

You should be able to determine that is is not POSSIBLE to repeal the 16th amendment without first having in place a tax revenue measure. You can bet your bottom dollar that all of the CongressCats know that. To do otherwise would be total insanity and chaos as there would be no legal way to fund the government.

ANSWER

Telling more fibs?

If such an amendment is adopted, repealing the 16th Amendment, it would bring us back to our Founding Father's original tax plan, a plan which was carefully designed to provide more than sufficient power to raise a federal revenue from external taxation, and, an inland excise which would include taxing articles of consumption, not to mention the direct apportioned tax among the states if a federal deficit should occur

The only problem with Congress is, returning to our founding father's orginal tax plan would encourage members of Congress to follow sound fiscal policies, including the closing down of unnecessary and unconstitutional government offices. And so, Congress, and the friends of big government, prefer to have the so called fair tax at its disposal which is intentionally designed, by its revenue neutral feature, to support big government and all the existing political plum jobs on Capitol Hill, many of which have six figure salaries!

Your funny!

[DakotaRed]

"Sure has. I know of many legislators and city council members that have lost their cushy jobs over trying to raise retail taxes in spite of the fact that food, medicines and services in general are not subject to such taxes and thus don't affect every voter the same way."

Sorry, but a few voted out of office, especially at lower levels of government, doesn't change what has been happening. Like I said in an earlier post, we are still paying a Telephone Tax that was instituted in 1898 to finance the Spanish American War. Efforts to repeal it have so far been defeated or vetoed. Taxes have been steadily increasing for decades and too many of those responsible are returned to their offices each and every voting period.

It's time to educate the public, not about a way to simply feed government another way, but to educate them that the spending from Washington is out of control and who is responsible for it, regardless of party affiliation.

As far as I'm concerned, the only fair tax is one not charged to pay for frivolous spending. That's why I keep saying that no tax reform will work until spending is brought under control, something the Fair Tax initiative doesn't even approach, other than by wishful thinking. From the endorsement letter of the economists supporting the Fair Tax, we read;

We are not calling for elimination of federal taxation, which would be irresponsible and undesirable. Nor does our endorsement call for reduced federal spending. The tax reform plan we endorse is revenue neutral, collecting as much federal tax revenue as the current income tax code, including payroll withholding taxes. http://fairtax.org/pdfs/Open_Letter_President.pdf

To simply continue feeding a beast with an insatiable appetite is a formula for disaster.

[DakotaRed]

For those of you who are not aware of John, he runs some truly virulent, reactive (and grossly wrong) anti-FairTax articles and websites on the Internet.

Someone disagrees with this tax proposal and that makes them bad? Is this discussion going on at DU?

[DakotaRed]

I've been at this for a while now my friend and seen all that stuff before. Many times in fact and it is as worthless now as it was the first 20 time I looked at it.

And you still can't see the obvious pitfalls of this proposal? Is everything you disagree with "worthless?" Isn't refusing to consider many downsides and pitfalls what got us into this tax mess in the first place?

I guess this means the "naysayers" from long ago that argued against the current system of taxation are receivng their vindication now? And to consider, their views way back then were "Worthless" also.

[groanup]

Well that gets the prize for the longest, most uneducated post in history. I even clicked on one of your links and found it to be absolutely ignorant. You have to be given an award.

[DakotaRed]

And I have asked to see your specific proposals but, to date, all I have seen is efforts at destroying what others ARE doing.

And I keep saying that nothing will bring true relief until we can regain control of spending out of Washington.

How are we "destroying what others ARE doing" by raising legitimate questions and receiving mostly ridicule and scorn for not going with the flow?

For something so simple, I wonder why the bill alone is some 133 pages (on pdf) long and has sections dedicated to definitions, record keeping, enforcement, penalties and such? I also wonder why the writers of this current proposal resorted to smoke and mirrors by claiming the national sales tax is 23% on the dollar, but will actually cost 30 cents on the dollar? If it's so good, why the slight of hand?

What will happen once this new tax structure is in place, on only new items, mind you and buyers see the used car and housing market much more attractive than the new market? Even if businesses brought prices down, as is hoped for, existing item won't be charged 30 cents on the dollar making them much more attractive to purchasers and could eventually bring about high scale unemployment due to less and less new high dollar items not being sold. Could Congress, to spur economic growth again, start exempting certain new items? Couldn't that be the start of returning right back to where we are today?

I don't know about you, but a one year old car for $35,000 is a lot more attractive than a brand new car costing $38,000 with $11,000 dollars National Sales Tax added onto it. Same with a house.

[pigdog]

You also incorrectly wrote in #625 "... what Boortz and Linder claim their plan will do ..." which indeed is different than the "promoted by" quote. If you meant something else perhaps you could clarify it.

HR25 does eliminate the income tax etc. and is the only practical way to be able to repeal the 16th amendment. You'll find FairTax supporters almost all agree with you on this. The diffenence lies in how it can be done.

Certainly Congress is not going to repeal the income tax simultaneously with depending on it for income as a tax method. That makes no sense at all. The call for repealing the 16th first is something long promoted by those wishing to retain the present system or something very like it. As such, it is a call to basically do nothing since Congress will not cut off their nose to spite their face. It is for this reason that you are actually defending the status quo whether you are aware of it or not. Dick Armey used to use the same technique in his debates trying to promote an income-based flat tax.

Despite your claim, the FairTax leaves no "door wide open" for re-instituting the income tax while repeal is taking place. Repeal and ratification are a slow process and the nation must have a functioning tax system in operation during this time. The FairTax does this by eliminating the income tax (etc.) and the IRS and requires destuction of the income tax records. I see no door at all - nor is there. Repeal/ratification can then proceed as rapidly as it can and should.

Nor did I say that theose now collecting tax revenues under the income/payroll tax system were collecting consumption taxes - merely taxes and they do it under the thumb of the feds and with no recompense. And I certainly was not talking about the compliance costs of completing your own tax return but merely acting as an uncompensated tax collector for the federal government. Are you trying to deny that this takes place now?

Certainly I have no quarrel with your 16th wording - sounds fine to me. I just realize (as you do not seem to) that you can't get there from here without having a functioning tax system that does not depend upon what is being eliminated. That much is clear. Eliminating the income tax and destroying its records are hardly "creative fibs" but are the wording of the bill itself. There is no "open door", but I'd support your efforts to further the 16th repeal. In fact you should a letter to John Linder proposing the wording you specify here. The bill calls for repeal but does not, itself, specify any wording (nor should it since it is not a constitutional amendment bill, but a tax bill).

[ancient_geezer]

To simply continue feeding a beast with an insatiable appetite is a formula for disaster.

And your formula to correct the current state of affairs under an income tax system which ensures that over half the electorate do not perceive participating in the cost of government, much less consciously paying a tax due?

Sorry,

A government which robs Peter to pay Paul can always depend on the support of Paul.
-George Bernard Shaw

"It's like me in the restaurant: What do I care about extravagance if you're footing the bill?"
Walter Williams

Buying votes from one segment of society at the detriment of another is not a proper function of government, state or federal, causes all kinds of distortions and unfair treatement across the board.

90+ years of the income tax system constantly levying ever heavier burdens on the productive half of the American economy supporting ever growing federal government cannot even pretend to place government excess under control.

The Honorable James DeMint (R-SC)
United States House of Representatives
APRIL 5, 2001

• "There has been a shift in the relationship between individuals and government, he argues, such that fewer and fewer are paying taxes at the same time that more and more are receiving increasingly generous benefits. If it becomes the case that most voters do not bear a financial burden for this largess, then there will be little to restrain--and significant political incentives to encourage--the continued growth of government.

Hate to tell you but we are there, and no turning around until the electorate themselves perceive and act on the burdens there demands for largess has created.

Get the tax collection mechanism separated from the individual citizen, but assure they all perceive the burden that largess and excess government imposes in their daily lives. Only then can the electorate be said to have the oppertunity to knowingly, intelligently and responsibly exercise their francise to vote and exercise that vigilence necessary to the limiting of federal excess.

The siren call for representation without taxation under the federal income tax system is the formula that got us where we are at today. The ability to hide or disguise taxation from the view of large sectors of the electorate allows the Congress to get away with the creation of the evergrowing monster that it fosters.

Liberty and freedom have a price, responsibility. If the perception of burden laid by government is interfered with or avoided there are no brakes on the growth of government, the ultimate result is the end of freedom through creeping socialism.

We are all paying through the nose, rich and poor while politicians play the tune of envy and resentment that Americans continue to respond to not understanding the full picture what is happening to them. The NRST is a means to open VOTERS eyes to the reality.

The Intent of the individual income tax is for political and social control not revenue collection. The Individual Income tax is maintained to establish and hold every person in the country perpetual legal jeopardy. That is a situation that must end with the repeal of the income tax from the statutes, and the prohibition of its use by Constitutional amendment that future generations will not face the same manner of manipulation and interference in their lives.

If we expect to see control of government spending, we had best look to make the burden visible to the whole of the electorate, not just the few designated as the token guy behind the tree.

That my friend is one of the bottomline purposes of going to the NRST, make the cost of largess perceptible to the entire electorate, even the lowest most rungs of the economic ladder.

You want government spending under control, then correct basis from which the socialist redistribution receives its primary support, the apparent free lunch on which it derives its political power from the majority of the elecorate. Until we engage the entire electorate in the cost of government we will continue down the current path we are headed.

Change the dynamic, the pardigm on which the country operates, bring the cost of government home to all who benefit from the benefits of citizenship in this nation, not just the minority at the top of the economic pile on which the greatest tax burden is currently placed. Until you give reason to the welfare mother at the bottom of the heap to complain about the rate of taxation of her bennies I can guarantee the socialist progression will continue with ever growing federal spending as the fuel that perpetuates the whole scheme.

Place the control of ones earnings, and control over the payment of taxes, in the hands of the American people through their choices in how the utilize their resourses, as was intended by the founders, we will see the necessary changes take place.

 

Federalist #12:

• "A nation cannot long exist without revenues. Destitute of this essential support, it must resign its independence, and sink into the degraded condition of a province. This is an extremity to which no government will of choice accede. Revenue, therefore, must be had at all events. In this country, if the principal part be not drawn from commerce, it must fall with oppressive weight upon land."

• "The ability of a country to pay taxes must always be proportioned, in a great degree, to the quantity of money in circulation, and to the celerity with which it circulates. Commerce, contributing to both these objects, must of necessity render the payment of taxes easier, and facilitate the requisite supplies to the treasury."

 

Federalist #21:

• The principle of regulating the contributions of the States to the common treasury by QUOTAS is another fundamental error in the Confederation. Its repugnancy to an adequate supply of the national exigencies has been already pointed out, and has sufficiently appeared from the trial which has been made of it. I speak of it now solely with a view to equality among the States. Those who have been accustomed to contemplate the circumstances which produce and constitute national wealth, must be satisfied that there is no common standard or barometer by which the degrees of it can be ascertained. Neither the value of lands, nor the numbers of the people, which have been successively proposed as the rule of State contributions, has any pretension to being a just representative.

• 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. ... Impositions of this kind usually fall under the denomination of indirect taxes, and must for a long time constitute the chief part of the revenue raised in this country.

  Those of the direct kind, which principally relate to land and buildings, may admit of a rule of apportionment. Either the value of land, or the number of the people, may serve as a standard. The state of agriculture and the populousness of a country have been considered as nearly connected with each other. And, as a rule, for the purpose intended, numbers, in the view of simplicity and certainty, are entitled to a preference.

 

Continue the current system of finacing government hiding the burdens of largess from the perceptions of the majority of the electorate. the ultimate result is totally predictable:

 

As attributed to University of Edinburgh University History professor and Scottish jurist Sir Alex Fraser Tytler (1742-1813). by John Bagot Glubb :

"A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largess from the public treasury. From that time on the majority always votes for the candidates promising the most benefits from the public treasury, with the results that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.

[DakotaRed]

"pass the FairTax, help out on the 16th repeal effort ... and then as a follow on help us get Congress to drastically cut spending"

Isn't this putting the cart in front of the horse?

Sorry, but this bill does not automatically repeal the 16th Admendment. It calls for it to be repealed, but that takes a 2/3 majority vote in the House and Senate and then must be sent to the states for ratification. If this bill means any states will not be receiving as much Federal Money as they wish, can you honestly say they will ratify it? If it doesn't get ratified, we then could end up paying both

Drastically reduce spending now, do that first, and there's a good chance most all taxes, including this alleged "fair tax" may not even be needed.

I suggest all read the actual bill for themselves instead of a supporters book and see for yourselves what is and is not proposed. It may dull and dry reading, but at least you will see for yourselves how dangerous this really is.

While I want lower taxes as well, blindly jumping into this because some call it "FAIR" just may one day become an millstone around our necks.

As far as I'm concerned, spending must be drastically reduced first, not hopefully as the last thing.

[DakotaRed]

"When the buyer (using illegal money) buys today they would pay the tax costs embedded in the price"

Isn't this provided what they purchase is new? Haven't you all been saying all along that this National Sales Tax is not on existing items and only applies to brand new items?

[JOHN W K]

What a provocative rebuttal.

[ancient_geezer]

As far as I'm concerned, spending must be drastically reduced first, not hopefully as the last thing.

Hasn't happened under the progressive income tax system that assures over half the electorate does not participate in paying the government bill has it. You figure that is going to change sometime soon keeping a tax system that promotes and fosters socialist redistribution with the majority of the electorate out of the loop?

If you do I've got some ocean front property in southwestern Colorado to sell you cheap.

Per-Capita REVENUES

100years of history under the income tax makes it clear that we will not get there (smaller government) from here (the income tax).

[ancient_geezer]

I suggest all read the actual bill for themselves instead of a supporters book and see for yourselves what is and is not proposed.

Indeed everyone should and here is the URL to the bill, as it resides on the Thomas Congressional website.

 

H.R.25

Fair Tax Act of 2005 (Introduced in House)
http://thomas.loc.gov/cgi-bin/query/z?c109:H.R.25:

---

HR 25 IH

109th CONGRESS

1st Session

H. R. 25

To promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national sales tax to be administered primarily by the States.

IN THE HOUSE OF REPRESENTATIVES

January 4, 2005

Mr. LINDER (for himself, Mr. DELAY, Mr. BRADY of Texas, Mr. CULBERSON, Mr. DEAL of Georgia, Mr. FLAKE, Mr. GUTKNECHT, Mr. KING of Iowa, Mr. KINGSTON, Mr. WESTMORELAND, and Mr. PRICE of Georgia) introduced the following bill; which was referred to the Committee on Ways and Means

 

---

A BILL

To promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national sales tax to be administered primarily by the States.

• Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

TITLE I--REPEAL OF THE INCOME TAX, PAYROLL TAXES, AND ESTATE AND GIFT TAXES

• SEC. 101. INCOME TAXES REPEALED.

• SEC. 102. PAYROLL TAXES REPEALED.

• SEC. 103. ESTATE AND GIFT TAXES REPEALED.

• SEC. 104. CONFORMING AMENDMENTS; EFFECTIVE DATE.

TITLE II--SALES TAX ENACTED

• SEC. 201. SALES TAX.

`Subtitle A--Sales Tax
`Chapter 1. Interpretation; Definitions; Imposition of Tax; etc
`Chapter 2. Credits; Refunds
`Chapter 3. Family Consumption Allowance
`Chapter 4. State and Federal Cooperative Tax Administration
`Chapter 5. Other Administrative Provisions
`Chapter 6. Collection; Appeals; Taxpayer Rights
`Chapter 7. Special Rules
`Chapter 8. Financial Intermediation Services
`Chapter 9. Additional Matters

• `SEC. 1. PRINCIPLES OF INTERPRETATION.

• `SEC. 2. DEFINITIONS.

---

`CHAPTER 1--INTERPRETATION; DEFINITIONS; IMPOSITION OF TAX; ETC.

• `SEC. 101. IMPOSITION OF SALES TAX.

• `SEC. 102. INTERMEDIATE AND EXPORT SALES.

• `SEC. 103. RULES RELATING TO COLLECTION AND REMITTANCE OF TAX.

`CHAPTER 2--CREDITS; REFUNDS

• `SEC. 201. CREDITS AND REFUNDS.

• `SEC. 202. BUSINESS USE CONVERSION CREDIT.

• `SEC. 203. INTERMEDIATE AND EXPORT SALES CREDIT.

• `SEC. 204. ADMINISTRATION CREDIT.

• `SEC. 205. BAD DEBT CREDIT.

• `SEC. 206. INSURANCE PROCEEDS CREDIT.

• `SEC. 207. REFUNDS.

`CHAPTER 3--FAMILY CONSUMPTION ALLOWANCE

• `SEC. 301. FAMILY CONSUMPTION ALLOWANCE.

• `SEC. 302. QUALIFIED FAMILY.

• `SEC. 303. MONTHLY POVERTY LEVEL.

• `SEC. 304. REBATE MECHANISM.

• `SEC. 305. CHANGE IN FAMILY CIRCUMSTANCES.

`CHAPTER 4--FEDERAL AND STATE COOPERATIVE TAX ADMINISTRATION

• `SEC. 401 AUTHORITY FOR STATES TO COLLECT TAX.

• `SEC. 402. FEDERAL ADMINISTRATIVE SUPPORT FOR STATES.

• `SEC. 403. FEDERAL-STATE TAX CONFERENCES.

• `SEC. 404. FEDERAL ADMINISTRATION IN CERTAIN STATES.

• `SEC. 405. INTERSTATE ALLOCATION AND DESTINATION DETERMINATION.

• `SEC. 406. GENERAL ADMINISTRATIVE MATTERS.

• `SEC. 407. JURISDICTION.

`CHAPTER 5--OTHER ADMINISTRATIVE PROVISIONS

• `SEC. 501. MONTHLY REPORTS AND PAYMENTS.

• `SEC. 502. REGISTRATION.

• `SEC. 503. ACCOUNTING.

• `SEC. 504. REGISTRATION CERTIFICATES.

• `SEC. 505. PENALTIES.

• `SEC. 506. BURDEN OF PERSUASION AND BURDEN OF PRODUCTION.

• `SEC. 507. ATTORNEYS' AND ACCOUNTANCY FEES.

• `SEC. 508. SUMMONS, EXAMINATIONS, AUDITS, ETC.

• `SEC. 509. RECORDS.

• `SEC. 510. TAX TO BE SEPARATELY STATED AND CHARGED.

• `SEC. 511. COORDINATION WITH TITLE 11.

• `SEC. 512. APPLICABLE INTEREST RATE.

`CHAPTER 6--COLLECTIONS; APPEALS; TAXPAYER RIGHTS

• `SEC. 601. COLLECTIONS.

• `SEC. 602. POWER TO LEVY, ETC.

• `SEC. 603. PROBLEM RESOLUTION OFFICES.

• `SEC. 604 APPEALS.

• `SEC. 605. TAXPAYER RIGHTS.

• `SEC. 606. INSTALLMENT AGREEMENTS; COMPROMISES.

`CHAPTER 7--SPECIAL RULES

• `SEC. 701. HOBBY ACTIVITIES.

• `SEC. 702. GAMING ACTIVITIES.

• `SEC. 703. GOVERNMENT PURCHASES.

• `SEC. 704. GOVERNMENT ENTERPRISES.

• `SEC. 705. MIXED USE PROPERTY.

• `SEC. 706. NOT-FOR-PROFIT ORGANIZATIONS.

`CHAPTER 8--FINANCIAL INTERMEDIATION SERVICES

• `SEC. 801. DETERMINATION OF FINANCIAL INTERMEDIATION SERVICES AMOUNT.

• `SEC. 802. BAD DEBTS.

• `SEC. 803. TIMING OF TAX ON FINANCIAL INTERMEDIATION SERVICES.

• `SEC. 804. FINANCING LEASES.

• `SEC. 805. BASIC INTEREST RATE.

• `SEC. 806. FOREIGN FINANCIAL INTERMEDIATION SERVICES.

`CHAPTER 9--ADDITIONAL MATTERS

• `SEC. 901. ADDITIONAL MATTERS.

• `SEC. 902. TRANSITION MATTERS.

• `SEC. 903. WAGES TO BE REPORTED TO SOCIAL SECURITY ADMINISTRATION.

• `SEC. 904. TRUST FUND REVENUE.

• `SEC. 905. WITHHOLDING OF TAX ON NONRESIDENT ALIENS AND FOREIGN CORPORATIONS.

• SEC. 202. CONFORMING AND TECHNICAL AMENDMENTS.

• `SEC. 6161. EXTENSION OF TIME FOR PAYING TAX.

• `SEC. 6601. INTEREST ON OVERPAYMENTS AND UNDERPAYMENT.

• `SEC. 7451. FEE FOR FILING PETITION.

TITLE III--OTHER MATTERS

• SEC. 301. PHASE-OUT OF ADMINISTRATION OF REPEALED FEDERAL TAXES.

• SEC. 302. ADMINISTRATION OF OTHER FEDERAL TAXES.

• SEC. 303. SALES TAX INCLUSIVE SOCIAL SECURITY BENEFITS INDEXATION.

 

. It may dull and dry reading, but at least you will see for yourselves how dangerous this really is.

Or not as the case may be.

[DakotaRed]

"Under the FairTax, the tax revenue from this sale would be $23."

"Fairtax Volunteer FAQ #47

I know the FairTax rate is 23 percent when compared to current income taxes. What will the rate of the sales tax be at the retail counter?

30 percent. This issue is often confusing, so we explain more here.

When income tax rates are quoted, economists call that a tax-inclusive quote: “I paid 23 percent last year.” If that were the case, for $100 one earned, $23 went to Uncle Sam. Or, “I had to make $130 to have $100 to spend.” That’s a 23-percent tax-inclusive rate.

We choose to compare the FairTax to income taxes, quoting the rate the same way, because the FairTax replaces such taxes. That rate is 23 percent.

Sales taxes, on the other hand, are generally quoted tax-exclusive: “I bought a $77 shirt and had to pay that same $23 in sales tax. This is a 30-percent sales tax.” Or, “I spent a dollar, 77¢ for the product and 23¢ in tax.” This rate, when programmed into a point-of-purchase terminal, is 30 percent.

Note that no matter which way it is quoted, the amount of tax is the same. Under an income tax rate of 23 percent, you have to earn $130 to spend $100.

Spend that same $100 under a sales tax, you pay that same $30, and the rate is quoted as 30 percent.

Perhaps the biggest difference between the two is under the income tax, controlling the amount of tax you pay is a complex nightmare. Under the FairTax, you may simply choose not to spend, or to spend less."

http://www.fairtaxvolunteer.org/smart/faq-main.html#47

Simple, huh? 23% is actually 30 cents on the dollar.

[JOHN W K]

ancient__geezer posted:

Federalist #21:

The principle of regulating the contributions of the States to the common treasury by QUOTAS is another fundamental error in the Confederation.Its repugnancy to an adequate supply of the national exigencies has been already pointed out, and has sufficiently appeared from the trial which has been made of it. I speak of it now solely with a view to equality among the States. Those who have been accustomed to contemplate the circumstances which produce and constitute national wealth, must be satisfied that there is no common standard or barometer by which the degrees of it can be ascertained. Neither the value of lands, nor the numbers of the people, which have been successively proposed as the rule of State contributions, has any pretension to being a just representative.

And so, A.G., they tied representation and direct taxation together to form a just rule for State contributions if a direct tax was found to be necessary!

My goodness A.G., you posted all that again, just to confuse and distort the truth and facts. Haven’t you yet learned that you cannot change the truth to what it is not?

The truth and facts are as follows:

In summary, the following is what the founders intended with regard to direct taxation:

1. Congress ought not raise money by borrowing, but when the money arising from imposts duties and excise taxes are insufficient to meet the public exigencies, and Congress has raised money by borrowing during the course of a fiscal year, Congress ought then lay a direct tax for an amount sufficient to extinguish the deficit, and apply the revenue so raised to extinguishing said deficit.

2. When Congress lays a direct tax it ought to immediately calculate each State's apportioned share of the tax based upon its number of Representatives as allotted by the Constitution, and then notify the Executive of each State of its apportioned share of the total tax being collected and a final date by which said tax shall be paid into the United States Treasury.

3. Each State ought to be free to assume and pay its quota of the direct tax into the United States Treasury by the final date set by Congress, but if any State shall refuse or neglect to pay its quota, then Congress ought to send forth its officers to assess and levy such State's proportion against the real property within the State with interest thereon and against the individual owners of such property having been assessed.

4. When a direct tax is laid by Congress, provision ought to be made for a discount for those States paying their share by a date set by Congress, and a lesser discount if paid by a final date set by Congress, such discount being to defray the States' cost of collection.

Now, A.G. how does one confirm this was the intention of the founders? Just read from the state ratification documents as to what the founders intended with regard to direct taxation:

Ratification of the Constitution by the State of New Hampshire

Fourthly That Congress do not lay direct Taxes but when the money arising from Impost, Excise and their other resources are insufficient for the Publick Exigencies; nor then, untill Congress shall have first made a Requisition upon the States, to Assess, Levy, & pay their respective proportions, of such requisitions agreeably to the Census fixed in the said Constitution in such way & manner as the Legislature of the State shall think best and in such Case if any State shall neglect, then Congress may Assess & Levy such States proportion together with the Interest thereon at the rate of six per Cent per Annum from the Time of payment prescribed in such requisition-

Ratification of the Constitution by the State of Massachusetts

Fourthly, That Congress do not lay direct Taxes but when the Monies arising from the Impost & Excise are insufficient for the publick exigencies nor then until Congress shall have first made a requisition upon the States to assess levy & pay their respective proportions of such Requisition agreeably to the Census fixed in the said Constitution; in such way & manner as the Legislature of the States shall think best, & in such case if any State shall neglect or refuse to pay its proportion pursuant to such requisition then Congress may assess & levy such State's proportion together with interest thereon at the rate of Six per cent per annum from the time of payment prescribed in such requisition

Ratification of the Constitution by the State of South Carolina;

Resolved that the general Government of the United States ought never to impose direct taxes, but where the monies arising from the duties, imposts and excise are insufficient for the public exigencies nor then until Congress shall have made a requisition upon the states to Assess levy and pay their respective proportions of such requisitions And in case any state shall neglect or refuse to pay its proportion pursuant to such requisition then Congress may assess and levy such state's proportion together with Interest thereon at the rate of six per centum per annum from the time of payment prescribed by such requisition-

But were the above stated intentions generally understood and agreed to by the founders and then practiced by actual legislation which would confirm such intentions? Well, let us read from the legislative Acts in which the direct tax is laid:

APPORTIONMENT OF A DIRECT TAX TO RAISE A TOTAL OF $ 2 MILLION TREASURY DEPARTMENT MAY 25TH 1798

An Act to lay and collect a direct tax within the united states [1st direct tax July 14, 1789 for $2 million and each state’s share of the $2million being raised.]

An Act to repeal the internal taxes April 3rd, 1802

And Act for the assessment and collection of direct taxes, July 22, 1813

Act laying a direct tax for $3 million August 2, 1813, and each state’s share of the tax

Section 7 of direct tax of 1813 allowing states to pay their respective quotas and be entitled to certain deductions.

And., as I have previously documented for you, For a $20 million direct tax being imposed upon the states in 1861, and the amounts required to be paid by each of the various states, see HERE and use the buttons at the bottom of the page to go forward and backward to read the legislation.

As I stated A.G. you cannot change the truth to what it is not!

Sincerely,
JWK
ACRS

"The strength of the Constitution, lies in the will of the people to defend it."-- Thomas Edison

[ancient_geezer]

To bad the other ratification documents failed to support your ideology isn't it. I note that 3 or four states even proposed and amendment that federal taxes be made contigent upon voter approval, strange how it never made it into the Bill of Rights after being rejected by most states.

Bye the way what is the bill number legislation sponsored in Congress that contains your proposals? You do have at least one Congress critter supporting your proposals do you not?

[DakotaRed]

Nice quotes. But, you somehow fail to realize we all see the current system is broken and needs done away with. However, several of us also see that simply changing the way taxes are collected does not replace anything, it just keeps it all going.

Since you appreciate quotes, here is one for you;

"The sales tax violates the principle of ability to pay. It falls more heavily on the poor; it is, in fact, a "spare-the-rich" tax. A sales tax taking 10 percent of income at the $500 level would take 6 percent at $2,500 and 3 percent above $10,000. It is bad economics to increase the tax load on people who have all they can do to feed and clothe themselves and their families. A sales tax would reduce their productive efficiency and might require Federal relief for them." FDR, 14 April 1942

Could the Federal relief he mentioned come in the form of "prebate checks" every month?

[JOHN W K]

pigdog wrote:

“Certainly Congress is not going to repeal the income tax simultaneously with depending on it for income as a tax method. That makes no sense at all. The call for repealing the 16th first is something long promoted by those wishing to retain the present system or something very like it. As such, it is a call to basically do nothing since Congress will not cut off their nose to spite their face. It is for this reason that you are actually defending the status quo whether you are aware of it or not. Dick Armey used to use the same technique in his debates trying to promote an income-based flat tax.”

Making things up again, pigdog?

The truth is, as I previously pointed out, repealing the 16th Amendment with the wording I proposed, does not promote retaining “…the present system or something very like it.” You are telling a bald faced fib because a repeal of the 16th Amendment with the wording I proposed, leaves Congress with sufficient taxing power to raise a federal revenue from external taxes and internal taxes, which would include an inland consumption tax on specifically selected articles selected for taxation. And, this does not even take into account Congress‘ power to lay a direct apportioned tax among the states to extinguish an annual deficit should Congress not raise sufficient revenue from impost, duties and excise taxes.

Why do you tell so many fibs?.

JWK

[DakotaRed]

Hasn't happened under the progressive income tax system that assures over half the electorate does not participate in paying the government bill has it. You figure that is going to change sometime soon keeping a tax system that promotes and fosters socialist redistribution with the majority of the electorate out of the loop?

And you figure it's going to change by simply passing the way taxes are collected, while simply calling for a repeal of the 16th Admendment? If you believe that, my ocean front property is in Oklahoma and would be real cheap for you ;)

[groanup]

I'm not really sure how to respond to your post since it seeems to be focused in opposing sides. The fair tax will untax the poor, PERIOD. Your post seems to say otherwise.