Gutknecht pushing national sales tax

Pioneer Press ^ | 11-15-04 | ap

[Rakkasan1]

MINNEAPOLIS - Rep. Gil Gutknecht is pushing legislation that would replace the federal income tax with a national sales tax.

"Think of a world where there is no income tax, where you get to keep everything you earn and you pay the tax man when you buy stuff," Gutknecht, R-Minn., told the Star Tribune of Minneapolis.

[Zon]

Citing a U.S. Treasury study which indicates that 6 billion man-hours are consumed each year just in the record keeping for income and payroll tax returns alone

Six billion hours is probably the total number of man-hours consumed manufacturing automobiles in the US. Imagine if US had no automobile manufacturing industry.

Three million people working 2,000 per year equals 6 billion man-hours. Divert their work towards tax work and apply that to almost any one  industry and it would be wiped out.

[Rakkasan1]

Hard to believe so many are so vehemently opposed this idea.
Much better I guess to keep the old,draconion 50 thousand
pages of rules,exemptions,and clauses so we can keep
all the lawyers and accountants employed.
Goes to show how powerful the federal employee unions have become.

[lewislynn]

The average sale is $100 gross of which $50 is profit.

Income taxes are on profits and gains.

You seem to think you have all the numbers worked out, could you explain what the tax rate is on 50% profit that would equal a 22% reduction in prices.

While you're at it could you list the companies working at 50% profit, I'd like to invest in them.

[agitator]

"What have you "heard" about the IRS directing their tyranny at a smaller number of victims? Under the Fair Tax there will be NO victims. The government WILL NOT know how much money you earn since there will be no withholding and no filing of income yearly or quarterly. Businesses will not be taxed at all (not that they are now, anyway). What's so hard to understand about this? I agree it's not rocket science. It's a simple and elegant plan that is fair to all and everyone pays their fair share."

I swear you guys are like citizens of Stepford. Will retailers be filing with and sending returns directly to the federal govt or not? Furthermore, and as I've pointed out before, a broadly based excise tax on everything was not what the Founders envisioned. See Hamilton. Think luxury boat tax. I've wasted enough time on this thread as it is.

[WhatHappenedtoAmerica]

Even with that scenario we should support a national sales tax. For one, it will make for a better future. Also, any of that money you've saved will now accrue income (interest or capital gains) tax free. It's still a good deal.

[Zon]

You completely and totally missed The Point. Having read many of your posts I can assure you that you'll never understand The Point..

FWIW, you used to be funny. Now you're not even mildly amusing.

[agitator]

Spare me the personal insults, I'm not impressed. What you propose and what gets enacted are two different things. If you think the IRS is going to evacuate the states and live in a tree in DC, you're yet another Stepford citizen. I defy anyone to show me any federal agency a fraction the size of IRS that went away and 75 years of history of federal authority within the states getting larger not smaller is a hard trend to argue with, pal, no matter what you're armed with. Yeah, sure, the federal government is going to beg the states for money when all they have to do is redirect that army of IRS parasites to local merchants. Oh joy, they won't be in *your* face. I'll just withhold the "I told you so" when your precious, carefully crafted legislation gets shredded in Congress and what comes out looks nothing like what you put in. BTW, after you get exactly what you want from Congress, let me know when the puny ATF hands off its authority to the states and goes away. On second thought, forget it, I won't live that long.

[Taxman]

You are still unarmed.

The IRS will be abolished.

Go read the legislation.

[Taxman]

I've wasted enough time on this thread as it is."

Yes, you have. See ya!

[Your Nightmare]

Can you point out the posts?

I don't keep tabs/links on stuff you need. Perhaps somebody will repost them.

It's funny how everyone knows they have seen them but, when asked, can't seem to find them.

[Your Nightmare]

The average sale is $100 gross of which $50 is profit.

So $50 in profit, $22 dollars in taxes... that leave $28 for materials, labor, distribution, state taxes, etc.

Sounds reasonable!

[what a joke]

[lewislynn]

You completely and totally missed The Point.

Really?

If The Point wasn't that half of businesses gross was 50% profit AND they could maintain 50% profit after lowering their prices 22% by eliminating their taxes on profits, what was The Point?

[lewislynn]

FWIW, you used to be funny. Now you're not even mildly amusing.

I don't know what "FWIW" means (nor do I care) but funny and amusing aside. I am right.

[Your Nightmare]

For every $1 we pay in direct taxes, we spend an additional $0.65 in compliance costs.

I found a used copy of Payne's book. Maybe you'd like to explain to everyone how he came up with his numbers so they could see how ridiculous they are, besides being completely outdated.

[G Larry]

For Crying Out Loud!

You can't just salute a National Sales Tax without citing the RATE!!!!

17% YES!!
23% NOOOOOOOOOOOOO!!!

And, do we drive a stake through the heart of Federal Income Tax 1st?
Isn't this just a little bit important?

[ancient_geezer]

Maybe you'd like to explain to everyone how he came up with his numbers

Since you have the book, you are aware that he compiled the studies of many others, and thus is not his own estimation. Now if you wish to go to each of his cites and break down their studies in detail you are welcome to do so.

FLAT TAX by Hall & Rabbushka '95: Notes & References:

A comprehensive review of all the studies that attempt to measure the costs associated with the federal income tax appears in James L. Payne, Costly Returns: The Burdens of the U.S. Tax System (San Francisco: Institute for Contemporary Studies Press, 1993). Payne summarizes the estimates of compliance costs that appear in the following studies: Joel Slemrod and Nikki Sorum, "The Compliance Cost of the U.S. Individual Income Tax System," National Tax Journal 37 (December 1984): 462–65; Arthur D. Little, Inc., Development of Methodology for Estimating the Taxpayer Paperwork Burden (Washington, D.C.: Internal Revenue Service, 1988), pp. III–23; James T. Iocozzia and Garrick R. Shear, "Trends in Taxpayer Paperwork Burden," in Internal Revenue Service, Trend Analyses and Related Statistics, 1989 Update (Washington, D.C.: U.S. Government Printing Office, 1989), p. 56; Annual Reports of the commissioner of the Internal Revenue Service; and a variety of other IRS memoranda

And I am sure you have also noted the other economists and tax system experts listed in the same reply who's determinations agree with similar findings, some more some less than Paynes compilations:

Edgar K. Browning, "found that every dollar of taxes could impose as much as $4 of lost output on the economy, with the probable harm ranging between $1.32 and $1.47" in 1987

confirmed by Jane G. Gravelle and Laurence J. Kotlikoff when they "estimated that the corporate income tax costs more in lost output than it raises for the government." in 1989

As well as the findings of

Daniel Pilla in '95, figuring "burden is estimated at $700 billion annually. " and
Ernest Christian Jr., figuring "true burden on the U.S. economy is probably closer to $1 trillion" for the $1,275 billion federal tax revenues collected in '94

And

Dr. Dale Jorgenson "found that each extra dollar the government raises in revenue through the current system costs the economy $1.39." in '96

---

 

so they could see how ridiculous they are, besides being completely outdated.

They all are undoubtedly are outdated( a decade later is some instances being based on the much simpler '87 tax law) and ridiculously low in comparison to today's burdens with the rising accounting, planning, and litigation costs and disincentives associated with dealing with the federal tax system's cumulative compexity:

 

Source: CCH Inc. Number of pages in the CCH Standard Federal Tax Reporter, as found on Cato website.

[Zon]

But he's got an overly obnoxious self-righteous attitude on his side. That's got to count for at least something, doesn't it? Not to mention he has fully resigned himself to give up and bow to the status quo. Generally refereed to as the self-righteously spineless.

[Zon]

You are forgetting that the buyer has to pay sales tax on the home 

Does the house buyer have to pay the NRST on a used house they buy? No. You oh so conveniently omitted that fact. Existing home sales account for 85% of the residential real-estate market.

[Zon]

It's funny how everyone knows they have seen them but, when asked, can't seem to find them.

It was never worth my time and effort to search for them for you. Thankfully, you and those of your ilk are in the minority 

See post 90

DeMint won by the landslide proportion of 10 percentage points.

Coburn won by the landslide proportion of 12 percentage points.

All were endorsed by the Club for Growth, and all won in landslides. 80

They article is very encouraging. The typical person -- whatever typical is -- can readily understand the benefits of the NRST. And do so despite having disinformation thrown in their face.

With the latest "shenanigans" of the old media I foretell that in covering the NRST they'll again severely discredit themselves. 

[Zon]

what was The Point?

Since you obviously missed it last time, I'll repeat it here: "Having read many of your posts I can assure you that you'll never understand The Point.." 106