Posted on 01/20/2008 6:29:07 AM PST by Man50D
During an election season, one of the first losers is the truth. The current misinformation campaign against the FairTax has been particularly virulent. Last month the FairTax was being panned by some columnists as a "crackpot scheme," even though it could be collected exactly the same way as its close cousin, the value-added tax, which is the most successful tax in the world. This month the FairTax is being vilified by various columnists as a tax increase for the middle class, even though it would provide a substantial tax cut for two-parent middle class families. Specifically, in a recent column, George Will asked, "Do you want a president (Mike Huckabee, proponent of a national sales tax of at least 30 percent) pledged to radically increase the proportion of federal taxes paid by the middle class?" Similarly, Time magazine's business and economics columnist Justin Fox wrote a blog piece entitled, "The FairTax and its big break for the $200,000-plus crowd."
The FairTax is a national sales tax that would replace the income taxes, the payroll taxes, and the gift and inheritance taxes. It would be a 30 percent sales tax on retail purchases. Since 30 cents is 23 percent of $1.30 (the amount you would pay on a $1 item), a 30 percent FairTax would cost you about 23 percent of your consumption. To help you pay the tax, you would get a prebate check or a debit card credit at the beginning of each month equivalent to the amount you would pay when buying necessities. In 2007, that amount would have been based upon $10,210 spending per adult and $3,480 spending per child.
(Excerpt) Read more at worldnetdaily.com ...
ROFL... That figures...
Thank you for replying.
With all due respect to your concern about what people "know" about federal government corruption, the problem concerning tax reform is that the people first need to clean up corruption in the federal government, in my opinion, before they will have a solid foundation for implementing fair or flat taxes. After all, what's the point in implementing fair or flat taxes when most of our tax dollars are arguably still going to be spent on constitutionally unauthorized federal spending projects anyway?
Next, given that the historical material that I've been referencing is older than FreeRepublic and some tax reform organizations (corrections welcome), I will argue that this web site shouldn't exist if people were really up to speed, as you have asserted, with the finer points of constitutionally limited federal powers, especially those powers associated spending.
In other words, even in this message board I see people fighting politically correct liberal interpretations of the Constitution with politically correct conservative interpretations of the Constitution. And liberal interpretations are certainly going to win over politically correct conservative interpretations until further notice. This is because liberals have the Constitution-ignoring Supreme Court majority to defend their perversions of the Constitution. In fact, the following links are evidence that ignorance of the Constitution and how the government is supposed to work is epidemic, undoubtedly affecting even some FreeRepublic members.
http://tinyurl.com/npt6tThis is why I post comparisons of extracts from authoritative, Constitution-related historical materials with extracts from Court opinions. Post-FDR era Court opininons, particularly from state power related cases, often contain statements which outright contradict the historical material, material which clearly reflects the intentions of constitutional lawmakers.
http://tinyurl.com/hehr8
The bottom line is that the special-interest Supreme Court majority is getting away with perverting the Constitution because the people simply don't know the Constitution and its history.
For example, regardless that the North won the Civil War, post-Civil War pro-Confederacy factions seem to be having the last laugh, arguably winning the cold war aspect of the Civil War from the bench of the Supreme Court. FDR-nominated "former" Klansman Justice Black and his politically correct interpretation of the Confederacy-disdained 14th A., as he used it to help justify applying the establishment clause to the states, comes to mind.
Getting back to fair and flat taxes, again, the Constitution-ignoring federal government needs to be cleaned up, in my opinion, before any tax reform efforts are really going to be worth anybody's time.
Finally, to address your concern about the "obvious" points that I make in my posts, as a rule, I try to limit my rants to one rant per thread. But contrary to your assertion that everybody knows what's going on, and with all due repect to the good intentions of FreeRepublic posters, it is discouraging to see related threads continually popping up which volunteer solutions to government problems based on the same tired, politically correct generalizations about what the Constitution is popularly perceived to say.
Sorry. I was the one who made him hysterical.
The taxes are a retail sales tax. The plan could be to monthly refund a portion of those taxes or to credit those taxes ahead of time and it would come out to the same thing.
The plan chose to issues the refund as a credit up front instead of after the fact.
Just the same, the person will still pay taxes on retail sales with that money and any other money that person spends.
You are avoiding some questions.
What kind of people will not be spending money at the retail level to the point that the prebate would be an economic boost for them?
How many people do you estimate will actually come out ahead solely based on the retail sales tax credit?
An adult with 4 kids will get a monthly credit of $462 based on estimated consumption of $24000 per year. Whether that payment is made before or after the month is really irrelevant since it offsets a portion of the retail sales tax that they pay that month.
For this family to not pay any taxes at all they would have to avoid all retail sales and that is not probable, even if possible. It is possible for there to be a net tax payment of zero dollars but at that point one is probably living a lifestyle that most of us do not wish to emulate.
So I’ll ask you again to please describe those you see as receiving welfare in the form of the Fair Tax prebates.
He’s trying to argue that since the money is before the month as a credit instead of at the end of the month as a rebate that it is welfare, financial aid, government assistance, etc.
It probably sounded good in his head but really doesn’t hold up very well to scrutiny.
The end result is that a household will receive a portion of the money that they spend in retail sales tax back.
It isn’t like the EIC where a person can get an income tax refund that exceeds the amount of income taxes paid.
For the FT to be fair, the gov't would have to send out a prebate to cover the previously taxed investments made. If the rate were to ever rise (Couldn't happen - it's against the laws of physics, right), there would have to be another prebate. That'll be simple.
YEah, I screwed up on this post. Somehow I thought the discussion had turned to what W wants to do by passing out $800 checks. My bad.
As described above, anyone who gets a prebate larger than their FT "gift" to the gov't for that month (cash or accrual accounting - no difference)is getting welfare. Wealth transfer FROM the gov't. It's a simple definitional situation and it could happen more than once. Read the welfare book.
Who knows how many, it only takes one to make it true that it is welfare. But once people are incentivized to not spend there will be an increasing number. Just the way things work.
How much will state and local taxes add? State income tax is 50% of my Federal tax bill — and that doesn’t count property tax and the current sales tax.
Let’s assume that the current 5.5% sales tax stays, then they would have to add another 15% levy to cover uncollected income taxes and the property tax. Is there going to be another 20.5% on top of the 30% Federal tax?
I immediately see 4 issues.
FT foists collection costs to the states. Are the states adequately compensated by the Feds?
What about those states that don't have a sales tax? Do you think that will cause any disruption to those states (Don't go off the reservation complaining that US citizens in those states don' t count 'cause you have never been there. That's a personal problem - not necessarily addressed to MM, but to others who want to chime in).
Some states who do have a sales tax have exemptions (e.g food, services). Do the FTers have ANY idea what those states may do to their ST exemptions?
Then there is the state IT issue as pointed out. Many state ITs are tied to the Fed IT. What ARE those states expected to do?
It would be good to have this all, among likely many other issues, BEFORE we go down this path.
Those consumption taxes are GOOD for you, no matter how high. ;-)
It's neither. The monthly stipend goes out regardless of how much or how little tax is paid by the recipient.
"Transition matters" is only a small part of a transition plan.
You have to write an essay to explain the phoney rate but a transition plan only takes a couple of paragraphs...Got it.
It isn’t like the EIC where a person can get an income tax refund that exceeds the amount of income taxes paid.Actually the Fairtax own graph shows more negative taxes than the income tax...But then the same graph shows it's not revenue neutral too.
It isn’t like the EIC where a person can get an income tax refund that exceeds the amount of income taxes paidApparentley you haven't visited the Fairtax calculator. It will show you how you will have more spendable income than you actually earned.
Who is eveyone supposed to believe, you or the information put out by the Fairtax?
Since everyone is supposedly paying those same “necessity” amounts in hidden taxes now, the monthly checks for everyone should start going out now. By FT logic anyway.
It's one of the pillars of the FT. No proof, just a feeling.
It's emotional. Most FTer plan to get something for nothing. They are going to be able to decide for themselve how much money the give to their slave masters (as if slave masters would ever allow a transfer of power).
FT plan:
1. Lie about consequences of FT.
2. Promise vision of riches to supporters.
3. Pass FT
4. Sell drugs with no fear of hiding income from the IRS.
5. Profit!
(-$846,468.93) sales tax. Also get a -100% increase in spendable income. WTF?
My situation apparently causes the FT calc to blow up. What a joke.
One definite deficiency with the calc is that it doesn't appear to seperate investment income from earned income (SS calcs). Other deficiencies: take into account age, plan for more than one year, take current assets into account, plan for inflation, plan for growth in gov't and likely much much more. Before one decides if the FT is a winner for you, you may want to examine your lifetime finiancial plan with and without it. We know from some discussion above that many FTers here think that planning more than a week ahead is for losers. Planning for two months (where you might get welfare in alternating months) is beyond comprehension.
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