Replies

I see a lot in your post that makes our points.

If the share of taxes paid by the rich declines significantly (and it will under the NRST),

This not necessarily true at all. If I were "rich" as opposed to just having a high income, my options differ. If I won the 100 million dollar lottery tomorrow I would put all of it into Georgia municipal bonds and live off of the income and pay no state or federal income taxes. If I did the same thing under the fair tax I would pay taxes every time I bought something new.

From Rush Limbaugh's website

Exactly. The top 50% of wage earners pay 96% of all taxes yet the bottome 50% who pay merely 4% have just as much voting power as those paying their way. Under a NRST the non-productives would not be in such a privileged position of voting themselves largesse from the producers. The NRST is the ONLY way I see to avoid what is becoming invevitable - the loss of our republic because voters can vote themselves a free ride.

The rest of your post makes assumptions about tax brackets that I don't think you can make without citing sources. It also makes assumptions about the behavior of high income earners under a fair tax.

Dear groanup,

"This not necessarily true at all."

Well, actually, it pretty much is necessarily true.

Rush's numbers show that 27.5% of the income enjoyed by the top 1% of households is paid in federal income tax. I guess not as many of these folks are buying Georgia tax-free municipal bonds as one might think.

Remember, that's the ENTIRE top 1%, not just the folks near the bottom of that 1%, not just the folks making $500K per year, but folks also making $5 MILLION per year, and MORE.

These are aggregate numbers. 27.5% of the income of the entire 1% is going to the feds in the form of personal income taxes.

Even if, as a group, this entire 1% spends 100% of its income on 100% taxable stuff, the average amount of income paid in tax, under the NRST, would fall to 23%.

I think that's an unrealistic "if," but it represents, for the NRST argument, the best case. Almost tautologically, the federal tax burden for the very rich will fall.

"Exactly. The top 50% of wage earners pay 96%..."

Yes, but that wasn't the point. The point was that the top ONE percent pay THIRTY-FOUR PERCENT of federal income taxes.

And they pay on AVERAGE 27.5% of their income in federal income taxes.

Even if they spend every penny, the amount of tax they pay will fall.

"Exactly. The top 50% of wage earners pay 96% of all taxes yet the bottome 50% who pay merely 4% have just as much voting power as those paying their way. Under a NRST the non-productives would not be in such a privileged position of voting themselves largesse from the producers. The NRST is the ONLY way I see to avoid what is becoming invevitable - the loss of our republic because voters can vote themselves a free ride."

Nothing changes. 50% of folks STILL will pay no tax after the prebates apply, and politicians will STILL play one class off against the other. It will start with returning some of those "middle class entitlements."

One big weakness the NRST has currently, from a political perspective, is that it will be charged on health insurance. Most middle and upper middle class folks receive hefty subsidies from their employers for this currently tax-free benefit.

With the NRST, it won't be tax-free, anymore. So, if the health insurance costs $750 per month, SOMEONE'S going to have to come up with an extra $225 per month. As an employer, I know who is going to take the hit. It ain't me, LOL. My profits wouldn't sustain the hit. Middle class folks are going to get squeezed by this.

That will be the thin edge of the wedge. I can hear ol' Chappaquiddick Ted, now:

"The NRST didn't repeal the 16th amendment, and RICH FOLKS ARE PAYING LOTS LESS, now, under the NRST!! Let's put a modest 5% income tax back on folks making $200K and up per year (or $400K, or $600K, or whatever sells politically)! And we can exempt health insurance from the NRST! After all, we exempt EDUCATION! Health insurance isn't less important or vital as education!! It's fer the chilrun, doncha know?"

LOL. At that point, you've appealed to the pocketbooks or the class jealousy of 99% of taxpayers.

sitetest