Why NTU Supports the FairTax

National Taxpayers Union ^

[Man50D]

Why NTU Supports the FairTax:

The Fair Tax Act would promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national sales tax to be administered primarily by the States.

Legislative Status:

The FairTax has been reintroduced for the 110th Congress. It is H.R. 25 in the House and S. 1025 in the Senate. NTU has endorsed the FairTax since 1998 and continues to work for its adoption

Benefits of the FairTax:

The FairTax plan brings fairness, transparency, and efficiency to our unfair, complex, and confusing Tax Code.

The FairTax rewards job creation, hard work, and individual responsibility. By doing away with payroll taxes, companies can afford to hire more employees and outsourcing looks less attractive. By taxing consumption instead of income, individuals are provided with a strong incentive to work hard because they keep more of what they earn. By taxing spending, the FairTax allows us to control how much tax we pay depending on our individual lifestyle choices.

The FairTax ensures that all Americans pay their fair share of taxes. The IRS currently admits to a 25 percent non-compliance rate with the Tax Code, often done unintentionally. By placing the tax at the point of sale, no individual or special interest group could evade taxes with the help of an expensive tax attorney or well-heeled lobbyist. Furthermore, we could stop making criminals out of ordinary Americans who prepare their tax returns incorrectly by mistake.

How the Plan Works:

The FairTax proposal is a comprehensive revenue plan that would eliminate most major federal income and payroll taxes, including personal, gift, estate, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes.

[kevkrom]

Consumption is far more stable than income...

Yep. That's why we are a nation that runs on debt - individual and national.

Regardless of the truth of that statement, it has no bearing on this discussion.

By your logic, the current system would suffer worse under such scenario, and yet there never seems to be a problem with the government grabbing enough $$$ (they, of course, always want more, but that's beside the point).

What is enough money and how does government grab it?

Again, irrelevant. The original poster I was responding to made the claim that consumption was too volatile for a government revenue stream. To which I correctly pointed out that consumption is a less volatile source than income, and that the current system, for all its faults, is not noted for being too volatile.

I know from your history that you're opposed to the NRST. Is it too much, however, to ask that you try to actually keep your arguments on topic?

[Principled]

you are far more patient with posers than I. Nice post.

[lewislynn]

it's quite obvious that you have plenty of time on your hands to sit like a spider just waiting for a FairTax thread to be posted.

Look who's talking. What's the matter big talker, can't back up what you say?...

Typical Fairtax fraud.

[Turret Gunner A20]

Look who's talking. What's the matter big talker, can't back up what you say?...

Yes -- but not continuously for someone too dumb to read it.

[lewislynn]

Yes -- but not continuously for someone too dumb to read it.

No but continuously too dumb to spell it...You have as many correction posts as you do stupid posts.

[Man50D]

1. As you just pointed out for me, HR25 is NOT conditionally tied to ratification of H.J. RES 16.

I also pointed out some other very obvious facts you conveniently choose to ignore. The Fair Tax alone prevents any chance of the income tax returning by abolishing the IRS, all the statutory language concerning income and payroll taxes and eliminating the filing of tax returns. The income tax will be completely shredded by that point, before repealing the 16th Amendment even occurs.

I don’t care if your legislation “abolishes” the IRS. Congress can just as easily re-establish the IRS.

You may not care but the 140 million people who no longer file a multitude of tax forms and decide when and how much they are taxed will care enough to quash any Congressional effort to repeal a national sales tax. Just the attempt to take such an ill fated action by Congress would take many years to no avail.

HR25/S1025 does NOT require, by law, that the budget be balanced.

Nor does the income tax or any tax code because it is not the purpose of any tax system to balance the budget. At least The Fair Tax forces Congress to keep spending and by association the tax rate within reasonable boundaries. Raising the tax rate to an excessive level to fund correspondingly high spending will only result in people compensating by reducing their purchases. That in turn will reduce tax collection and therefore force Congress to cut back on spending and once again reduce the tax rate.

Founding father and first Secretary Of The Treasury Alexander Hamilton understood this concept in his Federalist Paper #21. To quote

"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."

Tying the federal budget to economic activity is simply inviting volitility to the budgeting process. What happens when an extra srong winter unexpectedly slows economic activity for a couple of months? Revenues drop

It's already volatile and more so than it will be connecting taxation to consumption! Every economic downturn results in layoffs. Layoffs equates to no income. No income means no tax collected. Economic downturns are more frequent, last far longer and effect a much larger portion of the country than your extreme hypothetical situation.

On the other hand a consumption tax will be far more stable and broader than the income tax. A consumption tax during hard economic times will still be collected from those who are unemployed for a period of time as people still need to make purchases. A consumption tax will be far more stable and broader than the income tax.

Another common misconception is to equate the prebate with a government handout tantamount to a welfare check. A prebate check is only meant to compensate people for paying taxes they will pay on necessities up to the cost of living. The amount in prebate checks won't come close to paying the bills on a monthly or yearly basis. At least one person in a household will still have to work as occurs presently.

The political debate will always be “how much to increase the prebate”.

They won't be able to increase that expenditure too high as it will require raising the tax rate but as has already been pointed out thanks to Alexander Hamilton will be kept in check by the people making less purchases.

And we know that having government involved in anything makes it less efficient.

The way to reduce Congressional involvement is by replacing the 67,000+ page tax code with the much smaller 133 page Fair Tax code. BTW, the people are the government, not Congress critters.

[Your Nightmare]

The way to reduce Congressional involvement is by replacing the 67,000+ page tax code

I've shown you conclusively that the tax code is not 67,000 pages. No where near it. Why do you continue to repeat this lie? I would like an answer.

[lewislynn]

Another common misconception is to equate the prebate with a government handout tantamount to a welfare check. A prebate check is only meant to compensate people for paying taxes they will pay on necessities up to the cost of living. The amount in prebate checks won't come close to paying the bills on a monthly or yearly basis. At least one person in a household will still have to work as occurs presently.

Fairtax own graph shows there would be more negative taxes under the Fairtax than now.

The prebait would be an entitlement just as a SS check is an entitlement. You might note that not many people can come close to paying the bills on a monthly or yearly basis with their SS entilement checks either...Does a government payout have to pay all the bills before it can be considered a handout?

They won't be able to increase that expenditure too high as it will require raising the tax rate...

Expenditure? If it's just a rebate of taxes and not a handout why would they have to raise the rate to pay for it?

[Bryan24]

It’s like talking to a concrete block.

Gimmicks will not control spending. Electing competent, fiscally responsible Representatives who believe in controlling spending will.

The FairTax is simply a gimmick with no ideal behind it.

[Bryan24]

I’m guessing that Man50D thinks that the Congress will simply tell the whiners to shut up and be happy with the prebate they are getting, right?

Just like Congress told the dead-beats in New Orleans to get to work and stop asking for handouts? How many billions were spent in New Orleans?

[Bryan24]

All nonsense objections.

The protection you seek from having both income and sales taxes doesn't exist at all today, so not existing tomorrow will not be any step backwards.

(Blank stare) Today, they are NOT co-existent. I don't have to worry about a National Sales Tax because there isn't one. DUH! Unless the 16th Amendment is repealed, I would bet my LIFE that there will be concurrent income and sales taxes.

Revenue and expenditure are completely separate issues, and all attempts to tie the two together are doomed to fail -- either at the legislative level, or in actual practice.

ROTFL!!!!!!!!!!!!! I can see this is an exercise in futility. I've got better things to do. Bye.

[kevkrom]

Today, they are NOT co-existent. I don't have to worry about a National Sales Tax because there isn't one. DUH! Unless the 16th Amendment is repealed, I would bet my LIFE that there will be concurrent income and sales taxes.

There is nothing - repeat nothing - preventing Congress from enacting a sales tax on top of the income tax right now. Why do you demand a replacement contain a protection you already do not have?

I can see this is an exercise in futility. I've got better things to do. Bye.

Yes, rather than defend your incorrect positions and assumptions, clearing out does seem like the best move.

[Principled]

Yes, it seems this fellow who "used to like the nrst but now has serious concerns" [eyes rolling - why can't they just be honest?] recognizes he'd better quit on this "point". He keeps making it for you LOL.

The bigger question is what motivates the vehement antis to claim false objections as their main mode of debate?

[Principled]

Yes, it seems this fellow who "used to like the nrst but now has serious concerns" [eyes rolling - why can't they just be honest?] recognizes he'd better quit on this "point". He keeps making it for you LOL.

The bigger question is what motivates the vehement antis to claim false objections as their main mode of debate?

[Principled]

Yes, it seems this fellow who "used to like the nrst but now has serious concerns" [eyes rolling - why can't they just be honest?] recognizes he'd better quit on this "point". He keeps making it for you LOL.

The bigger question is what motivates the vehement antis to claim false objections as their main mode of debate?

[Principled]

Yes, it seems this fellow who "used to like the nrst but now has serious concerns" [eyes rolling - why can't they just be honest?] recognizes he'd better quit on this "point". He keeps making it for you LOL.

The bigger question is what motivates the vehement antis to claim false objections as their main mode of debate?

[Your Nightmare]

So no answer? Are you just going to ignore the facts and keep repeating the lie?

[MarcB]

By (proposed) law funding wouldn’t end for 5 yrs

Funding sure can be cut to the bone for these five years. It’s called the power of the vote.

[groanup]

I've shown you conclusively that the tax code is not 67,000 pages. No where near it. Why do you continue to repeat this lie? I would like an answer.

Oh? Just 13,000 pages with accompanying 50,000 pages of interpretation? Must be a breeze to read. Why don't you post the compendious little thing?