The Rally Was a Tremendous Success! Whew! (FairTax)

Nealz Nuze ^ | May 16, 2007 | Neal Boortz

[SittinYonder]

THE RALLY WAS A TREMENDOUS SUCCESS! WHEW!

FairTax Rally Gallery Well .. you came, didn't you? Thousands of you! What a tremendous night it was last night at the Carolina Coliseum. We had about 10,000 seats curtained off, and as I looked around I don't think there were 1000 empty seats ... all of them up near the rafters. So I'll estimate the crowd at between 8,500 and 9,000. What a night! Music from Banks and Shane and the Swinging Medallions ... and appearances by Governor Mike Huckabee, Congressman Duncan Hunter, Sean Hannity and John Stossel.

The really amazing part of the rally was when we all left the coliseum with thousands of FairTax signs to march around the Koger Center .. the site of the debate. Everyone was orderly --- but if you'll look at our picture galleries you'll find that we pretty much had all of the territory covered with FairTax supporters.

Several anecdotes of encounters with the staff of presidential candidates are starting to filter through. Some McCain staffers questioned some FairTax supporters about how they got there, thinking that they had been bussed in. They seemed impressed that most of the people there had driven to Columbia on their own.

There is no doubt that this rally last night had an effect. The crowd was so large that it cannot be ignored. The two big presences in Columbia last night were the presidential candidates and the FairTax.

Thanks so much for the sacrifice you made to get there. Now it's on to Ames, Iowa for a rally on the eve of the Iowa Caucus!

[Your Nightmare]

You’re telling me it’s more difficult to calculate the nrst inclusive rate than it is to calculate the exlusive nrst.

P x Ti / (1 - Ti)

is obviously more difficult than

P x Te

I’ve shown 3 times how easy it is and all you do is say I’m doing it the easy way. LOL.

And each time you've left out a step and have shown a simplified calculation. At this point I can't believe that this is anything but an intentional attempt to mislead people.

Again, if you really want to make it simple - use the tax exclusive rate.

[The Pack Knight]

I’m aware. While I do like his show, I’ve caught him in more than one error. My primary source on the FairTax is FairTax.org itself. If I’m unsure of something, I look at the actual text of H.R. 25 rather than even their “Plain English Summary” of it.

[Your Nightmare]

new price using inclusive rate: 132.47*(1+23/77)=172.04

Again, you are not showing all the calculations. Why? This is actually:

132.47*(1+23/(100-23))=172.04

No one in their right mind (I guess the typical FairTaxer qualifies) could think this is easier than:

$132.47*.2987=$172.04

One doesn't need to change from one to another...unless you want to be able to compare today's inclusive rates (income tax rates are inclusive) to an exclusive rate. Why you'd want to do that is a mystery. If you want to compare today's income tax rates - which are inclusive - to some other taxing method (nrst), wouldn't you choose to use the inclusive rate?!

This is the crux of the FairTax "Inclusive Rate" lie. They say it's to allow an apples to apples comparison with the current system, but this is complete BS because a comparison can't be made between the two based on their rates because their bases are different!!

How does a 23% NRST rate compare to a 28% income tax rate? Is it more? Less? The same? It partly depends on how you define their bases. What's a retail sale? What's income? What about the "prebate"? Taxable income deductions? These are also statutory and marginal rates. You would need effective rates to even begin to make an accurate comparison. Comparing the numbers of the statutory marginal rates is meaningless.

(It's also BS because a significant portion of the taxes the FairTax would replace are currently expressed as exclusive rates, e.g., employer portion of OASDI/HI, gift tax. I guess we aren't suppose to make an apple to apple comparison of the FairTax rate to those.)

[The Pack Knight]

The purpose of an inclusive rate is to allow a direct comparison with current income tax rates, with rates quoted for various flat tax proposals, and with embedded taxes. All of these are calculated inclusively, so if we're "misleading people", we're only doing what advocates of the Flat Tax and other income taxes are doing.

A side benefit is that, when a price tag reads, say, $19.95, then you can know that you can give them a $20 bill and get 5 cents back, and not have it be some mystery what you'll actually be paying at the register. It's not an attempt to hide the tax. If you want to know what the tax is, it'll be a separate line item on the receipt (by law), and perhaps even on the price tag.

[The Pack Knight]

The people at FairTax give examples of exactly what you’d pay given a certain retail expenditure and a specific household. There’s no misleading here. FairTax also openly states that their plan is designed to be revenue neutral. It is not a tax cut. The average taxpayer is going to be paying the same in federal taxes they are now. FairTax makes no secret of that.

[The Pack Knight]

And this idea that the tax-inclusive rate is a "lie" is ridiculous. We tell you exactly how we're computing the rate. We give you all the information. You don't like how we compute the tax rate? Fine. Compute it exclusively and then compare it to other taxes. We've given you the tools to do so.

What's your real problem with the FairTax anyway? It can't possibly be the inclusive rate calculation, which has no real effect on the substance of the proposal. If we calculated it exclusively, it'd be exactly the same tax, and you'd probably find some other problem with it.

Most of us who prefer the FairTax to the flat tax believe that a tax on consumption is more efficient, more just, and better for the economy in the long run than a tax on income. As it happens, a whole lot of economists agree with us. How about arguing the real differences between the Flat Tax and the FairTax?

[Mr. K]

Finally, at least an intelligent response, but you miss the point of my argument. (but thanks for being nice in your reply)

Using your example:

Each Taxpayer bought $90 worth of goods and the government got $10 in tax from the original $100 earned.

What is the TAX RATE for both examples?

quick, its not so easy to do in your head. My main objection to tax-inclusive rate is that (since it is paid at the cash register) it should be specified the same way as other sales tax.(tax exclusive)

OK my main 2 objections- the rate they like to use is deceptively lower.

for example my local sales tax is 8%. So if somethig costs $100 I know what the final cost will be with the TAX ADDED. $108. Easy to do in my head.

But with the tax inclusive rate (lets say 8% again) I can't even tell you off the top of my head what the final price will be without using a calculator, but it is closer to 109.

This looks like a 9% rate to me. It is even worse with the 17% tax-inclusive rate fair tax people want to use. I think I caluclates once that the final price for somthing that cost $100 would NOT be 117 but closer to 122. This means the rate is closer to 22%. (the figures are not exact, I had to use a calculator to figure it out last time and I am too busy now- once again demonstrating it is hard to calculate in your head)

Last, I would rather ALL taxes be specified in the rate that looks the HIGHEST so that people fear how much they are being screwed. 17% (or 22%) is RIDICULOUS. The govt should ask for only 10% just like the church- and LEARN TO LIVE WITHIN ITS MEANS.

[Mr. K]

Finally, at least an intelligent response, but you miss the point of my argument. (but thanks for being nice in your reply)

Using your example:

Each Taxpayer bought $90 worth of goods and the government got $10 in tax from the original $100 earned.

What is the TAX RATE for both examples?

quick, its not so easy to do in your head. My main objection to tax-inclusive rate is that (since it is paid at the cash register) it should be specified the same way as other sales tax.(tax exclusive)

OK my main 2 objections- the rate they like to use is deceptively lower.

for example my local sales tax is 8%. So if somethig costs $100 I know what the final cost will be with the TAX ADDED. $108. Easy to do in my head.

But with the tax inclusive rate (lets say 8% again) I can't even tell you off the top of my head what the final price will be without using a calculator, but it is closer to 109.

This looks like a 9% rate to me. It is even worse with the 17% tax-inclusive rate fair tax people want to use. I think I caluclates once that the final price for somthing that cost $100 would NOT be 117 but closer to 122. This means the rate is closer to 22%. (the figures are not exact, I had to use a calculator to figure it out last time and I am too busy now- once again demonstrating it is hard to calculate in your head)

Last, I would rather ALL taxes be specified in the rate that looks the HIGHEST so that people fear how much they are being screwed. 17% (or 22%) is RIDICULOUS. The govt should ask for only 10% just like the church- and LEARN TO LIVE WITHIN ITS MEANS.

[Mr. K]

oh- and one more thing... why does everyone on the FAIR TAX side always insist on using the tax-inclusive rate?

Let’s just calculate it like ALL OTHER taxes collected at the cash register, and move onto areguments about its relative merits????

Why do we have to constantly have this same discussion. You can at least admint the tax inclusive rate is harder to caclucate in your head, can’t you? And also that it appears to be a lower rate that way, correct? Then why insist on it?

If we could get past that then we could discuss more substantive things.

[Principled]

So much lying.

Are ee payroll taxes inclusive?
Are er payroll taxes exclusive?
both?
why you hidin’ yn? Go back to another website you’re paid to troll... this one’s too much for you.

[Principled]

If you want to know what the tax is, it'll be a separate line item on the receipt (by law), and perhaps even on the price tag.

Makes it pretty easy to calculate or "guesstimate" when it's printout out huh? LOL!

[Principled]

What's your real problem with the FairTax anyway?

My guess is he's paid to tear down anything that competes w/ the flat income tax. Just a hunch.

[Your Nightmare]

The purpose of an inclusive rate is to allow a direct comparison with current income tax rates,

OK. Show me a comparison between the the 23% FairTax rate and the current income tax rates. I'd like to see how it's done.

All of these are calculated inclusively, so if we're "misleading people", we're only doing what advocates of the Flat Tax and other income taxes are doing.

They are quoted inclusively because the bases they are taxing include the tax. This isn't so with a sales tax.

A side benefit is that, when a price tag reads, say, $19.95, then you can know that you can give them a $20 bill and get 5 cents back, and not have it be some mystery what you'll actually be paying at the register.

First, there is no requirement in the bill that prices be listed inclusive of the FairTax. Second, what about state sales taxes? Are they included in this $19.95 or they in addition to it?

It's not an attempt to hide the tax.

It is most certainly an attempt to gain acceptance of the FairTax idea by making the rate seem lower than it is. There is no other possible explanation.

If you want to know what the tax is, it'll be a separate line item on the receipt (by law), and perhaps even on the price tag.

Yes, let's take a look at a receipt with the HR 25 requirements:

Bob's Widgets Reg # 87654321 5/20/2007
	2	small widgets @ $1.27/ea	$2.54
	1	medium widget @ $1.83/ea	$1.83
	4	large widgets @ $2.17/ea	$8.68
	Subtotal		$13.05
	FairTax @ 23%		$3.89
	Subtotal w/ FairTax		$16.94
	State/Local Sales Tax @ 8.25%		$1.07
	Grand Total		$18.01

Thanks for making things so clear.

Let take a closer look. The bill requires "the property or services price exclusive of tax." OK, that makes sense. We need to know what are paying sans tax. It also requires the amount of FairTax paid and the rate. OK, I'm paying $3.89 in FairTax and that's 23% of ... well, what is it 23% of? Hell if I know. OK, good. The bill also requires that "the property or service price inclusive of tax" be listed - we'll let the computer figure that one. So it's 23% of the tax inclusive price. I'm done. No, wait. That's not the tax inclusive price. I haven't paid my state & local sales taxes yet. OK, they are 8.25% here were I'm at, so it 8.25% on (or is it of?) $13.05 (or is it of/on $16.94, or is it of/on $18.01). That's $1.07, I think... for a total of $18.01

So I paid FairTax that was 23% of the price. Wait, no it wasn't. It's was 21.589% of the price. What the hell?!?! And my total tax rate was 23% + 8.25%, or 31.25% - no that's not right - what was my total tax rate? Awww, screw it. Thanks a hell of a lot for making things clear.

Of course, this could be:

Bob's Widgets Reg # 87654321 5/20/2007
	2	small widgets @ $1.27/ea	$2.54
	1	medium widget @ $1.83/ea	$1.83
	4	large widgets @ $2.17/ea	$8.68
	Subtotal		$13.05
	FairTax @ 29.87%		$3.89
	State/Local Sales Tax @ 8.25%		$1.07
	Grand Total		$18.01

I paid 29.87% FairTax and 8.25% state/local sales tax (a total of 38.12%) on the price excluding tax. Clean. Simple. Easy.

It's not by chance that this is the way it's done with sales taxes across the country. No where is a sales tax expressed in inclusive terms. There is no good reason to do so and lots of good reason not to. The only comprehensible reason to express the rate this way is to confuse people.

[Your Nightmare]

Are ee payroll taxes inclusive?

Yes. The base includes the tax.

Are er payroll taxes exclusive?

Yes. The base does not include (i.e., excludes) the tax. The tax on employer is technically an excise tax (check the code).

both?

Both what?

why you hidin’ yn?

Nothing. Why do you ask?

Go back to another website you’re paid to troll... this one’s too much for you.

I'm not paid by anyone to troll any site for any reason. Why don't you take your ad hominems to another website?

[MrB]

I'm convinced that the FairTax is the best tax reform proposal out there.

And so are several leaders of other countries, knowing that the first country to enact this will become a tax haven for business and manufacturing.

[MrB]

Two things they can monkey with in the FairTax:

The “poverty level” which determines the prebate that EVERYONE gets.

The percentage of tax on new items - which would be transparent and likely to induce outrage if raised, unlike the taxes where it’s taken out before you even see it (withholding).

[Principled]

Both what?

indeed yn, indeed.

[Principled]

I'm not paid by anyone to troll any site for any reason.

Are you paid to monitor, reveiw, track, or inspect in any way websites for any reason?

[Your Nightmare]

Both what? indeed yn, indeed.

You really have a penchant for petty little games? Why don't you just answer the question?

[I also notice you ignored the rest of my post. Maybe that's why you play the kiddie games - to avoid other issues.]

[Your Nightmare]

Are you paid to monitor, reveiw, track, or inspect in any way websites for any reason?

I have stated repeatedly that my job has absolutely nothing to do with taxes (except that I pay them) or politics or lobbying or anything of the sort. Beyond saying I'm not paid to post here (or anywhere else) or to support/fight this (or any) cause, it's none of your business what I'm paid for. Thank you for butting out of my business.