Posted on 02/01/2008 12:06:25 PM PST by Man50D
There has been much misunderstanding-deliberately promoted by income tax system defenders recently-about the effects of the FairTax on different income segments of the taxpaying public. Let's clear the air a bit.
The greatest benefits of tax reductions under the FairTax, according to respected economists, accrue to low income taxpayers (an average 14% reduction) then to the middle class taxpayers(an average 7% reduction) and then even to the wealthy (an average 5% reduction).
How can this be and still raise enough revenues to replace all taxes now collected under the income tax system? It's because the taxpayers base is dramatically broadened under a consumption tax by bringing in illegal immigrants, as consumers, and the $1.5 trillion annual underground economy. In addition, the very wealthy pay the full 23% rate on spending, which is an increase over the typical 15% capital gains tax now paid on dividends and stock gains when redeemed (Warren Buffet's recent complaint). In a nutshell, the more you spend under the FairTax, the more taxes you pay. Remember, too, that all the gimmicks that those with tax lobbyists and tax lawyers are able to exploit in the current 67,500 pages of income tax regulations also disappear (along with the role of tax lobbyists as there are no exemptions, loopholes or deductions).
The President's Advisory Panel on Tax Reform declared that taxes would go up on the middle class under a consumption tax when they ignored the definitions in the actual pending FairTax legislation and created their own flawed consumption tax. They quietly loaded it with exemptions they felt more "realistic", ignored the distributional effects of eliminating highly regressive FICA taxes (you know, the ones that represent the highest tax payments by low and moderate income taxpayers) and refused to examine the $22 million of FairTax research. They then declared a consumption tax (which many writers have wrongly assumed was the FairTax) as requiring a higher rate and punitive to the middle class.
The FairTax monthly prebate actually wipes out all federal taxes on the poor and a diminishing amount of taxes are reimbursed the further one is from the poverty line.
There is great resistance to the FairTax within the circles of those who profit from the complexities of the income tax code. Last year 53% of all lobby expenditures in Washington, DC were paid to tax lobbyists. It's big business that includes not only lobbyists and tax related think tanks and tax reforms groups (entirely devoted to tweaking the income tax code) but academicians who have built careers on understanding the arcane details of the code.
Add to that the center of resistance to a simple, transparent system without gimmicks-the Congressional tax writing committees themselves. In truth, Congressional Members from both parties are addicted to using the tax code to reward friends and contributors, punish opponents and inept attempts to manipulate citizen behavior through the code. In other words, our tax writing process is driven by all the wrong reasons.
This is the single biggest reason that our tax code is so complex that it costs taxpayers $265 billion a year just to complete tax returns. It is so complex that the IRS can't answer taxpayer questions right more than six of ten times. It is so complex, the IRS comes up $350 billion short of owed taxes every year (raising the average taxpayer bill by about $2,000 annually).
On the merits, the FairTax takes politics out of the tax code and the tax code out of business decisions. It is the politics that are tough because passage requires overcoming powerful institutional players. To this end, Mike Huckabee and a host of other candidates have joined 72 Congressional co-sponsors and a growing army of citizens who believe that the public can still drive public policy ( a novel idea first suggested by the Founding Fathers). Otherwise, we are stuck with a system that makes debt more favorable than wealth, puts the "Made in America" label at a severe competitive disadvantage and punishes labor and investment. It's a system driven by politics, power and profit instead of economics or fairness. It's a lucrative gig for those in Washington and a destructive torture for everyone else.
Instead of borrowing money from the Chinese to pay out rebates to American taxpayers (as welcome as they will be) maybe we should think about what happens to the American economy when we make the USA the most desirable "tax haven" in the world. We have lost at least $12 trillion in American capital to offshore locations in recent years. Economists who have studied the FairTax agree that this wealth and a lot more in foreign investment will rush to our shores once the FairTax is enacted.
As FairTaxers say, "Dare to Be Fair". The FairTax won't be perfect and the transition will require adjustments but compared to the badly broken income tax system that so bedevils taxpayers and damages our economy, it's well worth it.
The FairTax research-as well as a recent article on how the FairTax helps the middle class by brilliant Boston University economics chair, Larry Kotlikoff, can be found at FairTax.org
Once again you do nothing but insult turret gunner and me. Are you going to answer the questions or are you just going to continue to disrupt?
Hit a homer, did I?
You know, and I know, and every poster on these threads knows that your “program” comes straight FRom Alinsky’s playbook.
Just as every poster on these threads knows that my one and only concern is FReedom for future generations of Americans.
If your real intention was to bequeath FReedom to future generations, you would be working as hard as the rest of us to eliminate the income tax and the IRS.
I don’t see you or any of your nattering nabobs of negativity FRiends working to do that.
Instead, all I see is hostility, negativity and some extremely bad manners.
The only conclusion I can come to is that you and others are in the employ of persons/organizations who/which have a huge vested interest in keeping the American people securely locked in the chains of IRS slavery.
Your children, grandchildren and great-grandchildren will be so proud of you!
We’re still waiting for those trick questions in post #62 to be answered.
Don’t hold your breath!
“To: Taxman
Right out of the Alinsky playbook... Don’t defend your position, personally attack your opponent...
24 posted on 02/01/2008 12:50:07 PM PST by xcamel”
“They really shouldn’t let people with screws lose to post on FR ... posted by xcamel”
Hard to believe that both of those posts were made by the same poster ....... do we have more than one person posting under the same username? Or just a case of gross and blatant hypocracy?
Hmmmmmmm .... inquiring minds want to know.
Knock off the personal attacks and instead discuss the topic.
This cross-thread flamewar ends now - on both sides.
Furthermore, the sponsors of the FairTax are totally dedicated to the permanent repeal of the income tax. :b">u>No current supporter of the FairTax would support the FairTax unless the entire income tax is repealed. There is a separate bill, HJR 16, which repeals the 16th Amendment to the Constitution but it must go through a different adoption process than HR 25. HJR 16 has to be passed by a two-thirds vote of members of both the House and the Senate and be approved (or ratified) by three-fourths of state legislatures (38). We are currently laying the organizational groundwork for this push and have already started the educational process at the state level.What part of "compel" and "seperate bill" and "it must go through a different adoption process" do you people not understand?
Who is your spokesperson that speaks for all Fairtax supporters? That's yet another meaningless paragraph from who knows (or cares) where unless you can show the legislative language that compels any other actions.
You clowns can't even get your bill to committee and we're supposed to beleive you can make yet another bill come to pass...
You pile on one lie after another with endless arrays of misinformation, promising outcomes based on suppositions you have no control over and the only thing done is book after book of more lies, suppositions and misinformation.
Like I;ve said before. If you Fairtaxers want to know why you aren't getting anywhere, look in a mirror.
Don't mind him -- it's just the early stages of insanity -- talking to oneself.
Same old, same old. At least you trolls could try to get the facts straight. But, it's obviously so much easier to stay stipid and lie about things you know nothing about (and are too lazy to study up on).Even though I was pinged prior, I have no posts on this thread up to you pinging me here...How p[athetic.
You might at least coming up with a new lie once in a while -- you've gotten boring as hell.
Are you trying to pick fights? Given the off topic wording of this entire post aside from the unsolicited name calling, isn't this taunting?
Fine with me -- until the other side starts it again. I hope you don't expect me to stand still for a bunch of guff from the other side.
Your post was on topic. However, please leave out ‘clowns’ and other such flame-bait next time. Capice?
If the other side flames, just mash abuse. We'll take care of it.
This has gotten out of hand. So we're trying to get it back within FR guidelines. And FWIW, I don't have a dog in either hunt.
1. Why do you feel that maintaining the income tax is better for America than adopting the FairTax?Maintaining the income tax are your words. Other than in you own mind, where did anyone commit to maintaining the income tax?
2. What are the main drawbacks of the FairTax? You have only pointed out the the income tax is the "devil we know".You mean besides it doesn't exist and has never been tried? If your answer is there are 45 states that have sales taxes that work great, why doesn't the Fairtax even remotely resemble ONE of them?
3. 75 economists have written and signed a letter to the President and Congress endorsing the FairTax. What economists have lined up against it?All the rest...
What's to be against yet? It's a non-starter that doesn't exist and would be a total waste of time at this point....Unless of course there's some money or other compensation in it for them.
You choose to let economists guide your way...I'm not impressed by their profession or their predictions...You are, so be it.
The 16th Amendment stays only until we get it repealed. That is the next step. I’ll write more later on this subject.
Thanks.
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