More than 8,000 people of every political persuasion recently came to the Carolina Coliseum to make a point.
Posted on 06/29/2007 5:17:36 PM PDT by Man50D
More than 8,000 people of every political persuasion recently came to the Carolina Coliseum to make a point.
They wanted America and every GOP presidential candidate at the debate to know that there is a better way to collect federal revenues for the common good.
It is called the FairTax, and it is an extensively researched proposal and legislation to replace the dysfunctional income tax system with a progressive national retail consumption tax.
The FairTax is gaining national attention and widespread grassroots support because, unlike every other tax debate over the past fifty years, it does not pit one income group or political view against another.
At the same time that all federal taxes on the poor are eliminated under the FairTax (through a universal rebate), capital gains taxes, corporate taxes, and “inheritance taxes” are eliminated as well as all payroll taxes and federal withholding. Elimination of federal withholding and payroll taxes means, of course, that every wage earner takes home their entire “gross” pay.
As well, the FairTax gives the middle class a tremendous tax improvement, reducing effective lifetime tax rates dramatically. Every income level can be benefited because the FairTax creates a far broader base for taxation consumption than the current ineffective, loophole-ridden, and costly system of taxation of earnings. The “underground” economy totaling trillions of dollars contributes to the federal government for the first time, and 12 to 20 million illegal immigrants become taxpayers as consumers.
There is a “catch,” however, and that is why so many people were inspired to travel to Columbia from all over the country for a Tuesday evening FairTax rally. The “catch” is that enactment of the FairTax eliminates Congress’s ability to grant favors in the income tax system. Taking power away from Congress is, of course, a huge political challenge requiring overwhelming grassroots pressure and an abiding belief that public policy can be made to simply favor the public, despite the self-interest of Congress.
While the FairTax has the potential to unite a divided country against the self-dealing of Congress, the growing popularity of the FairTax has also inspired bipartisan distortions of the proposal by Washington, D.C.-based political operatives threatened by the very idea of a tax system free from congressional mischief.
Most commonly, the proposal is derided from the left as being unfair to the poor despite the fact that, unlike every other sales tax, the FairTax is not regressive and actually untaxes the poor entirely. From the right (and sometimes the left), D.C. operatives like to claim that the FairTax represents a tax increase on everyday goods, conveniently ignoring the fact that every respected economist who has studied the FairTax has concluded that retail prices will actually drop as huge “embedded” income tax costs are eliminated from the cost of producing everything from a loaf of bread to a gallon of gasoline.
FairTaxers, passionate in their desire to see the broken income tax system jettisoned, take such criticism in stride as the cost of advancing an issue that did not start in Washington, D.C. They are less understanding of why national media sources have been so ill-tuned to the growing national movement that has won 60 congressional co-sponsors and at least one fervent presidential candidate (Mike Huckabee).
In the last 11 months, FairTax rallies in Columbia, Atlanta, and Orlando have seen thousands of citizens, bedecked in FairTax shirts and hats and waving placards, wildly cheer advocates like talk show host Neal Boortz, Fox News pundit Sean Hannity, and ABC News reporter John Stossel. But more than celebrating their celebrity, FairTax supporters have welcomed these men as fellow citizens embarked on a democratic journey to force the public will on a largely unresponsive representative government.
Even if the fact that the current income tax system is killing the “Made in America” label, from textiles in South Carolina to automobiles in Michigan to steel in Pennsylvania, and is driving trillions of American dollars offshore, Congress will only be moved on this issue by direct grassroots advocacy that threatens the tenure of elected officials. In this, the FairTax grassroots army largely sees our campaign as a test of whether our Founding Fathers’ promise of a government “of, by, and for the people…” can still be made to come true.
The irony that a nation first conceived in the midst of a tax protest should, hundreds of years later, have citizens struggling again to overturn a universally despised tax system primarily supported by tax lobbyists and elected representatives jealously guarding their own power to manipulate taxes has not been lost on the growing FairTax army. While sometimes indignant, increasingly this citizen army has simply adopted the attitude that “the world is what we make it.”
Our nation has wondered long enough about the complex and destructive patchwork quilt of political favors called the income tax system and asked “why?” It is high time, in Bobby Kennedy’s words, to instead ask “why not?” about a fairer, simpler, and more effective means of collecting federal taxes.
Purchase of an item for 100 dollars.
Under current tax law you have to earn 133.33 dollars in a 25% bracket to have $100 left over.
Under the proposed HR. 25 you have to earn $130 to make the same purchase. (100 x 1.3).
So already you are ahead.
Then adjust for price decreases of between 10 and 20 per cent, low compliance expense, the prebate and suddenly one is very much ahead of where he was under the IT.
And please notice that the supply and demand of money hasn't changed much at all. So despite what some FairTax deniers say we won't have instant inflation.
They’re all taxed on each individual company’s profits,So how does that equate to cascading?
Whatever one company passes to the next company, taxes, labor, etc. is deducted from the gross income to determine the taxable income...Where's the cascading/compounding?
There's no logic in your thinking.
For those keeping score, Dr. Dale Jorgenson, of Harvard, found in his study that retail prices would fall 22% after the abolition of the income tax and adoption of a consumption tax, assuming that all employees would keep their net, after tax income. Arduin, Laffer and Moore Economietrics, Inc. concluded that prices would fall 11.25%, assuming that all employees kept their gross before tax income.Really? paying taxes from what used to be aftertax income isn't losing? Do you every buy anything imported?The truth is it would probably fall somewhere between the two. It's hard to see the average American losing at either extreme.
Why do all of you Fairtaxers think everything is produced domestic?...There wouldn't be any price reductions on imports as a result of passing the Fairtax and frankly, other than wishful thinking at AFT, there's nothing anywhere that says there would be price reductions.assuming that all employees would keep their net, after tax income
So the 100% paycheck is a Fairtax lie.
Is Rodney Frelinghausen R-NJ, on board?
Under current tax law you have to earn 133.33 dollars in a 25% bracket to have $100 left over.Really? Do you pay taxes on your gross income?
Think about it in marginal terms.
Then, I used the "value added" method [not my method either] to show using this method, 3% is too low.
Then, I got you to admit that 3% of value added is indeed too low. Call it what you want, but you've changed from 3% to higher based on my showing your error in three different ways.
There are many different models to choose from to demonstrate the additive property of tax costs in prices - indeed I used two above to show your 3% is wrong no matter how you slice it.
a) 2.5% of 100
b) 2.5% of 500
Both are 2.5%, so according to your logic, a and b are equal.
Taxes are added at each stage of production even when the percent doesn't change. An illustration is above in a) and b).
I can't believe you deny this.
Wrong louis. Faulty logic.
Ever wonder why similar goods are priced similarly whether you find them at Macy's, Pennies, Sears, or Walmarts?
Ever wonder why similar 2x4 lumber is about the same price at either Home Depot or Lowes?
Ever wonder why similar gasoline costs about the same whether you're at Chevron or Shell?
Ever wonder why Kroger, Piggly Wiggly, et al have about the same prices for a gallon of milk or a carton of eggs?
It's because of price competition between similar goods. That's what AFreeBird was talking about.
Income tax alone? WHy is that relevant except as a part of the TOTAL tax costs as a % of sales?
SNicker... yeah 100-22 is 88 according to lewis - he based an entire week-long argument that the fair tax people were liars because the fair tax people said 100-22=78.... and lewis said 100-22=88. Pitiful.
Lewis, you don't even know what you're posting. You have no idea what that says. You do not have a fundamental grasp of basic math. You probably don't know the definition of average - quick! Look it up!
Define "cascading" for this context. That's what you wouldn't do before. Then after refusing, you complain about the example that was put up.
THis is what makes more sense to me. I don't think employees will accept a cut in contractual pay.
Wow, what a novel idea. Why don't you do that?
He hasn't gotten that far along yet. He's still quantifying the taxes per se in prices. As of last night, he said they were 3%. Then I "ran away"....
Lewis, even if a company deduct expenses from taxes, those expenses still must be paid via sales revenues...that is, the expenses are passed along in prices.
I guess math isn't your only weakness.
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