Posted on 12/24/2007 7:55:05 AM PST by Alex Murphy
WASHINGTON — Mike Huckabee, one of the most conservative Republicans in the 2008 presidential race, has embraced one of the most radical ideas on the campaign trail: a plan to abolish all federal income and payroll taxes and replace them with a single 23% national sales tax.
The idea -- dubbed the "fair tax" by proponents -- has been a political asset for Huckabee; its well-organized backers have helped catapult him from the back of the presidential pack to its top tier.
Sales tax proponents have tapped into seething voter hostility toward the Internal Revenue Service to become a below-the-radar political force, popping up at campaign events and candidate forums in Iowa and elsewhere.
The efforts on Huckabee's behalf by sales tax advocates helped spur his surprise second-place showing in an August Iowa straw poll -- the breakthrough that marked the beginning of his rise in the state and nationwide.
He is the only major presidential candidate to make the idea central to his campaign. "The first thing I'd love to do as president: Put a 'going out of business' sign on the Internal Revenue Service," he said at one debate.
Some wonder, however, whether his embrace of the plan eventually could turn into a liability.
The sales tax proposal has been around for years but languished on the fringes of practical politics and policy. Tax professionals generally regard the idea as impractical, regressive and even "crackpot," as one critic puts it.
It has gone nowhere in Congress. The 2005 Presidential Advisory Panel on Federal Tax Reform soundly rejected the idea. And many politicians shy away from it because it is easy for opponents to portray it as a huge tax increase -- as Democrats did in a 2006 Senate race in South Carolina.
(Excerpt) Read more at latimes.com ...
I’d think that you probably missed some of these and instead included the funds in your taxable income (the part spent for taxable consumption).
Among the things not taxed under the FairTax are:
1) annual amount paid out for loan payments, including both principal and interest. (include existing mortgage, auto, and all other loan payments.)
2) annual tuition payments made for education for any age, any level. Include annual student loan payments
3) annual amount of all funds deposited to any savings account or retirement account through a government plan, through your employer, or privately, and all funds used to purchase any stocks, bonds, business, or investment vehicle of any kind.
4) annual amount of all funds you have donated to any Church, profit or non profit charity or organization, or given to any individual through a gift, inheritance, donation, or court order, including child support.
5) estimated annual amount of all taxes paid to any State, County, City, Municipal, Township, and other local governments. Include state income and sales taxes, property taxes, school district taxes, deed transfer taxes, occupational taxes. Include both State and Local taxes paid throughout the year, through payroll deductions and estimate those paid on your own, such as sales taxes.
6) annual estimate of funds spent on purchases of used items (jewelry, clothes, used real estate, used cars, used furniture, antiques, etc.).
7) donations as a political contribution to an individual or political party
Actually, I may have left a few things out, but if you’re being honest with yourself I suspect you’d admit that you missed a few things in the above list - all of which go to reduce your taxable income (and thereby lower your effective tax rate under the FairTax).
Also, don’t forget the offset caused by the prebate as well as the increased purchasing power which - per the “anti” forces is 9% or more.
Perhaps you should revisit your assessment. Here’s a good calculator to use:
Only consumption is taxed - and not all of that even ... and not all of your income is spent for consumption since many non-consumption items are not taxed.
You should read the bill - or use the FairTax calculator from the Pennsylvania FairTax group which outlines many of the things not taxed.
You pay 6.2% on the first 7,000 on each employee for the UI.It sounds like you're being penalized for having unemployment claims. That isn't (legally) deducted from the employee's paycheck (as you claimed) and the Fairtax doesn't eliminate it. It in fact would probably tax it...
The the deduction from the employee's paycheck for FICA is 7.65%, the employer half is also 7.65% (that totals 15.3% BTW) If you're going to say the employee pays 15.3% then, to be honest, you'd have to add the employer half to the employee's gross.anyone who works for me is getting hosed at about 40%
No doubt.
Since I was in a 40% tax bracket for most of the time I was able to save anything now I get to pay another 23% when I spend it. That's a swell idea, oh yeah, I'm really ready to do that. Apparently I was a freaking idiot and should have gone on vacations, etc. and not bothered to save a penny since some want to take yet another big honking chuck of it.
And then there's the joke for those of us who hold Muni bonds. Talk about a load of baloney. Sure, you can get an expert to say just about anything, but the experts that have addressed that probably have never had a penny to invest, have worked for the goobermint or what passes for an establishment of "higher" education.
Those are two of the three very, very large holes in the "fair tax" canard.
The third? No limit on spending, no limit on the percentage that the tax can be jacked up to. Without limits the goobermint will continue to screw us, it'll just pick another position.
People that don't understand the concept of "double taxation" - taxing heavily first on income, and then when one goes to purchase something, paying a 23% new Federal sales tax - frost me.
This is just the kind of simplistic, not fully-thinking-out-the-situation attitude that ticks me off about the FairTaxers. And I'm a long way away from retirement.
I don’t much care for Huckabee, but would probably vote for him if nominated, for this issue alone.
Removing the income tax would take a huge burden off the economy.
Having invested all this “study time” I can fairly say that neither you nor some of your locked-in anti FairTax posters have anything that can remotely be called “civil and fun”.
Instead I’ve noted almost unremitting falsehoods, misstatements, and attempts to insult and drive away those who favor the FairTax by calling them liars and misrepresenting what they say - or what the FairTax organization or the FairTax bill itself says.
So don’t tell me you’re “fun and civil” - nothing could be further from the examples I’ve seen over the last year or two. If you wish to say you oppose the FairTax - fine - just stop doing it with such blatant dishonestly.
My claim is that the combination [any combination] of pre-nrst price reductions combined with wage increases and lower effective rates will result in a net zero change in purchasing power. That's what Jorgenson said BTW.Unless you can show something to the contrary, his producer (not retail) price reductions were from a combination of things, one of which was reduced gross wages, not increased wages....
That is what Jorgenson said.
BTW, your "claim" would not be revenue neutral.
It's interesting how you went from 22% embedded "tax costs" to 9% practically at the flick of a switch.
The “embedded tax costs” YOU refer to are the sum of any wages changes and price changes. Jorgenson said the sum is 22%.
The 9% is the amount of business taxes in retail prices.
You should be censored and banned for your hatred and bigotry, you know. Fair Taxers have the ONLY TRUE TAX!
Then you guys would also have to agree that the entire treasury bill market is a fraud. Right?
You are already paying it. Approximately 22% of everything you purchase is the tax paid at the various levels of production that are passed on to the consumer in the cost of the product. The FairTax eliminates all those different taxes, and replaces them with one national 23% sales tax. PLUS, you get a prebate check for the amount of taxes expected to be paid by a family at a poverty level income.
“So kindly tell me what “services” I get from government(1)? Don’t even bother bringing up Social Security b/c I’ve been paying into it since 1955 and if the government wants to reimburse (2) all my contributions PLUS COMPOUND INTEREST, that’s fine by me. They can also quit taxing me on my interest income and I’ll do just fine (5). Don’t bring up Medicare either because between my Medicare premiums, my supplemental policy to cover the 20% Medicare doesn’t pay (3), and my Part D drug benefit, I’m paying over $350.00 a month for health insurance. That’s more than I paid when I was working full time(4).”
1. The United States Marine Corps for one.
2. SS is not a savings program. You did not PAY INTO IT. You paid for other people’s current consumption, at that time, not your future consumption. I am not retired and consequently paying YOUR SS benefit NOW, so show some respect.
3. Medicare is relatively cheap health insurance for the beneficiary. It is one of those insurances where the beneficiary is not the payee. I am working and paying for your medicare NOW, also. Not 100% but I pay something and get none of the benefit. And i do not want to hear about subsidized flood insurance. I’m opposed to that also.
4. No, when you were working insurance for you COST more than $350/month.
5. There are tax free interest investments. I’m opposed to all tax on interest and capital gains. ALL.
I still say the only tax should be a simple division of the cost of government equally allocated to each citizen - and paid by check. When you die you escape paying.
Elabourate, please.
To me the two keys to Fair Tax that make it worth doing despite all other problems is that EVERYBODY has to pay and there is no tax on investment gains and interest.
IOW you gain less by this sort of evasion under the FairTax and, in fact, your chances of being detected will have actually increased due to the reporting system in collecting and forwarding the FairTax.
So you think a lowered gain with a greater risk is a “good deal”??? Hmmmm!!!
Merry Christmas to you too.
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