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 ...
“If the FT is worse for the politicians, you aren’t going to get it.”
“I discussed the importance of abolishing the income tax because of its tendency to form a habit of servility in the souls of a people that accept it. Servility of soul is bad not only in itself, it is also an open door through which will soon walk the abuses of ambitious government power. Leaders who find themselves with governmental power over a servile people will be quick to conclude that such a people exist to serve them.”
Alan Keyes “The Power of the Purse”, WorldNet Daily, August 27,1999
I have no business plan to become a DD. It’s just an observation that the disincentives to become a DD are lower with the FT than now. Unintended consequences and all.
“I can just imagine the administrative headaches with this system. I can’t imagine it would reduce the government workforce at all, and it would ALSO add to retailers costs as well...”
LMAO!! So you are defending the current system on the basis of its ease of administration and its efficiency?
Are you sure that is the position you want to stake out?
“You can maximize the number of checks from now till hell freezes over. You cannot increase the total amount of the checks. Next silly objection?”
These guys raise such silly objections and then they wonder how we know they have a vested interest in the perpetuation of the current system. Some of them are REAL stretches. As if it weren’t obvious!!
“Note that taxation systems work better when they are stable so people can do some long term planning. The uncertainty caused even by discussion of the FT will cause some negative economic outcomes too.”
So you are defending the current system based on its stability and predictability?
Is that your final answer?
The current system, especially when combined with FICA and Medicare issues has way too much churn and likely churn to provide much in the way of long term planning stability.
“By the way, the President’s Advisory Panel on Federal Tax Reform found that the national sales tax rate would have to be at least 34 percent to bring in the same revenue as the programs the ‘fair tax’ would replace.
It also found that the ‘fair tax’ plan would create the largest entitlement program in American history.”
The President’s tax panel issued two reports. The first, released in April of 05 (if memory serves) was titled “America Needs a Better Tax System”. It was a scathing indictment of the current system and was a summarization of the feedback which the panel received from the American people via e-mails, town hall meetings, etc. The second (and final) report was released late in that year and it recommended some minor changes to the current system. Obviously, the special interests had a chance to weigh in between the first and second report and strongly influence the outcome.
This is always a risk when you stack a panel like this with (future & present) lobbyists.
“....someone who paid no sales tax would still get the monthly check.”
How would someone pay no taxes? How can consumption be zero? Do we not all have to eat, clothes to wear, a place to live and utilities?
“You have no idea what my preferred form of taxation is. Just because I don’t think THE FT is nirvana and don’t want to be a member of your cult doesn’t even mean I don’t think consumption taxes have their advantages. Please, get a grip.”
Your actions speak louder than your words and much, much more eloquently that your (unexpressed) thoughts. You have been highly critical of the FT and its supporters on this thread, yet I have not heard a word of concern about the current system which is dysfunctional in many, many respects. If you have a better tax reform proposal, please direct us to where its particulars are. Please also direct us to where you have expended as much energy explaining the benefits to others as you have nitpicking the FT.
If you can’t do either, then you are like many of the SQLs here on Free Republic, fighting vainly for a failing system. You are either disengenuous or not aware of the import of your actions.
Your actions speak so loudly that I can’t hear a word that you are saying.
As previously noted, as the tax rate approaches zero, the details and even major conceptual differences among the types matter less and less.
“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.”
This may be a bit of a chicken and egg argument. However, it is hard to envision the American people ever getting sufficiently aroused about unconstitutional spending with a tax system which hides so much of the cost of those spending decisions from them. Many FT supporters believe that passing the FT is an important incremental step in moving toward a more accountable federal government.
I have encountered quite a few “purists” who take the position that they want their constitutionally limited government and they want it now - no incremental steps for them. Unfortunately, they don’t seem to be making much headway as they still represent a tiny, tiny minority of voters.
“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?”
There will be a number of incentives for states to harmonize their tax systems with the FT. That means, among other things, that they would abandon their extremely inefficient system of exemptions and adopt a rebate system. There are already several states (GA and MI) where there is considerable support for such a change. There is no requirement, of course, that they do so. I suspect that any states holding on to their exemptions will abandon them within a few years of the FT going into effect.
“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?”
They can either harmonize their tax system with the FT (meaning eliminate their IT) or they can develop their own Internal Revenue Code from the ground up ( a daunting undertaking for a part-time state legislature, both practically and politically). This is why we say that most Americans will get to keep their entire paychecks (including state deductions).
When we succeed in repealing the 16th, states won’t be able to continue taxing income, anyway.
I HOPE that you aren’t saying that we should retain a highly dysfunctional tax system at the federal level so that states won’t have to abandon their own dysfunctional system.
“Those consumption taxes are GOOD for you, no matter how high. ;-)”
“It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess. They prescribe their own limit; which cannot be exceeded without defeating the end proposed, that is, an extension of the revenue. When applied to this object, the saying is as just as it is witty, that, ‘in political arithmetic, two and two do not always make four.’ If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them.”
Alexander Hamilton in Federalist #21
To: dan1123
One poster indicated that there was no need to consider future spending beyond a week. Just got me to thinking.
287 posted on 01/21/2008 11:14:43 AM PST by Paladin2 (Huma for co-president!)
[ Post Reply | Private Reply | To 285 | View Replies | Report Abuse ]
To: Paladin2
It depends on when major recurring expenses happen. I have quarterly car insurance payments, so 3 months is necessary to take that into account. I don’t understand how someone could get by without planning out longer than a week. I could only do that when I was single and living on less than a third of my paycheck.
288 posted on 01/21/2008 11:19:10 AM PST by dan1123 (You are to be perfect, as your heavenly Father is perfect. —Jesus
The poster he was referring to never said that he didn’t plan expenditures longer than a week. This is a common tactic by those trying to defend the current tax system - they take quotes out of context and mislead about the meaning of FT supporters.
“If people are paying that much in hidden ‘necessity’ taxes now, why not send the monthly welfare checks out now?”
That’s your tax reform proposal, not ours. If you think that’s a good way to reform the system, lobby your congressman to introduce a bill which accomplishes that.
“I’m still waiting for your better idea.”
“Don’t impose the idiotic 30% VAT cousin. That’s a better idea.”
What was left out of this post is much more revealing than what was typed in.
Here is what was left out: “keep the current system pretty much as it is.”
Why can’t you SQLs admit that you support the current tax system?
Borrowing hides spending decisions. Total government liabilities were 20 trillion dollars in 2000 and are now at 52 trillion dollars. Do you feel the pain - nope, you got a tax cut. Would you have felt the pain with the FairTax - nope.
I have encountered quite a few “purists” who take the position that they want their constitutionally limited government and they want it now - no incremental steps for them. Unfortunately, they don’t seem to be making much headway as they still represent a tiny, tiny minority of voters.
The FairTax is not an incremental step. It does not restrain spending, borrowing, or even demand a relationship between the two.
“So in your world, everything is black or white? If a person opposes the Fair Tax, s/he is a ‘IRSer’?
That’s sophomoric.”
Not really. If someone opposes the FT and they have a tax reform proposal which they want to advocate, most FTers are happy to debate. Most of the FT’s critics obviously don’t care for real tax reform (if judged by their actions), they just want to attack the FT and its supporters. Their agenda is very transparent, even though they don’t realize it.
The default situation is a continuation of the current highly dysfunctional system; that isn’t even debatable. Either a single plan emerges which is widely viewed as an alternative to it, or it will continue, at least until it collapses of its own enormous weight or creates major economic disruption. Right now the FT has emerged as the most viable alternative to that system and, as such, is seen by the defenders of the status quo as a threat.
I personally would love to see a flat tax proposal that all flat taxers could rally around. As it stands right now, there is no such thing as “the flat tax”. If you ask 5 flat taxers what specific proposal they support, you are likely to get at least 4 different answers (or none at all) and none of them will be the Burgess bill, the only flat tax proposal in the house. And yet, you still see posters on FR say that they support “the flat tax” as if it were a specific proposal and not merely a form of taxation.
Many (but not all) of the SQLs are too cowardly to admit that they have a vested interest in perpetuating the current system. They realize that the system that they have learned how to game, or how to exploit for their own personal benefit in some way is tremendously unpopular with the American people.
“Makes the US the world’s largest tax haven.”
“What is the advantage of being a tax haven?”
1. Capital flows, which leads to
2. Job creation and
3. faster economic growth
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