Posted on 04/12/2003 7:49:12 AM PDT by vannrox
Edited on 04/22/2004 12:36:05 AM PDT by Jim Robinson. [history]
Last fall, the Wall Street Journal ran an editorial entitled "The Non-Taxpaying Class." The editorial, which dubbed those too poor to pay taxes "lucky duckies," won the Journal widespread ridicule from big-hearted egalitarians throughout the world of media and punditry.
(Excerpt) Read more at foxnews.com ...
You couldn't be more wrong. The truth is exactly the opposite.
Sales taxes & property taxes are flat, whereas income taxes are progressive. Why the confusion?
Oh? First off I never suggested that sales and property tax are not flat. Likewise, I left the word "progressive" out of my replies on this thread. Your reply is not applicable to any thing I have said.
With regard to the word "progressive" in your reply, it depends on how it is used. The current income tax can be described as progressive or regressive, depending upon which aspect or effect, is being discussed. And of course the definition used. But this has nothing to do with what has been discussed here.
With regard to which classes actually have a higher percent of their earnings (income) going toward taxes (as opposed to going for their own benefit), my answer was explained above in prior replies. That is the lower income earners pay out a greater percent of their income toward covering taxes imposed by government, than do upper income earners.
The article, manipulates the source of taxes, to claim the opposite.
Again, completely false.
I think I see your confusion. Remember that there are only 3 kinds of taxes: progressive, regressive & flat.
Since property & sales taxes are flat, ALL earners (high, medium & low income) pay the same percent. It is only income tax that is progressive; thus the article is correct & your statement is mistaken.
Hope that clears it up.
Again? You have not once addressed what I pointed out in my replies #24, 25, 30, and 42. Instead, you assert that which there is no disagreement on and is quite unrelated to was argued. Your word "again" displays your dishonesty.
In this reply, you did however, say "...thus the article is correct & your statement is mistaken." The only problem here, is your "thus" is not preceded with anything that contradicts what I had said prior. Instead you repeat a couple title words, that have nothing to do with what was argued.
At this point your repeated assertions of that which is not in dispute, as some kind of proof, only demonstrates your inability to make an argument. Heck, I may be wrong, and you may be right. But if so, you have not the slightest idea of why, or how.
Here is a thought for you. A progressive income tax is a highly regressive type of tax. Try chewing on that for a while.
You should go back and read the article. The point of the article is not who is making the higher payments of income tax. That point (not disputed by me) is used to support the main point of the article, that is, who is shouldering the "tax burden." Income tax is used to prove the point. For example, from the article:
Fewer people are paying taxes because more and more politicians are succumbing to class warfare, and granting more and more exemptions to an increasingly complex tax code.
The code here talks to income tax, but the point is who is "paying taxes." My point is that using IRS statistics does not adequately support this claim, and that the article thereby fails. I did not deny who all it is, that are writing checks to the IRS. I was disputing the point of who is carrying the burden. In other words, I was disputing that:
The tax burden is climbing higher and higher up the income ladder.
I was not disputing that the responsibility for income tax payments are "climbing higher and higher up the income ladder." I am on topic - you are not. You not only missed my point, you missed the main point of the article.
I can just imagine the gov't starting the NRST, while the income tax is still in existence.
Unfortunately one can imagine anything.
It behooves one to look at what is actually being proposed rather than merely speculating about possibilities. Speculation merely leads to rushing around doing nothing towards making thing better than the current situtation.
I suggest you take a look at the actual proposal for the NRST, and note that it repeals the income tax as well as all payroll(FICA etc.) taxes in their entirety, both corporate as well as individual, replacing them with a single National Retail Sales Tax. The income tax will no longer exist in any form with the implementation of the NRST.
John Linder (R Georgia) offers a comprehensive NRST bill to kill all income and payroll taxes outright:
H.R.25
SPONSOR: Rep Linder, John (introduced 01/7/2003)
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.
Refer: http://www.fairtax.org & http://www.salestax.org
I just find it amazing that people who hate the IRS will believe that if we pass just one little piece of legislation and everything is just going to be alright! A previous national retail sales tax post said that all we have to do is change the 16th AMENDMENT.
Easier said than done!!! Ha ha ha ha ha.
I guess if a national sales tax goes into effect, I am screwed again: 1st I paid income taxes on the IRA, then I will pay sales taxes on any amount I spend.
I therefore have a couple thousand reasons why I am against the national sales tax.
I just find it amazing that people who hate the IRS will believe that if we pass just one little piece of legislation and everything is just going to be alright!
H.R. 25, the Bill that contains the NRST abolishes the IRS
It looks like Congress won't even pass $500 Billion in tax cuts.
Congress' job is to dole out favors, through spending bills and through tax bills. I wish you Good Luck in passing ANY meaningful tax reform!!!
But there will not be an IRS with a proctoscope going over your personal income and expenses. They will only be looking at a retail store's sales and tax due amounts.
1st I paid income taxes on the IRA, then I will pay sales taxes on any amount I spend.
Hate to be the one to have to tell you this, but you will be paying federal taxes plus again when you spend your IRA money under the current system.
The following article covers the mechanism on how the current Federal tax system propagates and is embedded into consumption expenditure.
DO YOU PAY YOUR INCOME TAX
AT THE SUPERMARKET?
by D. Sherman Cox J.D. L.L.M. Taxation
The full impact of the federal tax system(taxes in gross wage/salaries & other compensation + business income/payroll taxes) added onto the base price(without taxes) of retail consumption goods and services is 36% for federal taxes alone. Why? Because all wages and the taxes on them are paid for out of sales receipts to business,(i.e. consumption expenditure).
Federal tax revenues collected as % of current family expenditure = fed/(1-state-fed-savings) =
23.5/(1-.235-0.102-0.012) = 36.09%
If we add in the cost of federal tax compliance & enforcement, the percentage that truely represents the burden on the family due to the Federal income payroll tax system increases by nearly 55% of tax free prices.
Where Have All the Dollars Gone?
How the government robs Peter to pay him back.
By James L. Payne, Reason Magazine February '94When the overhead costs are added together, (24 percent compliance costs, 33 percent disincentive costs, and 8 percent other costs), they total 65 percent of tax revenue.
Current total Federal tax revenues are about $1900billion, more than $1,000 billion additional dollars are added on onto consumption prices due to the business costs of complying with the federal income/payroll tax laws.
Percent total current federal burden (taxes + compliance costs) of consumption dollars = 36*(1900+1000)/1900 = 54.95% economic burden added on to base retail prices.
enjoy your IRA money.
Wow, so many whoppers in one article!!
The Democrats will only fight when the total tax take of the Feds is reduced as President Bush has discovered. Wrong. If any tax cut plan helps the *rich* then the Dems fight it.
By the 60's even the most obtuse left wing professors and intellectuals had disavowed the most brutal aspects of communism. You must not have been near a university recently.
According to the I.R.S. 20% of the income is not reported at all and another 6% is not paid. We are looking at 74% reported and paid. What degree of inefficiency must the present system exhibit before a more rational approach is adopted? I would think that a NRST would enourage massive amounts of black market dealings.
When you raise tax on the affluent it increases the total tax take of the Feds, adversely impacting the consumer prices the financially challenged must pay. The impact is disproportionately negative because of their smaller incomes. What kind of a leap of logic is this?
For example if an affluent consumer comes into the supermarket to purchase $100.00 of groceries, she gets $77.00 worth of groceries and leaves $23.00 for the Federal Tax account of the vendor who then uses the $23.00 to feed his own tax account and to recoup the added cost paid to shippers and suppliers based on their higher prices occasioned by Federal Tax liability calculations. I think this description is about the income tax, but the writing in general in this article is VERY convoluted.
I hope that this author gets a better editor.
According to the I.R.S. 20% of the income is not reported at all and another 6% is not paid. We are looking at 74% reported and paid. What degree of inefficiency must the present system exhibit before a more rational approach is adopted?
I would think that a NRST would enourage massive amounts of black market dealings.
It is the high marginal tax rate coupled with the capacity to avoid income reporting through cash dealing that makes "black market dealings" profitable under the income/payrol tax system >35%. How would an NRST at 23% accross the board be any worse?
What you are over looking is the point of the article, all taxes plus the cost of compliance with the tax code are currently embedded in the price of all goods and services. Remove the taxes, and the impact of code complexity from conducting business, the nominal cost of production and shelf price of consumer goods can fall on the order of 20-25%.
Replacing the income/payroll tax system with an revenue neutral equivalent of 21-23% of the total payment for goods and services merely leaves the payment by the consumer constant with regard to the present system.
Under the income/payroll tax system an individual may evade reporting and paying federal taxes on their own. Under a Retail Sales tax, where the selling business is held liable for remitting taxes on sales and the customer merely pays the business, there is little incentive for a business to risk legal exposure by not paying the tax paid by the customer. Under the income/payroll tax it only takes one person to avoid the tax, under an NRST, it takes both a buyer and sell in collusion to evade the tax.
Enforcement, need only concentrate in the 20% of companies with 80% of the retail sales dollars to assure the same level of compliance as available in the income/payroll tax system. A large company is not about to risk it's capacity to do business by not collecting taxes from customers and remitting them to the state tax authorities, especially when the business is compensated for collecting that tax.
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