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To: WestSylvanian

Try your best to tear down his ideas but at least he has some. I am all for getting taxes from those working under the table and using tax loopholes.
Going going gone;: IRS tax and tax attorneys

Wanna see real patriotism

http://www.youtube.com/watch?v=8yDRtZsfOtQ


59 posted on 10/08/2011 6:26:27 PM PDT by Donnafrflorida (Thru HIM all things are possible.)
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To: Donnafrflorida
Try your best to tear down his ideas but at least he has some. I am all for getting taxes from those working under the table and using tax loopholes.

Going going gone;: IRS tax and tax attorneys

Why do you think having a new tax scheme will suddenly cause people to stop avoiding taxation? When a landscaper faces a 9% sales tax and a 9% income tax on the money paid to him or her to mow a lawn, won't they (and the homeowner) be tempted to just exchange some cash and avoid the 18%? Lets see, $100 to mow the lawn if paid in cash, or $120 if paid by check. Tax enforcement will always be an issue until the tax rate is so small that avoidance isn't worth the effort, or is impossible (customs tariffs, for example).

And the IRS won't go away, nor will tax attorneys. Instead they'll be more work for them to do, since the definition of income, and what is a "sale" won't be as simple as the sound bites of a campaign speech.

Lets take some examples. Goods at the pharmacy will no doubt be subject to the 9% sales tax, so you'll pay a 9% tax on prescriptions. But it really doesn't make sense for the government to have to pay itself 9% for drugs covered by Medicare or Medicaid does it? So no doubt the 9% sales tax won't apply to purchases paid for by the government. And that alone will create the need for a gigantic bureaucracy just to sort that out.

And I doubt the sales tax will cover rentals, since that would sink most renters financially. That means that any transaction that has some component of renting - like a lease to buy contract - needs special treatment. Otherwise we'll all be leasing our new cars to avoid paying 9% of the purchase price of the car.

As far as I know Mr. Cain's 9-9-9 plan isn't a VAT tax, so the sales tax is only paid by the end consumer. That means every purchase for resale would be exempt. Take a look at the complexity and audits that occur on state sales taxes now that are related to resales, and you'll understand that the IRS will be bigger, not smaller.

72 posted on 10/08/2011 7:01:43 PM PDT by freeandfreezing
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