Posted on 01/06/2011 3:52:22 AM PST by phil_will1
Washington, DC—On Wednesday, January 5, 2011, Congressman Rob Woodall (GA-07) introduced H.R. 25, the FairTax. The FairTax legislation eliminates the current income tax paradigm and replaces it with a system of taxation based on consumption. The bill was introduced on Wednesday with 47 original co-sponsors—the most original co-sponsors the bill has ever had for its initial introduction.
“I committed to the Seventh District of Georgia that my efforts in Congress would focus on reclaiming freedom for the American people. It is for that reason that I am proud to make the FairTax—the only bill that restores transparency and simplicity to our tax code—my very first action in Congress. I have said since its inception that the FairTax is not a tax bill; it is a freedom bill,” Woodall said.
Woodall, who was sworn-in to Congress earlier in the day, played an integral role in crafting the original text of the FairTax as former Congressman John Linder's Chief of Staff when the bill was originally introduced in 1999.
"Our current tax system is a bloated, convoluted mess that gives government power over Americans' pockets. With 47 Members of Congress and counting signing their names to the FairTax, we are closer than ever before to voting on legislation that eliminates the frustrating mess that is the IRS."
Although the FairTax was introduced with 47 original co-sponsors, Woodall anticipates adding many more Members of Congress to the bill. Once the FairTax is introduced with the original co-sponsors, Members are able to sign on to the bill as co-sponsors throughout the 112th Congress.
"The number of signatures on the FairTax this time around is a testament to the will of the people. It is clear that Americans do not want to have their hard-earned money taken away and they want to reclaim the freedom to spend their money how they choose and when they choose.”
The list of original co-sponsors is as follows:
1) Tom Price (GA)
2) Brian Bilbray (CA)
3 ) John Carter (TX)
4 ) Michael Conaway (TX)
5 ) John Duncan (TN)
6) Virginia Foxx (NC)
7) Steve King (IA)
8) Michael McCaul (TX)
9) Pete Olson (TX)
10 ) John Sullivan (OK)
11 ) Mac Thornberry (TX)
12) Phil Gingrey (GA)
13) Roscoe Bartlett (MD)
14) Don Young (AK)
15) Ander Crenshaw (FL)
16) Todd Akin (MO)
17) Lynn Westmoreland (GA)
18) Tom Graves (GA)
19) Gus Bilirakis (FL)
20) Ted Poe (TX)
21) Randy Neugebauer (TX)
22) Jeff Miller (FL)
23) Robert Wittman (VA)
24) Jack Kingston (GA)
25) Marlin Stutzman (IN)
26) Jeff Flake (AZ)
27) Billy Long (MO)
28) Cliff Stearns (FL)
29) Tim Walberg (MI)
30) Dennis Ross (FL)
31) Dan Boren (OK)
32) Mo Brooks (AL)
33) Darrell Issa (CA)
34) Richard Nugent (FL)
35) Tim Scott (SC)
36) Blake Farenthold (TX)
37) Jeff Duncan (SC)
38) Rob Bishop (UT)
39) Mike Pence (IN)
40) Sandy Adams (FL)
41) John Mica (FL)
42) Sue Wilkins Myrick (NC)
43) Dan Burton (IN)
44) John Culberson (TX)
45) James Lankford (OK)
46) Mike Pompeo (KS)
47) Gary Miller (CA)
###
-- Jennifer Drogus Communications Director Congressman-elect Rob Woodall
Seventh District of Georgia 202.225.4272 | jennifer.drogus@mail.house.gov
Almost forgot. It’s important to note that, with regard to consumption, any decline would be
a) relatively small (compared to the entire economy)
b) temporary - 3 or 4 years or less (because economic growth would overtake it), and
c) comprised 100% of imports - there would actually be a small increase in the consumption of US produced goods (not only here but in foreign markets as well)
So while it may seem contradictory to forecast total net consumption declining and the economy growing, that is precisely what eliminating the bias that the current system provides to foreign producers over and above our own domestic producers will do. On a longer term basis, we end up with a faster growing economy with a better balance between savings and consumption and with US producers being more competitive on a planet where globalization is the biggest transformational change taking place.
The only thing I don’t like on the Fair Tax is that the percentage is designed to support the current size of government. It should be cut to slash the size of government.
The theory is that by making people aware of the actual amount being robbed from them to support this government,
that popular pressure will reduce the size of government.
So then it sounds like the 16th still remains active even after the Fair Tax Bill goes into effect. If that’s not true please correct me.
The original income tax proposal (1909?) was a flat tax only on corporations.
No matter what form of taxation you put in place will be tinkered with by bureaucrats and politicians. The goal of reform is to limit the damage they will do to freedom by their tinkering.
The real danger of direct taxation of income is the utter invasiveness of it essentially requiring the IRS (unelected and unaccountable) to keep and maintain a dossier on every American citizen and then require that citizen to update the information in it annually. I believe this to be in direct violation of the fourth, fifth, tenth, and possibly the thirteenth amendments.
I would favor a “fair tax” sales tax, or other indirect taxes as long as it would require a 3/4 majority to change the structure in any way. I would also like something in there that would state that congress would be limited in what they could spent to a percentage of GDP.
I also think that we should do a thorough audit of the IRS and any infringement of constitutional rights or criminal laws by their minions would be prosecuted fully and without the insulation given them by being a member of a government agency.
I also want a pony.
“So then it sounds like the 16th still remains active even after the Fair Tax Bill goes into effect. If that’s not true please correct me.”
The FairTax has a provision which would “sunset” the bill itself if the 16th amendment is not repealed within 7 years. That is, if the 16th isn’t repealed within 7 years, then the old system is reinstated and the sales tax goes away. Because ratification/repeal of a constitutional amendment is such a high hurdle, it will take longer than the passage of a simple bill. However, FairTaxers have enough confidence in the proposal that they know that once the FairTax is put in place, the American public will demand that it be made permanent and the political pressure on the federal and state legislatures to repeal the 16th will be enormous. Generating that much political pressure in advance of implementation is virtually impossible - which is what the opponents are banking on who insist on repeal of the 16th before the FairTax is passed.
FairTax bump.
“Isn’t ‘revenue neutral’ kind of a moving target?”
Somewhat moving. However, a couple of studies were done in the 2005 timeframe (app.) and they validated the original rate calculations done in the late 90s - within a percentage point or so. The reason is that it is spending that has gotten out of whack, and taxation has not risen proportionately. That is why we have a big deficit. Well, part of the reason. The other is that economic growth has slowed, which is what the FairTax addresses.
However, bear in mind that the revenue neutral calculation is done on a static basis, which is what current congressional rules require. If the calculation were done on a dynamic basis, the FairTax would be highly revenue positive because of the substantial economic expansion it would create.
The dispute over static vs dynamic scoring has, of course, been raging for some time in the halls of congress completely independent of the FairTax.
“Pass an amendment abolishing the income tax first. Then we can talk about Fair Tax.”
What I like about the fair tax is that it contains a caveat to insure that you don’t have both an income tax and a consumption tax. It requires that the income tax stop before a consumption tax is started.
There is nothing to prevent the addition of a consumption tax today, in addition to the income tax. This adds a bit of protection to us....
“Tax COLLECTION is not the problem. Spending is the problem.”
I agree and I would also agree that the fairtax does absolutely nothing in itself to address spending. That said, I like that it would hit every voter in the head with every purchase the cost of government. It would bring the cost of government to the forefront of visibility. As things are now, so many people have no idea of the taxes they actually pay. There is no accontability because the true cost of government is hidden beneath multiple layers of nonsense.
By giving the electorate a clear vision of the cost of government spending, I’d wager that spending reductions would be demanded by the large majority of voters.
How do you get the majority to support spending reductions when they don’t see the effect of that spending?
But if congress is still spending and part of that spending is hidden from the tax payer by borrowing (say spending at 23% of GDP but only taxing at 19% GDP), then the tax payer STILL will not see the cost of government.
“But if congress is still spending and part of that spending is hidden from the tax payer by borrowing (say spending at 23% of GDP but only taxing at 19% GDP), then the tax payer STILL will not see the cost of government.”
That component of spending is already highly visible in the form of the federal deficit. There is more attention being paid to the deficit now than I have seen in my lifetime. Of course, for most of my lifetime deficits weren’t anywhere near the level they are now. However, it appears that the federal deficit has become one of the top political issues of 2011, due in no small part to what happened on Nov. 2.
>>That is why there is a transitional credit included
Is there a traditional credit included for those of us who were dumb enough to save and try to fund our retirements... with savings $ that have already been taxed? Or are we just SOL?
“It’s a tax reform proposal which eliminates income taxes (both individual and state),”
I have to admit that I have not been active in the discussions for awhile, so I may have lost touch. How would the federal law eliminate state income tax?
our current tax code started as a FLAT TAX, only on millionaires....
fairtax is the way.
Okay, that’s better.
Then there are those who just want to make sure Washington will still get their money.Revenue neutral, "to make sure Washington will still get their money" . That is the (stated) goal of the Fairtax plan, not mine.
Wrong again Lewis! That is what the LAW requires of any replacement tax plan Lewis!
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