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VANITYY: Will a Flat Federal Sales Tax Stop the Flood of Illegals?
10/26/05 | Jo Nuvark

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.


TOPICS: Your Opinion/Questions
KEYWORDS: immigrantlist; taxfraud; wot
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To: SolidSupplySide

How about a tax of fifty percent on all money orders and money transfers sent to mexico?

I never thought I'd see advocacy of taxes on US exports on Free Republic.



Actually, when dollars go out, that is called "importing" whatever the dollars are exchanged for (in this case, Mexican labor).

When we export stuff, others send us money.


61 posted on 10/26/2005 4:57:34 PM PDT by Atlas Sneezed (Your FRiendly FReeper Patent Attorney)
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To: SolidSupplySide; ancient_geezer
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.

What you say is trivially true, but it omits the discussion about the portion of tax collected.

IN an income tax, the portion collected represent the taxes that everyone pays on purchases - and this represents only a portion of tax burden. If a drug dealer pays no income or payroll tax on his illegal income, he does still pay embedded taxes in prices as you noted. But he pays nothing more. Today, embedded taxes represent one of three components of ones tax burden... there are embedded taxes, income taxes, and payroll (self-emp) taxes. A drug dealer only pays a portion of his tax burden (the embedded portion). He does not pay income or payroll tax on his illegal money.

Contrast this to a sales tax situation; ie ones entire tax burden is comprised of a single component - taxes on purchases. Hence under a sales tax (like hr 25), the drug dealer begins paying his FULL share of taxes.

Under the income tax, the drug dealer pays only a portion of his taxes (embedded tax in prices). He does not pay the remainder of his taxes in income and payroll tax.

Under the nrst, the drug dealer pays his full share of taxes.

It should be obvious that the drug dealer pays more tax under an nrst - meaning the rest of us don't have to carry him any longer.

I'm not saying more money is collected from underground with an nrst, I'm saying that it comes from who it should come from - which is obviously better.

This being said, I don't know if an nrst would reduce illegal immigration - but it WOULD begin collecting the maximum rate from them.

62 posted on 10/26/2005 4:57:50 PM PDT by Principled
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To: henderson field
I never said any of them came here to build a nation. I stated some come here just to make more money then they can at home. Others come here for much more sinister reasons i.e. M-13 members who are nothing more than hired thugs for drug runners. Those that come here to help build a great nation as you stated do it the proper way (and they are also punished/hurt by illegal immigration).AWB
63 posted on 10/26/2005 4:59:24 PM PDT by Americanwolfsbrother (Don't hate on someone for using their mind.)
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To: Principled

[...The difference to be recognized is the difference in how an income tax treats an illegal versus the way a sales tax would...]

You lost me.


64 posted on 10/26/2005 4:59:26 PM PDT by Jo Nuvark
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To: SolidSupplySide
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.

i disagree. I think the point is that under an income tax, underground income earners pay only a portion of their tax burden - the portion embedded in prices (the do NOT pay income or payroll taxes).

But under an nrst, illegal income earnes pay 100% of their tax burden.

65 posted on 10/26/2005 5:03:12 PM PDT by Principled
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To: Principled

[...I don't know if an nrst would reduce illegal immigration - but it WOULD begin collecting the maximum rate from them...]

But... But... But... it would reduce our problem with the illegals and that being the drain on social services.


66 posted on 10/26/2005 5:06:06 PM PDT by Jo Nuvark
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To: Jo Nuvark

Take away our liberal social net, and watch them flock back home.


67 posted on 10/26/2005 5:07:38 PM PDT by jeremiah (People wake up, the water is getting hot)
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To: Jo Nuvark
THe income tax treats illegal immigrants differently than a sales tax would treat illegal immigrants.

Specifically, an income tax allows an illegal immigrant to earn money and pay no income tax and pay no payroll tax. Hence an illegal immigrant only pays a portion of his tax burden (the portion we all pay in the prices of the goods we buy).

It is in this respect that a sales tax treats illegal immigrants differently. A sales tax does not allow an illegal immigrant to avoid any portion of his tax burden. This is because an illegal immigrant's FULL tax burden is paid via purchases (as would be everyone's).

So the sales tax collects all requisite taxes from an illegal immigrant, while the income tax collects only a portion of the requisite taxes. THat's a difference that is important.

68 posted on 10/26/2005 5:11:31 PM PDT by Principled
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To: Jo Nuvark

A federal sales tax could discourage the abuses and possibly stem the human flood



How do you see this happening?.... It seems to me that a tax on goods at the rate it would be imposed and the amount of purchases they make here in the US would have little or no impact upon the total illegal immigration numbers. They work here and send as much as they can back home to support their families. True they some spend money here but I don't think a consumption tax will offset the value they see in working here and sending money back to their homeland. jmo.


69 posted on 10/26/2005 5:12:13 PM PDT by deport
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To: jeremiah

[...Take away our liberal social net, and watch them flock back home...]

At last... someone who gets it!


70 posted on 10/26/2005 5:12:24 PM PDT by Jo Nuvark
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To: glockmeister40
How about a tax of fifty percent on all money orders and money transfers sent to mexico?

Then some enterprising little mexican will setup shop in Canada to do two stage wire transfers for 5% and make a killing.

71 posted on 10/26/2005 5:12:52 PM PDT by Centurion2000 ((Aubrey, Tx) --- America, we get the best government corporations can buy.)
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To: Jo Nuvark
But... But... But... it would reduce our problem with the illegals and that being the drain on social services.

It would bring in more tax money from them to help offset their drain on social services. But I dunno if it would reduce their numbers. I think they'll come for work and $ and to escape the hell-hole that is Mexico.

72 posted on 10/26/2005 5:14:44 PM PDT by Principled
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To: deport

Copy of Post #7: 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.


73 posted on 10/26/2005 5:16:50 PM PDT by Jo Nuvark
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To: Jo Nuvark; jeremiah
[...Take away our liberal social net, and watch them flock back home...]

This sir, bears repeating:

[...Take away our liberal social net, and watch them flock back home...]

74 posted on 10/26/2005 5:17:07 PM PDT by Principled
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To: Centurion2000

Then some enterprising little mexican will setup shop in Canada to do two stage wire transfers for 5% and make a killing.
______________________________
Sounds like a great business for an anglo too?


75 posted on 10/26/2005 5:18:02 PM PDT by Jo Nuvark
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To: Nat Turner; Principled; SolidSupplySide; Conservative Goddess
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.

One obvious way, a retail sales tax would give the federal government a monetary stake in contolling the boarders to stem the flow of contraband and smuggling. Today there is little real incentive for the feds to actually do anything at all.

Put revenues at risk and watch border control become a primary focus in tax enforcement.

76 posted on 10/26/2005 5:25:23 PM PDT by ancient_geezer (Don't reform it, Replace it!!)
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To: AuH2ORepublican
but at least they'd be paying more than their fair share of sales taxes.

Not at all. The huge cost of illegal immigration is the cost of the social safety net the US provides to the progeny of illegal immigrants over successive generations , chiefly education and health care. Children don't pay taxes.

Each child of an illegal immigrant costs the state of California, conservatively, between $200K to $300K from birth until age 18. These same children contribute little to the state tax revenues during that same period.

77 posted on 10/26/2005 5:26:58 PM PDT by Amerigomag
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To: Principled

I think they'll come for work and $ and to escape the hell-hole that is Mexico.



That is why Lady Liberty's arms are open. America still welcomes the downtrodden, but you've got to give a little (in taxes) in order to get.


78 posted on 10/26/2005 5:27:45 PM PDT by Jo Nuvark
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To: Jo Nuvark
America still welcomes the downtrodden, but you've got to give a little (in taxes) in order to get.

Indeed. You takee services you payee the taxes.(ancient chinese proverb).

79 posted on 10/26/2005 5:29:54 PM PDT by Principled
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To: Jo Nuvark
Considering that the plan for a federal sales tax includes a monthly "pre-bate" check sent to every person regardless of if they work or not, I think it would encourage more immigration in order just to get the monthly check.
80 posted on 10/26/2005 5:30:19 PM PDT by FreedomCalls (It's the "Statue of Liberty," not the "Statue of Security.")
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