The People Must Demand The Fair Tax

GOPUSA ^ | August 28, 2007 | By Doug Patton

[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.

[lewislynn]

A creative Realtor will advertize the house as- "Big nice house 1,298,700- we pay the tax!"

`SEC. 510. TAX TO BE SEPARATELY STATED AND CHARGED.

`(a) In General- For each purchase of taxable property or services for which a tax is imposed by section 101, the seller shall charge the tax imposed by section 101 separately from the purchase. For purchase of taxable property or services for which a tax is imposed by section 101, the seller shall provide to the purchaser a receipt for each transaction that includes--

[groanup]

Beg your pardon. The article was by Bruce Bartlett, not Bill.

[Man50D]

I am all for it. I hope that the organizers of the Fair Tax hire media consultants to sell the idea to liberals not just Republicans and Libertarians.

The Americans For Fair Taxation have been targeting private citizens and politicians from all parties. It is not a party specific movement. I suggest you look at The Fair Tax Weekly Feature as an example.

[Your Nightmare]

The employer gets a tax break for the portion of health insurance he provides, and the employee does not pay tax on that portion of the benefit. Under the FairTax, would employer provided and paid for health insurance be a business expense and tax free, even though the benificary is the individual?

From FairTax.org:

"The purchase of insurance by a business for its employees is taxable. The business owes the tax."

So, yes, employers will pay the FairTax on their employee's health insurance..

Would the portion of insurance paid for by the employee be subject to the 30% tax?

Yes.

What happens when the insurance provider pays for health services? Is the payment a business expense and therefore not subject to the tax?

Yes. There is no tax charged. If the insured pays for the health service, they are charged the tax and they get a credit through the insurer.

[lewislynn]

It's just the tax is more visible

At the same time it's visible it's:

Increased take home pay.
Increased purchasing power.
Government checks in the mail every month.
More money for savings.
Reduced interest rates.
Easier to save for a new house.
All the while the government is still funded as usual without a hiccup.

Where's the visibility?

[Man50D]

I agree with your concerns - The government is going to determine eligibility for monthly prebate checks?

I have no concerns because those figures have already been calculated by the Department Of Health And Human Services. The table below is for the contiguous 48 states.



Otherwise, you’ll end up with a sales tax that only the rich pay, and probably a higher rate on them with paybacks to the “poor”.Talk about robbing peter to pay paul ...

Talk about completely misunderstanding The Fair Tax! The Fair Tax rate will be 23% for everyone! It is essentially a flat tax! You are ignoring one very salient point about The Fair Tax. People of all income levels will have the power to decide how many of their dollars they will pay in taxes because they will decide how much to spend!

Contrast that with the income tax. Those tax dollars are removed from a person's wages before they see their paycheck. The taxpayer has no choice or power! The "payback" as you refer to it is only to return taxes to people paid on necessities up to the cost of living. It is tantamount to a tax refund under the income tax.

The government already attempted a flat tax on income. It was enacted in 1913 with a two tiered tax rate system. The first tax ranged from merely 1% on the first $20,000 of taxable income and was only 7% on incomes above $500,000. In 1939, 26 years after the Sixteenth Amendment was adopted, only 5% of the population, counting both taxpayers and their dependents, was required to file returns. Today, more than 80% of the population is under the income tax. A flat income tax would eventually evolve into the same oppressive monstrosity we have currently.

[MissouriConservative]

Too bad the headline didn’t say “The people must demand the FLAT tax”. If former communist countries can implement it with no problem, why can’t the greatest economic power in the world do it?

[Man50D]

If former communist countries can implement it with no problem, why can’t the greatest economic power in the world do it?

The U.S. enacted a flat tax on income in 1913 and it has become a failure. Read the last paragragh in post #66.

[Mumbles]

" The Fair Tax Act requires the IRS to be abolished by defunding it per Title III Section 301. "

Do you honestly believe Congress, which continuously passes complex laws with loop holes for "contributors" (read bribers, conflict of interest etc) will do away with the legal profession's full employment guarantees? If the legal profession were about right and wrong and correcting injustice, it should be Socialized. However, the legal profession exists for one reason and that is BILLING (greed, graft, fees, contributions, honorariums or whatever you call it.) See item 5 below.
With respect to the "Fair Tax",

1. ... and the entity that ensures that the Fair Tax is collected and will be paid is called...?????

2. Congress passes the tax laws. IRS implements them. Will Congress be abolished?

3. IRS is a "straw man" for Congress to beat up as the "bad guy". Even when IRS is correct, Congress forces them to confess to errors or Congress keeps going etc.

4... and who enforces Title 26 with God only knows how many sections,and what will they be called? All the 'old" law violations will be thrown out?

5. Congress is almost entirely ALL lawyers. The more complex the law the more lawyers are needed. Dealing with IRS requires a Lawyer(s) or an Accountant. All tax appeals to tax court (more Lawyers posing as judges) require a Lawyer - ad nauseum.

I am sure there are a myriad of reasons the Fair Tax won't be passed, but no sense destroying the dream of many who appropriately hate making out ever more complex tax returns.

[Turret Gunner A20]

RE: # 7 My reasons are that they won’t tie the repeal of the 16th amendment to the implementation of the tax ....

See # 37 at:

http://www.fairtax.org/site/PageServer?pagename=about_faq

37. Could we end up with both the FairTax and an income tax?

No current supporter of the FairTax would support the FairTax unless the entire income tax is repealed. Moreover, concurrent with the repeal of the income tax, a constitutional amendment repealing the 16th Amendment and prohibiting an income tax will be pushed through Congress for ratification by the states (filed as HJR 16 in the 109th Congress).

[Turret Gunner A20]

RE: # 18

If you think this Fair Tax would remain fair with our corrupt politicians you haven’t learned much about our government.

And whose fault would that be? To give you a hint: who is responsible for some 98% of those corrupt politicians returning to congress every election?

Get the answer to that and you will have the solution to perfecting the FairTax and making it work like a charm.

Think on it.

[lucysmom]

Thanks, I appreciate your response.

While, business gets a tax break for providing insurance to it employees now, it would loose that tax advantage and, to use FairTax terminology, would be punished by the FairTax for providing that benefit.

[Turret Gunner A20]

RE: 2@

WRONG!!!

Please go to ....

www.fairtax.org/site/PageServer?pagename=about_faq

... and read the questions and answers carefullY -- WITH AN OPEN MIND.

[Turret Gunner A20]

RE: # 25

...if you make so much money that it puts you out of reach of any prebate, rebate, or whatever you want to call it ....

The only way you could reach that stage is to die.

The prebate is based on being family siee only -- EVERYONE with a valid social security number is eligible.

[CIDKauf]

Thank you for posting the thread, as I actually did read the Fair Tax information, believe it or not, and my concern is the government beuracracy that is required to accomplish monthly prebate checks along with what I percieve to be other problems.
How does the Fair Tax repeal an amendment to the Constitution? How does the Fair Tax deal with SCOTUS decisions such as Fleming v. Nestor (1960) or Helvering v. Davis (1937) or:
http://www.cato.org/pub_display.php?pub_id=5776
How does the Fair Tax deal with the $27 trillion dollar OASDI trust fund? Hey I am on your side about tax reform and dealing with SS reform, but I’m not sure this is the answer.

[CIDKauf]

I don’t either.

[Extremely Extreme Extremist]

Flat tax! Not Fairtax!

[CIDKauf]

So you’re saying that we will no longer have the IRS but we still have the Dept. of the Treasury and that we file income information only forms to simplify the massive processing in paperwork currently, and this is the bureaucracy that is in place? I’m not sure the savings would equal to the cost when you factor in the cost of issuing prebates. I know that almost any system is better than the one now, as the wealthiest people have lobbied so long they have the laws to avoid paying taxes that would be collected from them with a consumption tax.

[MissouriConservative]

To me that was not a flat tax. If there are more than one rate, then it’s not a true flat tax. I am speaking of one rate for all no matter the income level.

And I still prefer a true flat tax to the fair tax proposal.

[jwh_Denver]

Somebody can’t disagree with you without you asking a stupid question of them?