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 ...
“Mike Huckabee, one of the most conservative Republicans in the 2008 presidential race...”
That’s as far as I got.
If you do that - which is the true cost to you - the example has quite a different result as I showed you, reducing the $100 cost down to $85.56. You seem to not understand that ... or not wish to.
Huckabee supports the Fair Tax.
It is intended to replace the income tax. That is not in the title.
There are a number of good reasons to go to a consumption tax. There are also some downsides.
All in all, though, we must jettison this current income tax and it’s billions of lines of tax code. It is a fact that certified accountants and IRS experts filling out the same citizen’s return will all come up with a different answer.
I am a Thompson/Hunter 08 supporter. Thompson supports a 2 rate “flat tax.”
Excellent. I'm glad you've cleared up your confusion.
but if you have any sense you will so you can see how what the consumption is actually costing you - in the case you dreamed up, a reduction from $100 to $85.56.
Now you'll have to explain why my doctor would reduce the $100 he currently charges, just because the FairTax became law. Thanks.
If you could take less than the 100+ posts it took to get an answer on the last question, that'd be great.
No, because my original example was $100, before any tax was added. I'm glad you've overcome your fear.
You seem to not wish to know what the cost (as opposed to price at point of sale)
I was asking specifically about the price at point of sale.
Everyone who buys an item for $100 will see the exact same tax on their receipt. The receipts will not vary according to each persons different effective rate. How would the retailer know my effective rate?
You are clearly talking about a $100 purchase including the FairTax showing on the receipt. I have answered your question - the amount of the real cost to you would be $85.65 due to your effective tax rate.
The fact that you do not like my answer does not matter a bit - it's still the case and shows how the FairTax actually operates - like it or not.
I'm just happy to know that my current cost of $100 would rise to $130 under the FairTax. Thanks.
I already pay over 11% of my income in property taxes. I am retired on a fixed income. If I have to pay 23% on every purchase, will they freeze property taxes, and drop all Fed & state taxes on fuel???
With the price of gasoline, I only drove 3111 miles this past year.
I already pay over 11% of my income in property taxes. I am retired on a fixed income. If I have to pay 23% on every purchase, will they freeze property taxes, and drop all Fed & state taxes on fuel???
With the price of gasoline, I only drove 3111 miles this past year.
I will be getting cabin fever this time next year when all of my tv’s don’t work because of HD.
You'd have to pay 30% on each purchase. And if you sell your home now, you wouldn't have to pay capital gains taxes on a profit of $250,000 ($500,000 if you're married) but under the FairTax, you'd pay 30% on the gain when you spent it. And 30% on the original purchase price when you spent it.
Sounds great for you!
Now you want to change that by using a different example. It doesn’t rise as you claim nor has anyone ever shown that to be the case. Purchasing power actually will increase under the FairTax.
It isn’t.
The real cost of the FairTax to a taxpayer is the effective tx rate which is frequently about half your present effective tax rate. Your effective tax presently is nothing like the 35% marginal tax bracket you’re in (or whatever marginal bracket you might be in). It is the amount after filing your annual tax paperwork and receiving your refund.
THAT is your present effective rate just as your effective FairTax rate is much lower and is something you can calculate using one of the FairTax rate calculators which have had links on these threads. Many things are not taxed under the FairTax since they are not consumption.
Pretending otherwise is just that - pretense.
Nothing is taxed that is not your own free choice of consumption.
No I don't.
It doesn’t rise as you claim nor has anyone ever shown that to be the case.
The price will certainly rise. Adding a 30% tax tends to do that.
Purchasing power actually will increase under the FairTax.
That's your claim. You just can't prove it.
My effective tax on my doctor visit today is 0%. Under the FairTax, 30%.
In addition the FairTax bill does in fact eliminate the IRS and that is clearly stated in the bill.
If you’d look back at these FairTax threads for the last 5 or more years you’d see many detailed numerical examples that clearly show the taxpayer’s purchasing power increases under the FairTax rather declines as you postulate based upon anecdotal examples you chose.
You merely don’t understand what an effective tax rate is. It might help you to determine what your FairTax effective rate is so you don’t continue to post such absurdities.
My effective tax rate on doctor visits is zero. Now. Today.
Why don't you explain why my doctor will reduce what he charges, just because the FairTax becomes law. Take your time. LOL!
It might eliminate an organization named “IRS,” but there must be some collection group to enforce & receive the sales tax.
In terms of the IRS, it might be fine to start over in any case, whether a flat tax or consumption tax. They’ve pretty well blown their credibility.
A flat tax is an income tax. I know that, but the assumption is that the code as we know it goes away, and we start fresh with politican’s having to manipulate their way back to scheming and robbing the people and the economy.
I’ll live with anything that pushes the reset button.
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