Posted on 08/28/2007 4:39:18 PM PDT by Bigun
The People Must Demand The Fair Tax
By Doug Patton
August 28, 2007
Last year, during the United States Senate race in Nebraska, Republican challenger Pete Ricketts suggested that every option must be considered when looking at ways to reform our federal tax system. Among the list of alternatives Ricketts said should be on the table was a national sales tax known simply as the "Fair Tax."
The Democrat incumbent, U.S. Sen. Ben Nelson, launched an attack on his opponent that was, at best, distorted and condescending, at worst, irrational demagoguery. One would have thought that Ricketts had suggested stealing all the assets of the poor and handing them over to Warren Buffet and Bill Gates.
Recently, the panel of pundits on ABC's "This Week with George Stephanopoulos," discussing the apparent rise in popularity of former Arkansas Governor Mike Huckabee's presidential campaign message, scoffed at Huckabee's unabashed promotion of the Fair Tax.
George Will, the token "conservative" on the panel, brushed it aside with the disbelief of an elitist who cannot understand the burden of the average worker who would love to take home his or her entire paycheck, as the Fair Tax would allow him or her to do. Will opined that Huckabee's second place showing in the Iowa straw poll was even more amazing given the fact that "he supported a national sales tax of thirty percent, which means that if you buy a one million dollar house, you'll be writing a check to the government for three hundred thousand dollars." Of course, the others on the panel readily agreed.
The elites of this country, who buy those million-dollar homes, are not enamored with the Fair Tax. They would be if they took the time to understand its appeal.
The Fair Tax would replace all federal income taxes. No more federal withholding. No more Social Security withholding. No more Medicare withholding. No more stealing from the paychecks of American workers before they even see it and then pretending to give them a refund, without interest, at the end of the year. No more saving receipts for tax deductions. No more IRS audits. No more April 15th.
Instead, the Fair Tax would put us in control. All consumer items would be taxed. Business purchases would not. By allowing us to make the determination about what we buy and when we buy it, the ability of our legislators to manipulate our behavior is eliminated. That is why the elites don't like it. They can't control the public's spending habits under such a system.
The current federal tax system is broken. It cannot be fixed. Since the inception of the federal income tax with the passage of the 16th Amendment in 1913, federal corruption and control have turned it into a Frankenstein monster that torments the people and serves the special interests. A tax on a person's income is a tax on production, and as Ronald Reagan once said, "Whatever you tax, you get less of."
Because the poor are forced to spend a disproportionate percentage of their resources to cover the tax on necessities, the Fair Tax hits them the hardest. That issue can be addressed by simply issuing a "prebate" check each month to every household in the country. Unlike disingenuous tax credits, deductions, exemptions and other loopholes in the current income tax code, a prebate check is a clean, honest method of covering the sales tax on food, clothing and shelter - up to the poverty level.
Of course, removing the income tax on corporations will reduce the cost of everything we buy, since corporations don't pay taxes. They simply pass them along to consumers. The Fair Tax plan calculates that removing the corporate income tax will result in a reduction in the cost of virtually every consumer item on the market. In fact, it will just about offset the tax on those products. Imagine paying the same price for something but having your entire paycheck to buy it.
And then there are the billions of dollars that flow untaxed through our economy today: drug dealers, prostitutes, pornographers, foreign tourists. Imagine how much revenue could be raised simply by taxing the things those people consume.
There would be no more audits, no more justifying deductions, and April 15th would become just another spring day. But only if the people stand up to the elites and demand it.
Of all the economists both pro and con weighing in on the FairTax, none have shown it to be inflationary. But YOU have? Just by saying:
And any plan that has prices rise 20-30% or more in real terms is inflationary.
Sorry Rob. The definition of inflation is just out of your reach. Actually, since I have explained it to you and you still don't understand (or are parroting your talking points) it is way our of your reach.
A unit of Money-- a dollar-- is worth less after than it was before.
Let's do the math, shall we?
You make 100,000 a year.
You pay taxes of 25,000 a year.
You have 75,000 to spend on life's piles of goodies.
Under the FairTax you make 100,000 a year.
If you spend it all you'll pay appx. 25,000 (minus prebate) in taxes.
Remember?
So, once again you have about 75,000 to spend.
Where is the loss of purchasing power? Where is the inflation?
Not everyone is a wage earner, and not everyone will see an increase in take-home pay. And not every dollar is earned after the FairTax is implemented, many are already in the system in an after-tax account. And there are also many fixed dollar debts like mortgages that would be paid off with more plentiful and less valuable “after” dollars.
Works the same for a lawyer billing by the hour or a private plumber.
...many are already in the system in an after-tax account.
Bringing this up again? Talking points? As I have said many times maybe that should be addressed in the work up of the legislation. Although certain advantages will be enjoyed by those folks too.
And there are also many fixed dollar debts like mortgages that would be paid off with more plentiful and less valuable “after” dollars.
Huh? Begging your pardon but you are not sticking to the script. Remember, in your world there will be fewer dollars with which to pay off anything.
We're talking about the FairTax world, and in that world the assertion is that almost everyone will be walking around with 20-25% more dollars.
Sorry, I was a bit unclear. The prebates represent a cost to implement and operate the system, when I don’t see the need for monthly checks to taxpayers. Maybe this is a part of the proposal that could be amended to pick up additional support for plan, or maybe I’m being unrealistic in that support would be eroded by amending the proposal to eliminate prebates? Anyway, many will disagree with prebates as it is a move to a higher degree of socialism in government and has an unnecessary overhead cost to issue them.
From the Fair Tax site FAQ #4
“The purchase of food, clothing, and medical services is made from after-income-tax and after-payroll-tax dollars, while their purchase price hides the cost of corporate taxes and private sector compliance costs.”
Under Fair Tax, the prices for food, clothing, and medical expenses would be less due to elimination of corporate taxes, and therefore doesn’t matter if they were exempt or not. Additionally, to use the system of prebates could cost more than it would to just forego collecting any taxes on these items.
From the Fair Tax site FAQ #4
“Finally, exempting one product or service, but not another, opens the door to the army of lobbyists and special interest groups that plague and distort our taxation system today.”
Lobbyists will still be there without or without Fair Tax or any other reform for that matter.
And there are also many fixed dollar debts like mortgages that would be paid off with more plentiful and less valuable “after” dollars.
What do YOU think the orginal limits were?
That’s who I was thinking of.
Of gosh - I'm cut to the quick - not.
Manipulative liars disgust me.
Why in the world would you need a computer to calculate something as simple as what you claim the FairTax to be?
My first job, back in the dark ages, was in retail. No computers to automatically figure and add the sales tax, or change due the customer. Somehow, we muddled through just fine.
Not to mention the immutable FairTax bill.
The inflation is in the price increase that results in $75,000 buying fewer of life's goddies.
You know that the present Income tax is the tool of choice for Socialists today. Their number one objection and scare tactic is to claim that a national sales tax will tax the poor disproportionately. Think about that.
Furthermore, in American history pre-Income tax, the same complaints were made about the excise taxes of that era.
The choice comes down to this offering to the American people:
Behind Door 1 is the requirement for all households to file a federal income tax return under threat of criminal prosecution and imprisonment.
Behind Door 2 is an offering for all households to register with the federal government for the purpose of receiving a check.
I don’t think it’s too hard to guess what people would prefer.
Behind Door 1 lies a system where the federal government confiscates revenue from households and doles it out to entities on their list of favorites.
Behind Door 2 lies a system where households regardless of financial position are given a check of the same amount to offset consumption taxes below the poverty level.
So the argument that the FairTax is more socialist than the Income tax is specious.
As to your second comment regarding lobbyists and exemptions, yes lobbyists will be there initially in failed attempts to reimpose the Income tax. But repeal of the 16th Amendment will leave them with no place to go. But lobbyists that are seeking government contracts for whatever purpose (health, military, etc.) will be forever camped out on the banks of the Potomac. But the ability of members of Congress to trade favors for tax votes will be squelched.
To recap on the rebate, the FairTax rebate is a small price to pay to rid the country of the monstrous tax code that presently exists. The rebate is fair to all and is not subject to special favors or abuse. The rebate will not be manipulated because it is linked to a stable and well accepted method of determination of the poverty level by DHHS.
Most understand that computers today record auditable transactions. Bank deposits are easily compared with auditable data for enforcement purposes.
Large amd medium level retailers conduct the bulk of their business electronically. Smaller businesses can still be audited by hand but the larger and mid-level retailers must be in compliance else the system breaks down.
In the past before the telecommunications revolution an audit of large retailer transactions would have expended too many resources.
I really don’t want you posting to me as you have gone over the top in your insinuations of my statements. I find them very disturbing. Ask others these questions as I don’t want to be reminded of your previous posts. Your questions are sophomoric in nature and can be handled by any number of posters on these threads. Besides everyone knows your questions are not questions per se, they are sniping comments packaged in questions.
Proving again that “liars figure”
...that would in truth be “stagflation” aka the Carter Administration.
Illustrate this mathematically please.
Everyone is eligible. There is no determination. It is based on family size.
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