Posted on 09/08/2005 4:48:28 AM PDT by Your Nightmare
A bestseller advocating radical tax reform contains a critical flaw that misleads readers, according to a report in the October issue of MONEY Magazine.
...
While consumers would pay a federal sales tax on purchased items, the authors argue that prices at the store would stay the same. The reason: everyone involved in the process of production would no longer be paying taxes, so they could charge less for their goods and labor.
If true, that would mean a dramatic increase in Americans' purchasing power.
But, according to the MONEY report, the book fails to make clear that, in order for pre-tax prices to fall so sharply, companies would also have to cut wages they pay.
"Sure, you'd get to 'keep 100 percent of your paycheck,' as Boortz and Linder repeatedly write, but it would be a smaller paycheck," MONEY senior editor Pat Regnier writes. "That's kind of a big thing to leave out."
(Excerpt) Read more at money.cnn.com ...
$129.87 + State sales tax + local sales tax + city sales taxActually the tax is "of the gross payment".
Since all of those taxes are part of "the gross payment", following the letter of the law, it would have to be:
State sales tax + local sales tax + city sales tax + price TIMES the 0.30 fairtax rate
Lewis, stop trying to do math. All of your "calculations" assume that the income tax and sales tax bases are the same, which is incorrect.
Which, as you have been repeatedly shown, does not include non-federal taxes. But why spoil a mediocre lie with facts?
bttt
They never taught you what the words "gross" and "payment" means?
Silly me, I just read the definitions in the bill.
Why wouldn't they still have to pay payroll taxes?
I thought that was the purpose of the Fair tax - to eliminate payroll taxes.
Lewis, stop trying to do math.Why, because it exposes the fraud?
All of your "calculations" assume that the income tax and sales tax bases are the same, which is incorrect.All of my calculations aren't about the income tax. My calculations also included the employee's FICA and the employer's payroll tax that would be included in the Fairtax rate because the employer wouldn't be paying it...Someone has to.
Feel free to give your example. Will we have to wait untill you get back to work to use their computers and their time?..Just wondering.
How is $80,000 now and $80,000 under a NST a smaller paycheck if prices are reduced by the same percentage???
State sales taxes in Illinois are calculated on the retail price. The local sales tax is not added to the portion taxed by the state. By definition, a sales tax is a tax on sales, not a tax on the taxes of sales.
By definition, a sales tax is a tax on sales, not a tax on the taxes of sales.
Well by definition the Fairtax is a tax on payments...gross payments. Now prove to me a state or local sales tax isn't included in a "gross payment" in Illinois
`(b) Rate-
`(1) FOR 2007- In the calendar year 2007, the rate of tax is 23 percent of the gross payments for the taxable property or service.
How is $80,000 now and $80,000 under a NST a smaller paycheck if prices are reduced by the same percentage???Simple, "Revenue neutral"...
The government still needs the $20,000 they took from your $100,000. With your plan they'll have to get it from your $80,000.
Well, no AR, THAT"S not what the economist Jorgenson confirmed at all ... and you Status Quo Lover guys have been misrepresenting it ever since.
Why don't you post Boortz's claim that there was such an error for us to inspect. Your "doing the math" doesn't impress.
None of ou Squitrrels are even willing to admit there is such a thing as taxes embedded in prices that will be removed when the FairTax becomes law, but merely pretend that wages must fall - which is not true. Wages go up, not dowwn.
And as for Nightie's scare headline, that's just more hyperbole - which is right down the alley you guys play in.
You have been totally discredited and yet you still keep digging a deeper hole. Your whole arguement comes down to covering your ears while you kick and scream 'it's not true, it's not true.' You are pathetic.
Once again - not true. The "author" is an economist Jorgenson who made Assumptions about wages going down to simplify his model. That's ONE economist.
There are 75 others who say that, indeed wage-earners get all their wages ... 100% ... and they did so in their letter to the President and Congress endorsing the FairTax and urging that it be adopted.
Your spin stinks.
You are a piece of work. The "75 economists" did not sign a letter which said workers would keep 100% of their current paycheck AND prices will fall 20%. That is where the LIE is. You are just looking like a bigger and bigger fool by the post, so PLEASE keep going.
Nonsense, Rongie. You're just angry because I proved you wrong on your last set of misstatements about the FairTax and now you're trying some more hoping it won't be noticed.
It's noticed, and you're as wrong as the MONEY author who obviously knows as much about economic affairs as you.
Tell us all, my friend, how the simplifying assumptions of one economist for purposes of building his economic model will alter all the labor and worker contracts which are predicated on gross wages, not after-tax net. Answer - it won't - but you (and the MONEY writer who is obviously anti-FairTax) are willing to tell some untruths about it ... just like you.
It is quite clear that workers will get their gross wages after the FairTax becomes law and that their wages will increase. You SQLers have NEVER been able to show otherwise but merely just keep repeating the chant "wages will decrease", "wages will decrease". Tain't so.
Yes, I am wrong, the author is wrong, Dr. Jorgenson is wrong, Boortz is wrong, Linder is wrong. Everyone is wrong but the all knowing pigdog. What is your deal? Are you that ignorant.
There you go again - trying to put words in my mouth. My statement was that the 75 economists stated that workers would get 100% of their paychecks - which they clearly did state in their endorsement. Look it up and see:
http://www.fairtax.org/pdfs/Open_Letter_President.pdf
The tacking on of the statement of "20%" as though I claimed the 75 said that is simply more of your dishonesty - why can't you guys be truthful? Does it hurt your pride?
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