This is where we fundamentally disagree. Sales tax is not hidden. I notice my 7% sales tax each and every time I pay for something, especially big ticket items.
I very much believe that a person that gets a $300 TV and has to shell out $323, or pay an extra $46,000 for a house, will be inclined to want to limit spending and reduce taxes.
If you don't think people will respond to any level of direct and open taxation, then you might as well give up on everything right now.
45 states have a sales tax. If a sales tax is such a great idea, why not adopt one of the 45 plans we know works and run with it?
As do thousands of municipalities. These are all flat taxes and work very well. There is also stiff resistance to even small increases. The existing sales tax plans show how well it works. I live in Florida, where we have no income tax and yet collect revenue just fine. Compare our economy to the North East where they have heavy and graduated state income taxes. So, OK, I'll take the Florida plan as a national model.
Frankly you don't know enough about what it is to know that.
Sure I do. Compare our Florida sales tax enforcement to the national income tax enforcement. Much lower per citizen, and everything else is equal.
But, the Fairtax would be administered by 50 different states with 50 different interpretations on day one. BTW, at what point does a state worker become a federal agent and then back again...What bureaucracy cuts his/her check?
I pay a city, county, and state sales tax right now. All of your above concerns apply, yet the problems don't exist.
AFT says the Fairtax would reduce interest rates 25% (that's huge)...hardly a cause to go running to the bank with all that extra cash to open a savings account.
I don't accept that percentage (what is the causal reason?), but let's run with it. If I invest $100 at 5% now and pay 25% tax on the interest, I get $4. If I invest at 25% less return (4%) I get $4. The question is do I run out and spend my $4 or do I save it and let it compound? As my savings are not taxed, but my purchases are, the incentive is to save.
I'm opposed to it because of the lies, misinformation and speculative talk as if it's all matter of fact (like you're doing here)
I love it when people call me a lier because they can't form an effective argument and/or don't wish to think about what I have to say. I would suggest you withhold such spacious attacks on my character, unless you can prove that I am misrepresenting what I know to be wrong, and now just disagreeing with you. As for all of the arguments being made in favor of it, I only feel obliged to take ownership of what I myself have asserted. I don't recall magically applying ownership of someone else's arguments to you. Reciprocity would be appreciated.
Like I said, pick any one of 45 successful sales tax plans and run with it.
Not sure whether you're being serious or not, but I'm fine with Florida's plan. Flat is fair, and only a consumption tax will result in a flat tax.
I very much believe that a person that gets a $300 TV and has to shell out $323,Well sorry to burst your bubble but you've been lied to and you fell for it.
The tax is 23% OF the gross payment not 23% ON the price.
A 300.00 TV would be $390.00 and your $200,000 house would be $260,000...$90 is 23% of $390(gross payment) and $60,000 is 23% of $260,000 (gross payment
Here's how it would be
Ya see after the first year Social Securiy bureaucrats would determine the sales tax rate for "the combined rate"...you know, to save Social Security.
Here's a sale the first year.
$100.00 +
State tax 7%=
$107 + Fairtax 30% =
$139.00 (gross payment)
$139 (gross payment) X .23(fairtax) = $32 federal tax
Does $32 tax on a $100 purchase sound like 23% to you?...See FAQ #47 at AFT if you don't believe the 30% rate and I posted the legislation confirming the tax "OF the gross payment".
Thr rate is just the beginning of the lies. AFT wrote an essay to explain it rather than quote a real sales tax rate.
BTW, the rate isn't "so folks can compare". It's written for the business that pays the tax.
Mr. Business just add up you gross receipts, send 23%.
In order for the business to not lose money he has to charge 30% tax.