Posted on 10/13/2011 5:19:07 AM PDT by Cincinatus' Wife
Herman Cain's "9-9-9" tax reform is attracting enough attention to become the focus of this week's Presidential debate. As a plan for overhauling revenues and unleashing the private sector, it's a bold gambit that shows Cain is willing to take chances and shake up the Capital.
The 9 percent business tax is a stroke of genius. It would give us the lowest business rates in the world and would make us the "tax haven" for investment from everywhere. The stock market would barely be able to stay abreast. The 9 percent personal income rate would eliminate all the deductions and put everyone on a level playing field. Tax collection from "the rich" would skyrocket because no one would hide income anymore, but "the other 99%" would make out as well. Cain's plan would fold in the 15 percent payroll tax so the new 9 percent rate would be an improvement - but would end the immunity that the bottom half has from paying any taxes at all. Altogether a good show.
The stickler is that 9 percent national sales tax. That's where things start to fall apart....
The sales tax has long been the preserve of the states and is now imposed in all but five of them (Alaska, Delaware, Montana, New Hampshire, and Oregon). The informal arrangement has been that the federal government gets income taxes, the states get the sales tax and local municipalities are granted the property tax. Often they poach. States and even cities have imposed income taxes and have also started trespassing on the property tax. But for the federal government to demand a 9 percent sales tax would be a whole new departure. Combined with state and city levies, it puts us near 20 percent, which is black market territory.
(Excerpt) Read more at spectator.org ...
No, that's making things up as you go along. I suppose we can only wait for his website to catch up with Cain himself before we know what to believe on it and what not to believe.
Office of Tax Analysis for the U.S. Treasury Gary Robbins analyzed and scored his plan and found it would “initially create 6 million jobs and that it will bring the unemployment rate down initially to about half of what it is today.”
Those businesses need to have customers, and if the prices of goods are sky high, how is that going to happen? So 6 million jobs with 5 million workers laid off when there aren’t enough purchasers out there to keep paying for their products and services.
Cut welfare as in all at once or phasing out? Cain’s plan phases out welfare.
No, just cut welfare. Hunger is a great incintive to work.
You know you’re losing it when you first write: “The 9% sales tax is a major turd in the punch bowl for the average Joe.”
...and then someone replies with the facts: “The average Joe will have his income tax rate drop from 28+15=53% down to 9%. He’ll be delighted.”
...and all you can stammer in reply is: “Spin away.”
You should be embarrassed.
Do you understand what “embedded taxes” are? 22% of everything you buy is HIDDEN TAX. Cain’s plan reduces the hidden tax. The cost of things comes DOWN.
You forgot...unless they are consumed by the business in the course of normal business operation.
Businesses pay sales tax on what they consume. Ask your accountant if they can buy pencils and toner at Staples without paying sales tax. Ask your plumber if he paid sales tax on his work truck.
(I’m gratified that those who oppose Cain the most strongly are such economic idiots. Yes, there is plenty to debate in any major new tax plan. But you don’t need to make stuff up to debate it.)
“It doesn’t require 180 pages to explain Cain’s plan.”
Yes, and that’s the problem. It needs explanation, and Cain doesn’t have much of one. The Freepers on this thread who see its flaws have given a multitude of explanations about his plan which Cain hasn’t spoken to. Look how long this thread is. You think maybe Cain’s plan needs some explanation? Sometimes simple plans are just that, too simple.
I didn’t miss the point. His point is stupid, costly and wrong.
“even low-income voters will be more eager to lower that “9” by cutting spending.”
The poor can always by ‘used’ food./sarc
Even low-income voters will be more eager to lower that “9” by (voting for politicians who support) cutting (GOVERNMENT) spending.
Whatever pain you are presuming the poor will feel at the grocery checkout register will cause them to VOTE MORE CONSERVATIVE!
OK, I give up. What IS the right tax plan? You obviously don’t like what’s being proposed, so what should we do?
“Explaining details isn’t a “moving target,” Missy.”
I got your ‘Missy’ swingin’!
“Do you understand what “embedded taxes” are? 22% of everything you buy is HIDDEN TAX. Cain’s plan reduces the hidden tax. The cost of things comes DOWN.”
LOL! Sure the prices will come down. You joke of course.
—Can we talk about the reaction to a 16% total sales tax instead?—
Frankly, I’m willing to throw in any number. In Oregon it would be 9% total. In Washington it would be about 19%.
The point I was trying to make was simply that the more money that is involved, the more incentive people have to go around it. My uncle completely remodeled his entire home in eastern Washington and when he needed everything from furniture to water heater, washer, dryer, fridge - everything, he took a large trailer down to Oregon and bought everything there. He saved many hundreds of dollars in tax alone. Would I go to Oregon to save $50 in tax? No. But if I was going there anyway, or if I could add up a lot of purchases, yep. Assuming I lived in CA or WA.
The author (and I) is merely saying that it really will increase black and gray market activity. It’s what people do.
BTW, my uncle did this over 20 years ago.
“Businesses pay sales tax on what they consume. Ask your accountant if they can buy pencils and toner at Staples without paying sales tax. Ask your plumber if he paid sales tax on his work truck.
(I’m gratified that those who oppose Cain the most strongly are such economic idiots. Yes, there is plenty to debate in any major new tax plan. But you don’t need to make stuff up to debate it.)”
Exactly, Beelzububba. I’m convinced after reading this threat that the people here are, for the most part, not interested in trying to understand the plan in the least.
The arguments they make are the same unfounded arguments that people have levied against the Fair Tax for years.
The goal for many here is to ridicule the plan and Cain, in an very Alinsky way I might add, in thinking that it will build up their candidate. We see how well that worked for Ron Paul followers.
I hope the folks here who seriously want to understand the plan are able to wade through the garbage and lies that are in half the posts on this thread.
>>He claimed everyone pays a 15% payroll tax, which is not true.
It’s true for those making under $100,000, because the distinction between the employee’s portion and the employer’s portion is an accounting irrelevancy.
>>He claimed a family of 4 making $50000 and taking standard deductions pays $10,000 in income tax, which is flat out wrong.
$3800 income tax, $7500 payroll tax.
>>He admitted that there was no way that they could definitively say that prices would go down just because business taxes were reduced, which he has claimed in the past and which he contradicted himself on less than a minute later.
Sounds like he’s being honest, acknowledging that there are no guarantees for every instance, but sticking to the economic principle that lowering business costs generally lowers prices. That might not be the case where there is a monopoly, like a patent.
>>He said that business would be able to deduct purchases and capital investment - but only if they are made or invested with companies here in the U.S., which is something new right out of the blue. How can anyone accurately predict what the effects of his plan is on the average person if he’s changing it every time you turn around?
Be patient. President Cain will need to provide the leadership as Congress drafts the details.
You’re just pulling figures out of your azz and claiming it covers everyone. It’s just BS and spin.
“LOL! Sure the prices will come down. You joke of course.”
YOU joke of course. Are you seriously trying to tell me that you don’t understand the basics of free market competition? Companies will have to lower their prices in order to retain customers because other companies will. Mom and pop businesses will be competitive again because corporations will not have loopholes.
This is how the free market works.
You are starting to sound a bit like those folks on Wall Street - with the big eeeevill corporation “out to get the little guy” attitude.
“The arguments they make are the same unfounded arguments that people have levied against the Fair Tax for years.
The goal for many here is to ridicule the plan and Cain, in an very Alinsky way I might add, in thinking that it will build up their candidate. We see how well that worked for Ron Paul followers.
I hope the folks here who seriously want to understand the plan are able to wade through the garbage and lies that are in half the posts on this thread.”
Actually, the Fair Tax is pushed by most Libertarians. Are you one?
You’re right.
Apparently, these people are just fine paying massive, crippling taxes - as long as they can’t SEE them...
The fact that people are so upset about a tax they can see on every receipt, shows me how effective the restraints on a sales tax really would be.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.