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FAIR TAX BOOK- 2nd Ed. Revisions
self | May 5. 2006 | RobFromGa

Posted on 05/05/2006 1:35:32 PM PDT by RobFromGa

In my letter to Rep. Linder and Mr. Boortz of August 24, 2005, I pointed out a number of what I called “serious misrepresentations” of the Fair Tax plan contained in “The FairTax Book”. I specifically named many of these by page #.

Now that the revised second issue is out, let’s see what they did to these passages in the book:

First edition page 55, you go on to explain that these embedded taxes are “in addition to the money taken out of your check in income and payroll taxes.”

Second edition- this line was eliminated. This means that they are acknowledging that the 22% embedded taxes INCLUDE the income and payroll taxes which was one of my points all along.

First edition page 59, “Once the FairTax takes effect, you’ll be receiving 100 percent of every paycheck, with no withholding of federal income taxes, Social security taxes, or Medicare taxes and you’ll be paying just about the same price for T-shirts and other consumer goods and services that you were paying before the FairTax.”

Second edition- “Once the FairTax takes effect, you’ll be in complete control of your paycheck as nothing will be withheld and your purchasing power for t-shirts and all other goods and services will be almost exactly what it was before the FairTax.”

This means that they are acknowledging that “purchasing power” will remain the same, not a big increase in purchasing power as they previously asserted with their larger paychecks/same prices verbiage. They eliminated the “100% of paycheck” wording.

First edition page 83: “Remember that the poor, along with everyone else—will no longer have Social Security taxes or Medicare taxes removed from their paychecks. Whatever they earn, they get on payday. For most of those we categorize as poor, this would mean an immediate 25 to 30 percent increase in their take-home pay.”

Second edition- “Remember that the poor, along with everyone else—will no longer have Social Security taxes or Medicare taxes removed from their paychecks. Whatever they earn, they get on payday. If employers leave this money in paychecks instead of taking it out of price, most of those we categorize as poor, this would mean an immediate 25 to 30 percent increase in their take-home pay.”

Of course, this acknowledges that the employer has a choice to make—to pay the worker his current paycheck and not reduce prices (meaning prices with FairTax added go up 30%) or to cut paychecks to present takehome levels. They cannot both give workers more takehome pay and reduce prices. The Free Lunch described in the first edition is eliminated.

First edition, page 84, you make it clear though that even though the workers will keep all of their paychecks for a big raise, you still believe that because of “the disappearance of the embedded taxes, the total price paid for consumer goods will remain very nearly the same”.

Second edition—“when you factor in the combined lower prices/higher takehome pay caused by the disappearance of the embedded taxes” prices will remain about the same.

This again acknowledges that they money currently deducted as taxes can either be used to increase take-home pay or reduce prices but not both at the same time. If they were being more honest here, they would have referred to purchasing power remaining the same rather than prices, but they are trying to put the best possible spin on this major admission.

First edition page 111, you tie it all together with a Quick Review in which you erroneously assert that “Here’s what happens when we pass and implement the FairTax plan:

“We start collecting 100 percent of our earnings on our paycheck.

“We all get virtual raises, since payroll taxes are no longer siphoned from our checks.

“The prices of consumer goods and services remain essentially the same, with the removal of the embedded taxes compensating for the added consumption tax.”

Second edition:

“We start controlling our earnings in every paycheck” (whatever that means)

“100% earnings” line is eliminated from the second edition. "virtual raises" is likewise eliminated.

“Our purchasing power for buying consumer goods and services remains essentially the same, with the removal of the embedded taxes compensating for the added consumption tax.”

This is a MAJOR difference in the Quick Review! In the first edition, they promised larger paychecks and prices remianign the same—which means a major increase in purchasing power. Of course this was a ridiculous promise. In the second edition, they say our purchasing power will be about the same.

They still left a lot of wrong and misleading verbiage throughout the book, but they addressed most of the concerns that I sent to them and removed those claims in the second book.


TOPICS: Your Opinion/Questions
KEYWORDS: dontbuythebs; dontdrinkthekoolaid; fairtax; fairtaxisafraud; fraudtax; koolaiddrinkers; onlyflattaxisfair; onlyflattaxisfairtax
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ping


21 posted on 05/05/2006 3:29:51 PM PDT by groanup (Shred for Ian)
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To: RobFromGa

In the past few years, I've seen "conservatives" grow nonmilitary discretionary spending faster than most Democrat administrations, oppose border security, propose amnesty by another name for illegal aliens, create a trillion-dollar health care entiitlement program, start a new Cabinet-level executive department to waste billions on anything but profiling fundamental Islamists, and federalize education. Now we have "conservatives" opposing new alternatives to the IRS and progressive unapportioned taxation??

Sigh. Would the last person to support limited constitutional government please turn out the lights?


22 posted on 05/05/2006 3:33:14 PM PDT by Turbopilot (Nothing in the above post is or should be construed as legal research, analysis, or advice.)
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To: groanup; RobFromGa
Too bad Rob's email answer was referring to Jorgenson's testimony describing a generic consumption tax system designed to replace income taxes only.

His source does not address, the effects of replacing the corporate excise taxes on wages paid, nor the effects of providing a general rebate to each legal resident as well.

Quite a long way from what the FairTax tax system is designed to do, not to mention that most wages paid in the U.S. are controlled by contract and not adjustible downward in the manner that Jorgenson's 1996 assumptions about wages paid to workers presumes for simplification purposes.

Per Jorgenson's statement in Rob's reference, not only does Jorgenson reference a work not analyzing the provisions of the Fair Tax Act, he goes on to tout his own favored plan of a system taxing wages and sales taxes to boot, his "Efficient Taxation" model.

Per Jorgenson and Rob's not therein.

August 24

Dear Rob,

A more reasonable interpretation of my 1996 testimony is that workers would keep that after-tax pay; producers' prices would fall, but retail prices would be increased by the national retail sales tax. Any gains by workers and investors would be the result of increase economic efficiency.

[He then went on to recommend his book called LIFTING THE BURDEN, about another tax reform plan he calls Efficient Taxation]

Best,
Dale

The '96 testimony on which this screed is based on, testimony, when given made no mention of Jorgenson's assumptions about wages:

 

Jorgenson Testimony 1996

====== FULL TEXT ======

This statement was prepared for presentation at the Hearings on Replacing the Federal Income Tax, before the Committee on Ways and Means, U.S. House of Representatives, 104th Congress, Second Session.

THE ECONOMIC IMPACT
OF TAXING CONSUMPTION

by
Dr. Dale W. Jorgenson,
Harvard University

INTRODUCTION AND SUMMARY

[1] In this testimony I consider the economic impact of substituting a tax on consumption fro corporate and individual income taxes at federal, state, and local levels, beginning January 1, 1996. I limit my analysis to a revenue neutral tax substitution -- one that would leave the government revenues unchanged. Finally I focus on the impact of fundamental tax reform on economic growth, leaving progressivity of the resulting combination of taxes and government expenditures to be determined by adjustment of expenditures. I have summarized my conclusions in a services of eight charts appended to the text of this prepared statement. These were generated by stimulating future U.S. economic growth with and without the change in tax policy. Further details are provided in an Appendix to this statement.

1. The revenue neutral substitution of a consumption tax for existing income taxes at both federal and state and local levels would behave an immediate and powerful impact on the level of economic activity. The first chart shows that U.S. gross domestic product (GDP) would increase initially by about thirteen percent; this increase would decline to around nine percent.

2. The imposition of a consumption tax would produce in a sharply higher tax rate on consumer goods and services. The second chart shows that the consumption tax rate required for replacing existing revenues from individual and corporate income taxes at both federal and state and local levels would be around fifteen percent. This would gradually rise over time reaching twenty-one.

3. As a consequence of the total transformation of the tax system, individuals would sharply curtail consumption of both goods and leisure. This would produce a dramatic jump in saving and a substantial rise in labor supply. These increases would subside only very gradually over time.

4. Taxation of consumption would induce a radical shift away from consumption toward investment. The third chart shows that real investment would leap upward by eighty percent! The fourth chart shows that real consumption would initially decline by around five percent, but consumption would grow rapidly and overtake the level under the income tax within two years.

5. Since producers would no longer pay taxes on profits or other forms of income from capital and workers would no longer pay taxes on wages, prices received by producers, shown in the fifth chart, would fall by an average of twenty percent with substantial relative gains for investment goods producers.

6. In the long run producer's prices, shown in the seventh chart, would fall by more than twenty-five percent relative to prices under an income tax. The shift toward investment and away from consumption would redistribute economic activity among industries. The eight chart shows that output would increase in all industries, but the rise in production of investment goods would be greatest.

IMPLEMENTATION OF A CONSUMPTION TAX

[2] In Hearings on Replacing the Federal Income Tax, held by the Committee on Ways and Means last June, testimony focused on alternative methods for implementing a consumption-base value added tax. This is economic jargon for a consumption tax, where value added is the sum of capital and labor incomes and subtracting investment form value added would produce a consumption tax base. An alternative and equivalent definition of this tax base is the difference between business receipts and purchases from other businesses, including investment goods. A third definition of the tax base is the total of retail sales to consumers.

[3] The three principal methods for implementation of a value added tax correspond to the three definitions of consumption as the tax base:

1. The invoice and credit method. Business invoices would include a credit against tax liabilities for value added taxes paid on goods and services received. This method is used in Canada and Europe. In Canada and many other countries the value added tax replaced an earlier and more complex system of retail and wholesale sales taxes. From the point of view of tax administration the invoice and credit method has the advantage that both purchases and sales generate records of the tax credits. The invoice and credit method would require substantial modification of collection procedures, but decades of experience have ironed out many of the bugs./1/

2. The subtraction method. Business purchases from other businesses, including investment goods, would be subtracted from business receipts, including proceeds from the sales of assets. This could be implemented within the framework of the existing tax system by integrating individual and corporate income taxes, as proposed by the U.S. Treasury (1992), and treating all businesses as partnerships or "subchapter S" corporations. The second step would be to allow expensing of investment in the year it is taken. Enforcement problems would be reduced by drastically simplifying the tax rules, /2/ but the principal method of enforcement, auditing of tax payer records by the Internal Revenue Service would remain.

3. National retail sales tax. Like existing state sales taxes, a national retail sales tax would be collected by retail establishments, including service providers and developers fro residential real estate fro sale to owner-occupiers. This would also require a new system for tax administration, possibly sub-contracting the actual collection to existing state agencies. The Internal Revenue Service could be reduced to an agency that would sub-contract collections. Alternatively the IRS could be abolished and an new agency created for this purpose. /3/ Enforcement procedures could be limited to those used by the states.

[4] All three alternative methods for implementing a consumption tax could be based on the same definition of the tax base. This greatly simplifies the tax economist's task, since the economic impact would be the same for all three approaches. This leaves important issues to be resolved by other tax professionals, including, especially, tax lawyers who would write the legislation and the implementing regulations and tax accountants who would translate the laws and regulations into accounting practice and advise economic decision-makers about their implications.

[5] From the economic point of view the definition of consumption is straightforward; a useful and commonly accepted point of departure is Personal Consumption Expenditures (PCE) as defined in the U.S. national income and product accounts. However, the taxation of services poses important administrative problems reviewed in a U.S. Treasury (1984) monograph on the value added tax. First PCE includes the rental equivalent value of the services of owner-occupied housing, but does not include the services of consumer's durables. Both are substantial in magnitude, but could be taxed by the "prepayment method" described by the Hon. David Bradford(1986). In this approach taxes on services would be prepaid by including investment rather than consumption in the tax base.

[6] The prepayment of taxes on services of owner-occupied housing would remove an important political obstacle to substitution of a consumption tax for existing income taxes. At the time the substitution takes place all owner-occupiers would be treated as having been prepaid all future taxes in the services of their dwellings. This is equivalent to excluding not only mortgage interest from the tax base, but also returns to equity, which might be taxed upon the sale of residence with no corresponding purchase of residential property of equal or greater value.

Of course, this presumes that homeowners would refinance to take advantage of the altered tax treatment of mortgage lenders.

[7] It is essential to include housing and consumer's durables in the tax base in order to reap the substantial economic benefits of putting household and business capital on the same footing./4/

This raises politically sensitive issues and it is important to be clear about the implications of prepayment as the debate proceeds. Under the prepayment method purchases of consumers' durables by households for their own use would be subject to tax. These would include automobiles, appliances, home furnishings, and so on. In addition, new construction of owner-occupied housing would be subject to tax, as would sales of existing renter-occupied housing to owner-occupiers. Together with the exclusion of rental values of existing owner-occupied housing, this would maintain the asset values for housing.

[8] Other purchases of services that would be especially problematical under a consumption tax include services provided by nonprofit institutions, such as schools and colleges, hospitals, and religious and eleemosynary institutions. The traditional, tax-favored status of these forms of consumption would be defended tenaciously by recipients of the services and even more tenaciously by the providers. The argument can be made that educational services represent investment in human capital rather than consumption.

[9] Finally, any definition of a consumption tax base will have to distinguish between consumption for personal and business purposes. On going disputes over home offices, business-provided automobiles, equipment, and clothing, and business-related lodging, entertainment and meals would continue to plague tax officials, the entertainment and hospitality industries, and holders of expense accounts. In short, substitution of a consumption tax for the federal income tax system would not eliminate all the practical issues that arise from the necessity of distinguishing between business and personal activities in defining consumption. However, these issues are common to both income and consumption taxes.

CONCLUSION

[10] Under any one of the three approaches to implementation of a value added tax, substitution  of a consumption tax for existing individual and corporate income taxes would be the most drastic change in federal tax policy since the introduction of the income tax in 1913. It is not surprising that the economic impact summarized above would be truly staggering in magnitude. It is easy to foresee that as Americans become more fully apprised of the manifold ramifications of fundamental tax reform the Gucci Gulch/5/ will be transformed into the political equivalent of the Grand Canyon.

[11] The coming debate over tax reform is both a challenge and an opportunity for economists. It is a challenge because the impact of fundamental tax reform would involve almost every aspect of economic life. Economists who have spent their lives pre-occupied by the latest debating points in journals read only by other economists will suddenly find that the fine points that dominate scholarly discussion will be subjected to the refiner's fire of public scrutiny.

[12] The debate will be an opportunity of economists because economic research has generated a wealth of information about the impacts of tax policy. Provided that the economic debate can be properly focused, economists and policy makers will learn a great deal about the U.S. economy and its potential for achieving a higher level of performance. I am personally very gratified that the Joint Committee on Taxation under the leadership of Chief of Staff Kenneth Kies has taken the initiative in channeling the professional discussion. In my remaining testimony I will outline my own recommendations for the initial ground rules.

[13] The first issue in the debate will be the economic impact of the federal deficit. Nearly two decades of economic disputation over this issue has failed to produce any resolution. No doubt the dispute will continue well into the next century and preoccupy the next generation of fiscal economists, as it has the previous generation. An effective rhetorical device for insulating the discussion of fundamental tax reform from the budget debate is to limit consideration to revenue neutral proposals. This device was critical to the eventual enactment of the Tax Reform Act of 1986 and is, I believe, essential to progress in fundamental tax reform.

[14] The second issue to be debated is fiscal federalism or the role of state and local governments. Since state and local income taxes usually employ the same tax bases as the corresponding federal taxes, it is reasonable to assume that substitution of consumption for income taxes at the federal level would be followed by similar substitutions at the state and local level. Since and important advantage of a fundamental tax reform is the the possibility, at least at the outset, of radically simplifying tax rules, it does not make much sense to assume that existing rules would continue to govern state and local taxes, even if the federal income tax were abolished.

[15] The central issue in evaluating the economic impact of fundamental tax reform is its impact on economic growth. A serious barrier to focusing attention on growth is that the main apparatus for policy evaluation employed by both the Congress and the Administration consists of distributional tables for policy impacts. So far as I am aware, the methodology I have employed in preparing this testimony - comparing time paths of U.S. economic growth with and without a change in tax policy -- has never been used by either the Joint Tax Committee or the Office of Tax Analysis of the U.S. Treasury. Public discussion of tax reform will be crippled until this analytical gap is overcome.

FOOTNOTES

/1/ The advantages and disadvantages of the invoice and credit method for implementing the value added tax are discussed by the U.S. Treasury (1984).

/2/ A subtraction method value added tax has been proposed by Ranking Minority Member Sam Gibbons of the Committee on Ways and Means. If no business receipts were excluded and no deductions and tax credits were permitted, the tax return could be reduced to the now familiar post card size, as in the Flat Tax proposal of Majority Leader Dick Armey and Senator Richard Shelby(1995), Economists will recognize the Flat Tax proposal as a variant of the consumption-base value added tax proposed by Robert Hall and Alvin Rabushka (1995).

/3/ A national retail sales tax has been proposed by Chairman Bill Archer of the Committee on Ways and Means and Senator Richard Lugar

/4/ See for example, my testimony before the Committee on Ways and Means of June 6, 1995.

/5/ Few readers of this testimony will be unaware of this colloquial expression for the corridor outside the hearing room of he Committee of Ways and Means. The expression appeared in the title of the definitive account of the Tax Reform Act of 1986 by Jefferey H. Birnbaum and Alan S. Murray (1987).

APPENDIX

The simulations of U.S. economic growth summarized in the charts appended to this testimony are based on an intertemportal equilibrium model of the U.S. Economy that I have constructed with Peter J. Wilcoxen. The details of the model and more than a dozen applications are summarized in our survey paper, "Energy, the Environment, and Economic Growth," published in 1993. The model of U.S. economic growth is disaggregate4d to the thirty-five industries listed in the final four charts in my testimony. In addition the model distinguishes among 1344 types of households, disaggregated by family size, age and gender of household head, region of residence, race, and urban versus rural location. The model is built around sub-models of investment and saving based on rational expectations. The price of investment goods in every period is based on expectations of future capital service prices and discount rates that are fulfilled by the solution of the model.

In order to analyze the economic impact of changes in tax policy, we simulate the growth of the U.S. economy with and without changes in these policies. The first an most difficult step is to generate a simulation based on current tax policy. We call this the BASE CASE. We then produce and alternative simulation based on a consumption tax. This represents the alternative case. Finally we compare the base case with the ALTERNATIVE CASE in order to assess the effects of the substitution of a consumption tax for the existing income tax system. The most difficult part of tax policy evaluation is to project U.S. economic growth under the existing tax system. For this purpose I have introduced the characteristic features of U.S. tax law into the cost of capital, distinguishing among assets employed in three different legal forms of organization -- households and nonprofit institutions, non-corporate business, and corporations. Income from corporate business is subject to the corporate income tax, while distributions to households are subject to the individual income tax. Income from unincorporated businesses -- partnerships and sole proprietorships -- are taxed only at the individual level, while income from equity in household assets is not subject to the income tax.

REFERENCE

Armey, Dick, "Freedom and Fairness Restoration Act," Washington, D.C. 104th Congress, First Session, 1995.

Birnbaum, Jefferey H., and Alan S. Murray, Showdown at Gucci Gulch: Lawmakers, Lobbyists, and the Unlikely Triumph of Tax Reform, New York Random House, 1987.

Bradford David, Untangling the Income Tax, Cambridge, Harvard University Press, 1986.

Jorgenson, Dale., and Kun-Young Yun, Tax Reform and the Cost of Capital, New York, Oxford University Press, 1991

U.S. Department of the Treasury, Tax Reform for Fairness, Simplicity, and Economic Growth, Washington, U.S. Government Printing Office, 1984.

_____, Taxing Business Income Once, Washington, U.S. Government Printing Office, 1992.

[CHARTS OMITTED]


23 posted on 05/05/2006 3:34:22 PM PDT by ancient_geezer (Don't reform it, Replace it.)
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To: groanup
yep - bring up the links, print 'em out and learn for yourself.

http://www.fairtax.org/

http://www.geocities.com/cmcofer/ftax.html

24 posted on 05/05/2006 3:35:22 PM PDT by maine-iac7 ("...but you can't fool all of the people all of the time." LINCOLN)
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To: Dimples
"Now if we could get an honest appraisal of the "revenue neutral" tax rate ..."

Thats easy, The fairy tax would be "revenue neutral", but would shift 100% of taxes to consumers making 15-200k, and not owning a business.
25 posted on 05/05/2006 3:41:40 PM PDT by Beagle8U (Juan Williams....The DNC's "Crash test Dummy" for talking points.)
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To: RobFromGa
They'll say that Boortz is an idiot, probably.

You're right. Boortz is an idiot who wrote a bestseller about TAXES. Stupid idiot.

26 posted on 05/05/2006 3:48:29 PM PDT by groanup (Shred for Ian)
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To: groanup
"You're right. Boortz is an idiot who wrote a bestseller about TAXES. Stupid idiot."

Some idiot wrote a best seller about a white whale called moby dick, whats your point?
27 posted on 05/05/2006 3:57:26 PM PDT by Beagle8U (Juan Williams....The DNC's "Crash test Dummy" for talking points.)
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To: RobFromGa

I don't get it. So there's revisions. So that's grounds to throw the whole idea out?

Or is this just a way for you to pat yourself on the back?

Enlighten me.


28 posted on 05/05/2006 3:59:21 PM PDT by Imgr8t
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To: Beagle8U
Some idiot wrote a best seller about a white whale called moby dick, whats your point?

Obviously you didn't read what I was responding to.

But while you''re here:

Nothing in Moby Dick was in regard to putting vast power back into the hands of the American people where it belongs.

29 posted on 05/05/2006 4:04:21 PM PDT by groanup (Shred for Ian)
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To: groanup

www.fairtax.org=abortion

There, that looks better.


30 posted on 05/05/2006 4:54:28 PM PDT by xcamel (Press to Test, Release to Detonate)
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To: ancient_geezer
Too bad Rob's email answer was referring to Jorgenson's testimony describing a generic consumption tax system designed to replace income taxes only.

Well then why have the fairtaxers been using that Jorgenson quote for the last 10 years.

31 posted on 05/05/2006 5:08:50 PM PDT by Always Right
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To: Imgr8t
I don't get it. So there's revisions. So that's grounds to throw the whole idea out? Or is this just a way for you to pat yourself on the back? Enlighten me.

What embedded taxes means has been a contentious point of debate on this forum for over 7 years. The fairtaxers have maintained it did not include the taxes paid by employees. This admission just means that the fairtaxers have been fudging their analysis by some $1 Trillion per year.

32 posted on 05/05/2006 5:13:14 PM PDT by Always Right
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To: groanup
"Obviously you didn't read what I was responding to."

I have read every word on this thread, and most everything on the fairy tax website.

I'll wait to check the site again after they had to crawfish on the 2nd. edition of the corrected book.

Bestseller or not, a fairy tale is a fairy tale, it has as much truth as "Moby Dick".
33 posted on 05/05/2006 5:14:40 PM PDT by Beagle8U (Juan Williams....The DNC's "Crash test Dummy" for talking points.)
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To: Always Right
Nice to see more real economists starting to emerge from their bunkers and speak out against this huge fraud. The fair taxers are getting to be like the mob with torches rakes and forks chasing after Frankensteins monster, while the rest of us who actually work for a living and provide a benefit to society work tirelessly in the background to get true tax reform based on enforcing constitutionally limited government spending, and a fair, Flat Tax
34 posted on 05/05/2006 5:18:16 PM PDT by xcamel (Press to Test, Release to Detonate)
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To: xcamel

" get true tax reform based on enforcing constitutionally limited government spending, and a fair, Flat Tax"

BUMP!


35 posted on 05/05/2006 5:25:34 PM PDT by Beagle8U (Juan Williams....The DNC's "Crash test Dummy" for talking points.)
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To: Always Right

So put that into computer programmer speak (layman's terms). What's the net effect of this nugget of information?


36 posted on 05/05/2006 5:40:17 PM PDT by Imgr8t
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To: Beagle8U

I don't see anything fair about graduated rates for people who make more money.

Give me more info on exactly what you are proposing here.


37 posted on 05/05/2006 5:41:27 PM PDT by Imgr8t
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To: Imgr8t

It means the fairtax is not the free ride that is advertized. Your paychecks may go up, but so will prices. People with savings and on fixed income will be hurt by the fair tax. Not everyone will come out smelling like a rose as the fairtax website and all their propaganda says.


38 posted on 05/05/2006 5:45:07 PM PDT by Always Right
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To: Always Right

I never saw it as a free ride.

The ONLY argument I've ever heard against the fair tax that I've questioned, is about taxes already paid on saved money. Which is a very, very good question.

Look, I'm not looking for a smoking gun here in either camp, I just want a solution to the freakin IRS audit I'm having to go through. We all agree that the current system is a steaming turd. It needs repair, and our government needs to lose control of the ability to get their hands on it so easy.

So I ask, if you are taxed on what you spend, and you're on a fixed income.. how does it hurt you?? In the end, you are the one controlling how much you spend.

I'm not trying to argue, I want to learn - so help me out.


39 posted on 05/05/2006 5:51:59 PM PDT by Imgr8t
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To: xcamel; All
ANTI-FAIR TAXERS WOULD NATURALLY BE:

A. Life insurance and annuity salesmen. Whole Life and annuity products that have more fees for brokers than benenfits for clients are going to lose their tax status, which is one of the "selling points" that mis-informed hawkers of these products think will kill their business.

B. Tax software creators, salesmen, jobbers. Think about the industry around Turbo Tax and the like. No one can figure out the tax code and Turbo Tax does little to help.

C. IRS employees. What, 130,000? More than the FBI? What in the hell do we need them for? We just need a clerk for each state to tally the sales tax.

D. Home builders. In some convoluted way these people think that the tax code is necessary to keep their businesses afloat. Not all of them do but some. When these guys realize that the fair tax would create wealth that they need to sell their houses they'll get on board.

C. H&R Blockdom. The corner tax refund specialist. Nice guys. They make a fortune "loaning" you your own tax refund at exhorbidant interest rates.

D. K Street lawyers and their firms. These guys have lush, paneled offices all over D.C. where they ply their trades involving getting money from some interest and passing it on to congress to screw you and me in order to benefit some high dollar client.

I could go on and on. Which are you xdromedary?

40 posted on 05/05/2006 5:52:50 PM PDT by groanup (Shred for Ian)
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