Gutknecht pushing national sales tax

Pioneer Press ^ | 11-15-04 | ap

[ancient_geezer]

Explain that to my accountants, maybe I can get a deduction for "triple" taxing of my money.

Tax-a-phrenic: Paying $4 interest to a banker to avoid paying $1 tax to the IRS, so the banker can pay the IRS a $1 for you.

Wages-of-Sin: An employer pays a tax on wages for the sin of hiring you, You pay a tax on wages for the sin of working, and a second tax on your wages so some another guy can go fishing, drink, and sin some more.

Why pay taxes on income at all?

It is much better to collect taxes on what one receives as benefit from the economy as measured by what one consumes, than by one's productive contribution to society as measured by one's income.

[Bigun]

Way to go represenative Gutknecht!

If the American people are ever again to be a FRee people we MUST rid ourselves of this communist inspired abomination called the progressive income tax and, for the first time in a LONG time, we have a REAL chance at getting that done!!

http://www.fairtax.org

[ApesForEvolution]

Anyone that does NOT advocate lifting IRS tyranny either doesn't pay in or has a shovel in the Federal Mafia treasure chest machine, private or not.

[Terabitten]

Worse yet, there will be an IRS agent sitting next to every cash register. I have yet to see the NRST people address exactly who is supposed to collect that sales tax.

Forgive my stupidity, but why? States don't have state tax collectors at every cash register.

[2Jedismom]

Yippeeee!!

[ancient_geezer]

Did you ever get a list of how Fair Taxers did on Nov. 2nd?

Haven't been able to track that one down yet. I sent out a second message to AFFT(priority this time) to see if I can spur them into compiling a list of the results.

I know that nearly all if not all incumbants running with the FairTax were re-elected, I don't know the results of those running for office as a challenger or for the first time.

[agitator]

Constitutionally speaking (oh, let's not bother with that tired old annoying POS) the states are supposed to collect taxes and the fedz are just supposed to send the state a bill. I hear all of the NRST people salivating over "getting rid of the IRS" when in fact, from everything I've heard, they'll just get redirected at a smaller number of victims. This is not rocket science.

[agitator]

See #67

[agitator]

See #67

[ApesForEvolution]

Hear HEAR!

[ancient_geezer]

Why should she be taxed again just for spending money that she saved?

Lifes not fair and never has been. She will pay just as much tax burden [20-25% in price inflation due to business tax burdens] again under the current system as soon as she spends now, same as you do.

Between business income taxes and payroll taxes, the burden on citizen as reflected through higher prices, lower wages, and lower return on investements are indeed horrendous.

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.

As soon as we start adding IRS staff to handle that problem, we have lost the original intent of a national sales tax.

The administration of the National Retail Sales Tax will be turned over to the same state agencies now administering retail sales taxes today, there will be no federal IRS, and no more intrusive imposition on family financial privacy that the IRS represents under any income tax.

Which is precisely why there will be no IRS in your hypothetical under the NRST, for the issue of taxing savings indirectly through purchases is present in any tax system you can conceive and cannot be resolved.

What HR25 does do however to alleviate that problem and others, is assure that no one is taxed again or even the first time on their expenditures on up to the povertylevel of expenditure:

A family of four, for example, could spend $24,980 per year free of tax because they will have received over the course of the year a demogrant totaling $5,745. $5,745 is the amount of sales tax paid on $24,980 in expenditures. That family spending double the "poverty level" or $49,960per year will effectively pay tax on only half of their spending and, therefore, have an effective tax rate of 11 ½ percent or half the FairTax rate.

The beauty of the FairTax is that you can control how much you pay in taxes. If you happen to save, invest or spend a portion on used [previously taxed] items, you can get your effective tax rate below 9%.

To illustrate examine the tax burden that a family of four will have at various annual expenditure levels as compared to that same family under the current tax law, (2004 income plus FICA/MC):

 

H.R.25 "The FairTax Act

[xrp]

You already pay that 23% in reimbursing corporations and business for their tax burden.

[Zon]

A national sales tax will NOT benefit wealthy people in any way shape or form.

You may want to do some research before you.... well, as Mark Twain once said: "It is better to keep your mouth closed and let people think you are a fool than to open it and remove all doubt."

Or, if you choose not to put forth the effort to research at least have the sense to ask questions.

1. Under the income tax products and services have embedded taxes that raise the consumer cost by 20 to 25%. Thus, money that has already taxed is taxed again at the cash register to the tune of about 22%. Those embedded costs are eliminated with the NRST. So it's essentially a wash -- the cost at the register will be the same.
2. Under the NRST, only new retail goods are taxed. Used items will not be taxed.
3. Now for the biggie: the wealthy are just as venerable, perhaps more venerable than the non-wealthy to an IRS that can confiscate a person's wealth with impunity and ruin their life in the process. RS Abuse Reports -- The Case Against the IRS

[ancient_geezer]

Constitutionally speaking (oh, let's not bother with that tired old annoying POS) the states are supposed to collect taxes and the fedz are just supposed to send the state a bill.

Please cite anywhere in the Constitution or the Federalist Papers that is supported.

For the opposite appears to be the real case as far as I can determine. One of the prime reasons for abolishing the Articles of Confederation which we started out under and going to the Constitutions was the fact that there was no practical way to make that kind of system work short of perpetual civil war.

Federalist #21:

• The principle of regulating the contributions of the States to the common treasury by QUOTAS is another fundamental error in the Confederation. Its repugnancy to an adequate supply of the national exigencies has been already pointed out, and has sufficiently appeared from the trial which has been made of it. I speak of it now solely with a view to equality among the States. Those who have been accustomed to contemplate the circumstances which produce and constitute national wealth, must be satisfied that there is no common standard or barometer by which the degrees of it can be ascertained. Neither the value of lands, nor the numbers of the people, which have been successively proposed as the rule of State contributions, has any pretension to being a just representative.

• It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess. They prescribe their own limit; which cannot be exceeded without defeating the end proposed, that is, an extension of the revenue. ... Impositions of this kind usually fall under the denomination of indirect taxes, and must for a long time constitute the chief part of the revenue raised in this country.

Federalist #34:

• Constitutions of civil government are not to be framed upon a calculation of existing exigencies, but upon a combination of these with the probable exigencies of ages, according to the natural and tried course of human affairs. Nothing, therefore, can be more fallacious than to infer the extent of any power, proper to be lodged in the national government, from an estimate of its immediate necessities. There ought to be a CAPACITY to provide for future contingencies as they may happen; and as these are illimitable in their nature, it is impossible safely to limit that capacity.

• ``A CONCURRENT JURISDICTION in the article of taxation was the only admissible substitute for an entire subordination, in respect to this branch of power, of State authority to that of the Union.'' Any separation of the objects of revenue that could have been fallen upon, would have amounted to a sacrifice of the great INTERESTS of the Union to the POWER of the individual States. The convention thought the concurrent jurisdiction preferable to that subordination; and it is evident that it has at least the merit of reconciling an indefinite constitutional power of taxation in the Federal government with an adequate and independent power in the States to provide for their own necessities.

Federalist #39:

• "The difference between a federal and national government, as it relates to the OPERATION OF THE GOVERNMENT, is supposed to consist in this, that in the former the powers operate on the political bodies composing the Confederacy, in their political capacities; in the latter, on the individual citizens composing the nation, in their individual capacities. On trying the Constitution by this criterion, it falls under the NATIONAL, not the FEDERAL character;"

 

Federalist #45:

• "The change relating to taxation may be regarded as the most important; and yet the present [Continental] sic Congress have as complete authority to REQUIRE of the States indefinite supplies of money for the common defense and general welfare, as the future [Constitutional] Congress will have to require them of individual citizens;

James Madison, Elliots Debates Vol 3 p128:

• "If a government depends on other governments for its revenues -- if it must depend on the voluntary contributions of its members -- its [*129] existence must be precarious."

• "If the general government is to depend on the voluntary contribution of the states for its support, dismemberment of the United States may be the consequence."

The normal condition under the Constitution was expected to be federal taxation of Commerce with the direct taxation of property & capitations to first attempted through state collections under emergency conditions.

The Records of the Federal Convention of 1787
(Farrand's Records)
James Mchenry before the Maryland House of Delegates.
Maryland Novr. 29th 1787--
Appendix A, CXLVIa, page 149, S9.

"Convention have also provided against any direct or Capitation Tax but according to an equal proportion among the respective States: This was thought a necessary precaution though it was the idea of every one that government would seldom have recourse to direct Taxation, and that the objects of Commerce would be more than Sufficient to answer the common exigencies of State and should further supplies be necessary, the power of Congress would not be exercised while the respective States would raise those supplies in any other manner more suitable to their own inclinations --"

 

The tax clauses of the Constitutuion as viewed in the first Supreme Court case the powers of Congress to lay and collect taxes (3 of the 5 judges in the court of that time were also delegates to the Constitutional Convention:

 

Hylton v. United States(1796), 3 U.S. 171

"A general power is given to Congress, to lay and collect taxes, of every kind or nature, without any restraint, except only on exports; but two rules are prescribed for their government, namely, uniformity and apportionment: Three kinds of taxes, to wit, duties, imposts, and excises by the first rule, and capitation, or other direct taxes, by the second rule. "

"the present Constitution was particularly intended to affect individuals, and not states, except in particular cases specified: And this is the leading distinction between the articles of Confederation and the present Constitution."

"Uniformity is an instant operation on individuals, without the intervention of assessments, or any regard to states,"

"[T]he DIRECT TAXES contemplated by the Constitution, are only two, to wit, A CAPITATION OR POLL TAX, simply, without regard to property, profession, or any other circumstance; and a tax on LAND."

[Taxman]

No state income tax in Florida -- we have a state sales tax, TYVM.

[Taxman]

LIEberal/Socialist/Marxist scare tactics will not work in the tax reform debate.

State sales tax agencies will oversee merchant collection of the NRST.

Go read the legislation and then come back to the debate -- it is very, very dangerous to enter into this debate unarmed, and you are unarmed, pal.

[Taxman]

"If you work for 80 hours a week, you only have to pay as much tax as you would normally working 40."

Not really -- under the Fair Tax, the taxes an individual pays would be dependent on how much said individual CHOOSES to spend on personal consumption.

Taxes under the Fair Tax regime have no relationship to earnings, only consumption. That is why is is called a "consumption tax."

[Taxman]

You will pay the Fair Tax only when you purchase a (new) item or service for your own personal use -- at retail.

The source of the income used to purchase said items is immaterial.

[Taxman]

Right you are, kevkrom. I call it the "tax cost of government," and it adds, on average, 25% to the retail cost of every domestic good and service.

Eliminate the corporate income tax and the Social Security/Medicare tax, and the price of US goods and services will decrease roughly 25%.

Your hypothetical retiree will have more spending power and realize a better standard of living under the Fair Tax.

[ancient_geezer]

I got some feedback from AFFT concerning how NRST candidates did for the election, they are generating a press release as we kibitz here. Their archivist promises me a copy of it shortly.

Meanwhile there was this little Novak ditty in the Union Leader chuckle:

The Union Leader and New Hampshire Sunday News
- 15-Nov-04 - Robert D. Novak
Democratic artillery shot duds at GOP

THE UNTOLD story from last week’s Republican victory was the ineffectiveness of the left’s attacks on right-wing reform. Democrats surprisingly did not launch a national campaign against partial privatization of Social Security. They did unlimber heavy artillery against radical changes in federal taxation but ended up shooting duds.

*** Snip ***

Steve Moore, the feisty free market economist who is Club for Growth’s president, concentrated on helping aggressive reformers Coburn and DeMint. Both had to wade through fierce Republican primary opposition and were not favorites of the GOP’s Washington establishment. The Oklahoma Republican power structure was aligned against Coburn, as was the House Republican leadership that did not remember him fondly from his congressional days. Speaker Dennis Hastert publicly dismissed Coburn as a probable loser in the same category as Alan Keyes, who finished 43 percentage points behind in Illinois.

Rep. Brad Carson, Coburn’s supposedly moderate Democratic opponent, blistered the Republican in debates for wanting to “privatize” Social Security. But in Oklahoma as elsewhere, the major thrust by Democrats assailed Coburn for considering a 23 percent national sales tax (part of a nationally coordinated mailing the last week of the campaign). The outcome: Coburn won by the landslide proportion of 12 percentage points.

In South Carolina, DeMint was as pure a free market candidate as possible in winning a seat held for 42 years by arch-protectionist Democrat Ernest F. Hollings. A free trader, DeMint fought off protectionist assaults, first in the primary and later in the general election by state Education Superintendent Inez Tenenbaum. But Tenenbaum, a popular Democrat in this prototypical red state, campaigned hard against the 23 percent sales tax and excited her party’s national strategists. The outcome: DeMint won by the landslide proportion of 10 percentage points.

The anti-sales-tax argument was pressed against Republicans all over the country, particularly state House Republican Leader Cathy McMorris in the state of Washington and former district judges Louis Gohmert and Ted Poe, running against redistricted incumbent Democrats in Texas. All were endorsed by the Club for Growth, and all won in landslides.