Posted on 05/12/2005 7:46:54 PM PDT by Your Nightmare
Members of the President's Advisory Panel on Federal Tax Reform on May 11 expressed concerns over the FairTax national retail sales tax, a plan that has emerged as an alternative with a major grass-roots push.
Panel chair Connie Mack, vice chair John B. Breaux, and other members worried the plan would be difficult to enforce, would be regressive, and would require a high rate in order to take in enough money to fund the government.
Breaux raised concerns that the proposed 23 percent (tax-inclusive) rate would not be sufficient to raise the revenue necessary to fund the government. The Joint Committee on Taxation estimated that it would take as much as a 57 percent (tax-exclusive) rate to be revenue-neutral. Further, Breaux said he thought exemptions that would be carved out to make the sales tax progressive would also complicate it.
Mack, who raised concerns similar to his fellow panelists', said he was "intrigued" by the plan. "But if it's such a great idea, why haven't other political entities around the world pursued it?" he asked.
Americans for Fair Taxation Executive Director Tom Wright emphasized that the plan emerged after "thorough academic research" and "thorough polling" The strong grass-roots push has resulted in some of the group's 600,000 members appearing at each of the panel's hearings and has inspired a large comment-writing campaign to the panel in support of the plan.
Sales tax advocates were among the 20 witnesses who gathered before the panel for a full day of testimony on tax reform proposals. Although the group has held several other hearings in Washington and around the country, the May 11 meeting was its first hearing on specific reform plans since Bush appointed the panel in January. The panel has been charged with identifying tax reform proposals that are progressive, encourage charitable giving and home purchases, and are revenue-neutral. The proposals are due by July 31.
Among the tax replacement and reform plans presented to the panel were the value added tax, consumption-based tax, and the flat tax, as well as proposals that would use the current income tax as the foundation.
Witnesses generally claimed that theirs was the fairest, simplest, most flexible, most transparent revenue-neutral proposal that would improve economic growth and savings while meeting the president's criteria of encouraging charitable giving and home buying. Witnesses presenting consumption-based plans praised their overhaul as taking millions of low-income taxpayers off the rolls, being easy to transition to on a worldwide basis, and including safeguards to prevent new loopholes that would result in increased complexity down the road.
Tax reform panel members, who agree the current tax system needs to be fixed, grilled witnesses without revealing whether they will ultimately endorse a consumption- or income-based tax or a different mixture of the two.
This gets my vote for the most irrelevant post of the day! Way to go, Geez!
Hmmm,
1) the discussion since you seem to have missed it, is about the relationship between the NRST, an excise, producer prices (price without tax), and consumer price (price with tax included).
2) HR25 does happen to impose a Retail Sales Tax, a very definite EXCISE on the commercial activity/event of the sale of goods or services.
You really should familiarize yourself to the subject under discussion YN. That is the National Retail Sales Tax, levied as an excise at final sale for consumption.
Hmmm,Uh, an excise tax is a tax on specific goods. A NRST is not an excise tax. Haven't we been through this before?
1) the discussion since you seem to have missed it, is about the relationship between the NRST, an excise, producer prices (price without tax), and consumer price (price with tax included).
2) HR25 does happen to impose a Retail Sales Tax, a very definite EXCISE on the commercial activity/event of the sale of goods or services.
You really should familiarize yourself to the subject under discussion YN. That is the National Retail Sales Tax, levied as an excise at final sale for consumption.
I have, and it models both a flat tax (not Nightmare Flat of course since there isn't one) and an earlier form of NRST (not the FairTax) by replacing each of them in turn as the tax system replacement for the income tax and discusses the results.
The NRST comes out to be clearly the better of the two. I've corresponded with Prof. Jorgenson on the matter in past years and he pointed up the sales tax as the better of the approaches.
Not only does it show that prices drop, but that economic activity reesulting from the effects of the sales tax system kick off a dramatic economic improvement. And that is NOT a misunderstanding of the paper as Dr. Jorgenson expressed.
It's the price you pay for the items as discussed - the price of the thing plus the federal tax involved.
The state taxes are irrelevant to the discussion since it is the federal tax we are discusssion. You look up "total" since it can equally mean the defined thing we were discussing - which was the area limited to tax under the FairTax.
Or would you like to try to throw in the cost of your Grandmother's toenail clippers?
I'd say uyour #1175 beats it hands down with its eyes closed!
One uses a tax inclusive rate to calculate the amount of tax that is presumed included within final payment for goods or service such as that amount that must be tendered by the consumer in order to perfect his claim on products he receives.
Simply put it's exactly what HR25 dictates. The tax is "of the gross payment" and most people who have the slightest grasp of the english language understand that "of the gross payment" means it taxes everything "that must be tendered by the consumer in order to perfect his claim on products he receives" including other taxes, fees, excises included in a "gross payment".
I've corresponded with Prof. Jorgenson on the matter in past years and he pointed up the sales tax as the better of the approaches.Were you the one he was answering with cut and pasted answers from his papers? Maybe you could post some of you correspondence.
Not only does it show that prices drop, but that economic activity reesulting from the effects of the sales tax system kick off a dramatic economic improvement.The economic results of the Jorgenson/Wilcoxen model (particularly in the short term) are due to quirks in their models. They are far from realistic.
And that is NOT a misunderstanding of the paper as Dr. Jorgenson expressed.That prices can drop that amount without reducing nominal wages is a misunderstanding of Jorgenson's paper. His model is a full-employment model without restrictions on nominal wages. This allow wages to drop as necessary to keep approximately the same consumer prices as before the transition.
I'd say uyour #1175 beats it hands down with its eyes closed!Your lack of understanding does not make something irrelevant.
A NRST is not an excise tax.
ROTFLMAO, spin spin spin, turnaround and flop around.
An National Retail Sales Tax charged against any product for sale is an excise on that product of specific amount, measured proportionate to the sales value, of unit of product delivered by the seller.
Start over YN, you are stretching for the moon now. Amd your credibility is headed lower than ever.
The state taxes are irrelevant to the discussion since it is the federal tax we are discusssion.
You would like for everyone to beieve that but the federal tax we're discussing taxes payments not products and services, "gross payments" to be exact. And "gross payments" would include, among other things, state sales taxes.
Read the bill
`(b) Rate-
`(1) FOR 2007- In the calendar year 2007, the rate of tax is 23 percent of the gross payments for the taxable property or service.`(2) FOR YEARS AFTER 2007- For years after the calendar year 2007, the rate of tax is the combined Federal tax rate percentage (as defined in paragraph (3)) of the gross payments for the taxable property or service
The tax is "OF" the gross payment FOR, NOT "ON".
From memory, he expects prices to drop by 20 to 25 percent as a result of a tax like the FairTax.
He should start the trend now by reducing his wages by 25% to see if his idiocy works.
Following the Fairtax logic, the competition it would create would force all economists wages down at least 25% as well..
You think it'll work?
"You seem to miss the point that under the FairTax only end-consumption sales are taxed and not things used for or to produce consumer resales."
No, I fully understand the intent. I believe you're far to optimistic about the amount of rules, regulations, and definitions under the NRST.
The quickest way to get the overall level of taxation to be decreased? Term limits.
ROTFLMAO, spin spin spin, turnaround and flop around.
An National Retail Sales Tax charged against any product for sale is an excise on that product of specific amount, measured proportionate to the sales value, of unit of product delivered by the seller.
Start over YN, you are stretching for the moon now. Amd your credibility is headed lower than ever.
Really?
From The Columbia Electronic Encyclopedia:
excise taxes, governmental levies on specific goods produced and consumed inside a country. They differ from tariffs, which usually apply only to foreign-made goods, and from sales taxes, which typically apply to all commodities other than those specifically exempted.
From Investopedia:
Excise Tax: 1. An indirect tax charged on the sale of a particular good.
From The New Dictionary of Cultural Literacy:
excise tax (ek-seyez): A tax, similar to a sales tax, imposed on some goods, especially luxuries and cars.
From Wikipedia:
excise An excise is an indirect tax or duty levied on items within a country. It is an ad valorem tax on specific goods, or a fixed rate tax on specific goods, in this manner it differs from a general sales tax or value added tax.
Specifically, the gross payment as described in the clauses you cite CAN be interpreted to mean state sales and/or other taxes. Of course when the bill goes to the floor of congress there will be debate. Even before it goes to the floor there will be debate in the committee room and there will be write ups. To dwell on the semantics of the bill, which are moot at this point, is a waste of everyone's time when we should be debating the merits.
What else ya' got louie.
You pay sales tax on beer don't you? It's loaded with excise taxes. Show me a state sales tax law that is worded the same as HR 25.
Yes really:
All that is required for economic analysis of any product under a general sales tax, is to isolate the specific item being taxed. Just the application of the same rate accoss many products does not render the sales tax levied on specific item any less an excise, whether in economics or in law.
| http://star2.vub.ac.be/~dvermeir/mirrors/ingrimayne.saintjoe.edu/econ/government/ExciseTax.html Excise Tax:
|
Not to mention looking at the fundmental constitutional meaning of terms when applying them in the laws drafted in Congress:
Constitution for the United States of America:
"On every question of construction (of the Constitution) let us carry ourselves back to the time when the Constitution was adopted, recollect the spirit manifested in the debates, and instead of trying what meaning may be squeezed out of the text, or invented against it, conform to the probable one in which it was passed."
--- Thomas Jefferson
A LAW DICTIONARY
by John Bouvier, Revised Sixth Edition, 1856:
EXCISES. This word is used to signify an inland imposition, paid sometimes upon the consumption of the commodity, and frequently upon the retail sale.
I is nice to note that Retail sales tax excises sure seem to be the rage in Idaho, suspect they might have paid attention to the fundamentals both economic and terms of the Constitution:
http://www3.state.id.us/cgi-bin/newidst?sctid=630360019.KIdaho StatutesTITLE 63 REVENUE AND TAXATION CHAPTER 36 63-3619. IMPOSITION AND RATE OF THE SALES TAX. [EFFECTIVE UNTIL JULY 1, 2005] An excise tax is hereby imposed upon each sale at retail at the rate of six percent (6%) of the sales price of all retail sales subject to taxation under this chapter and such amount shall be computed monthly on all sales at retail within the preceding month. (a) The tax shall apply to, be computed on, and collected for all credit, installment, conditional or similar sales at the time of the sale or, in the case of rentals, at the time the rental is charged. (b) The tax hereby imposed shall be collected by the retailer from the consumer. |
The Attorney General of Kansas sure figures sales taxes are excises:
| 2000-052 10-5-2000 Kansas Attorney General Opinion http://www.kscourts.org/ksag/opinions/2000/2000-052.htm Article 11, § 5 of the Kansas Constitution provides that "no tax shall be levied except in pursuance of a law, which shall distinctly state the object . . . to which object only such tax shall be applied." The theory behind this provision is that if tax revenue is raised for a specific purpose, it cannot be diverted for other use.(1) It is arguable that the City of Sabetha is required to use the proceeds only for the purpose stated in Resolution No. 1991-6 which suggests that the revenue can be used for the "operation and improvement of its utilities." However, Article 11, § 5 applies only to ad valorem property taxes and not to excise taxes.(2) Ad valorem property taxes are taxes on the ownership of property and are levied on the value of the property.(3) An excise tax is a tax imposed on the performance of an act or enjoyment of a privilege.(4) Because a sales tax is a governmental charge for the privilege of acquiring property,(5) a retailers' sales tax is more in line with an excise tax and, therefore, it is our opinion that Article 11, § 5 does not apply. |
Seems some politicians sometimes actually listen to economists explainations of what an excise is before they engage the stroke of the pen. Neat Huh??!
You pay sales tax on beer don't you? It's loaded with excise taxes
I don't buy beer, but aside from that I don't pay 30% tax on or 23% of the gross of anything including my income.
What else you got?
http://star2.vub.ac.be/~dvermeir/mirrors/ingrimayne.saintjoe.edu/econ/government/ExciseTax.html Excise Tax:
Politicians may not be fascinated with the efficiency effects of taxes, but economists are. This section looks at how one can examine the efficiency implications of a simple tax, the excise tax.
An excise tax is a sales tax on a specific item. An excise tax can be a per unit tax or an ad valorem tax. The first is a fixed amount of tax per item, while the second is a percentage of the value of the item.
Hmm. "An excise tax is a sales tax on a specific item."
Not to mention looking at the fundmental constitutional meaning of terms when applying them in the laws drafted in Congress:
Constitution for the United States of America:
- Article I Section 8: "The Congress shall have power to lay and collect taxes, duties, imposts and excises,
to pay the debts and provide for the common defense and general welfare of the United States;
but all duties, imposts and excises shall be uniform throughout the United States; "
An irrelevant cut & pastie, from the Constitution, no less. You must really know what you are talking about.
"On every question of construction (of the Constitution) let us carry ourselves back to the time when the Constitution was adopted, recollect the spirit manifested in the debates, and instead of trying what meaning may be squeezed out of the text, or invented against it, conform to the probable one in which it was passed."
--- Thomas Jefferson
Might as well throw in another irrelevant cut & pastie from a founding father.
A LAW DICTIONARY
by John Bouvier, Revised Sixth Edition, 1856:
EXCISES. This word is used to signify an inland imposition, paid sometimes upon the consumption of the commodity, and frequently upon the retail sale.
"the consumption of the commodity" Do you know what a "commodity" is?
I is nice to note that Retail sales tax excises sure seem to be the rage in Idaho, suspect they might have paid attention to the fundamentals both economic and terms of the Constitution:
http://www3.state.id.us/cgi-bin/newidst?sctid=630360019.K Idaho Statutes
TITLE 63 REVENUE AND TAXATION CHAPTER 36
SALES TAX
63-3619. IMPOSITION AND RATE OF THE SALES TAX. [EFFECTIVE UNTIL JULY 1, 2005]
An excise tax is hereby imposed upon each sale at retail at the rate of six percent (6%) of the sales price of all retail sales subject to taxation under this chapter and such amount shall be computed monthly on all sales at retail within the preceding month.
(a) The tax shall apply to, be computed on, and collected for all credit, installment, conditional or similar sales at the time of the sale or, in the case of rentals, at the time the rental is charged.
(b) The tax hereby imposed shall be collected by the retailer from the consumer.
You had to go to the Idaho State Statutes to find someone who agreed with you! LOL!
The Attorney General of Kansas sure figures sales taxes are excises:
2000-052 10-5-2000 Kansas Attorney General Opinion
http://www.kscourts.org/ksag/opinions/2000/2000-052.htmArticle 11, § 5 of the Kansas Constitution provides that "no tax shall be levied except in pursuance of a law, which shall distinctly state the object . . . to which object only such tax shall be applied." The theory behind this provision is that if tax revenue is raised for a specific purpose, it cannot be diverted for other use.(1)
It is arguable that the City of Sabetha is required to use the proceeds only for the purpose stated in Resolution No. 1991-6 which suggests that the revenue can be used for the "operation and improvement of its utilities." However, Article 11, § 5 applies only to ad valorem property taxes and not to excise taxes.(2) Ad valorem property taxes are taxes on the ownership of property and are levied on the value of the property.(3) An excise tax is a tax imposed on the performance of an act or enjoyment of a privilege.(4) Because a sales tax is a governmental charge for the privilege of acquiring property,(5) a retailers' sales tax is more in line with an excise tax and, therefore, it is our opinion that Article 11, § 5 does not apply.
"a retailers' sales tax is more in line with an excise tax" You read this to say a sales tax is an excise tax? If a sales tax is an excise tax, why was it even a question?
Good night YN. Dream on in you delusions. LOL
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