Posted on 10/26/2005 3:54:15 PM PDT by Jo Nuvark
Could we stop some of the abuse from illegal aliens by converting from an income tax that illegals avoid, to a federal sales tax that illegals cannot avoid?
Many illegals from Mexico pay no taxes and send much of their income home. A federal sales tax could discourage the abuses and possibly stem the human flood.
A fed sales tax would certainly catch up all who operate in the underground economy, but I don't see how this will effect illegals.
You've got to realize that a sales tax and income tax are extremely similar.
A sales tax is a percentage of GDP paid by the buyer. An income tax is a percentage of GDP paid by the seller. Have you heard of sales tax proponents talk about "embedded income taxes" in the price of goods? That is because it doesn't really matter whether the law says the buyer or seller should pay the tax, in the final analysis both a sales tax and an income tax are based on a percentage of economic activity.
A flatter tax system will boost real workers wages and simulatanieous reduce costs for businesses. This will stimulate more demand but wont increase inflation as the newer fatter tax freed paychecks will be buying these goods.
This could attract even more illegal workers as the economy will be needing more workers yet that lower tax rate could encourage both more automation and high wages for legal residents.
Bottom line is BETTER LAW ENFORCEMENT will reduce illegal immigration
Well... I was thinking that the impetus for illegals from Mexico is work. And from experience I have found they do not want to pay taxes. They want to KEEP all of their money to send home or to buy stuff. I have noticed the local Walmart has lines of illegals in the checkout, spending cash for everything. That's good for Walmart, but not for the Internal Revenue.
If taxes were FORCED through the sales tax, they might not be so excited about coming here.
Here's something else--tax reform has increased illegal immigration....taxes are practically non-existent for entry-level wages. That's thanks to the "tax the rich" rhetoric which led to having to prove one's self a compassionate conservative by almost eliminating taxes on low earners.
This gives the illegal workers a raise! They still work "on the books" in most positions, with fake ss#'s, which means that they get a lower withholding.
The "rich" still pay taxes for the schooling, prisons, and healthcare.
I am pro-tax in at least one regard. TAX ALL "ENVIOS DINERO" TRANSACTIONS OF CASH FROM THE US TO MEXICO. Tax it heavily. If illegals want to send their earnings to Mexico, let them send cash in an envelope and get it stolen, or let them pay 15% to send it electronically.
No brainer. We're losing the money, there's no downside on this tax. It'd amount to billions, and might help finance a prison or two.
This is absolutely false.
Any underground economy transaction that isn't captured by the income tax (e.g. drug deals) won't be captured by a sales tax.
Any legal transaction (e.g. the purchase of a fancy Cadillac) will be captured by either an income tax and a sales tax.
[...How about a tax of fifty percent on all money orders and money transfers sent to mexico?...]
I hadn't thought of that. Is that legal? Are you making a joke. I hope not. It's brilliant.
Sure it would effect them. 18% on the $900 price of a 1986 Ford Econoline Conversion van (come on, admit it, you've seen a van full of Mexicans on your city's thoroughfares on your morning commutes) would equal $164 of NEW, NEW NEW!!! tax revenue!
Illegals would not be able to apply for these rebates ... unless of course they bought the appropriate illegal ID cards.
Presumably illegals would not be eligible for this refund which would increase the tax burden on them. That suits me fine! I doubt it would stop the flow but it would offset some of the harm they do to taxpayers. I doubt most of them make/spend enough money so that they would cease to be a burden for taxpayers. For example, each of their kids in public school costs taxpayers about $8000 per year and it would take a lot of sales tax to cover that let alone their more typical 3 to 5 kids.
You wanna stop the flood of illegals? Go after the SOB employers who hire them. Enforce the law. It is ILLEGAL to hire an illegal alien. Dry up the demand for them and they will go back home. The flat tax is a whole seperate issue.
Brilliant? I think it was a joke. Of course it's not legal.
Under our present system the cost of illegal immigration is created chiefly buy the children of the illegal immigrants.
The abuse of illegal immigration can remedied by our present immigration regulations should the federal government choose to enforce them.
I wasn't refering to drugs and other illegal activiies, or for that matter, barter deals.
You're post is encouraging. I thought I was on to something. Did you read Post #5? This guy seems to understand the subtext of our tax issues.
The point is that there is no transaction that the sales tax can capture that the income tax doesn't. Sales taxes can't capture the underground economy any better than income taxes.
Illegals don’t come to the US to avoid taxes. They come to get jobs here because there are none at home in Mexico.
Such a tax may increase tax collections on Mexican illegals but it would do nothing to stem the tide of illegal immigration because it would not in anyway relieve the economic pressure that drives them from their native land.
President Fox needs to increase his efforts to drive corruption from the Mexican government and increase capitalist reforms of the Mexican economy to relieve the disparity of opportunity North and South of the border.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.