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.
Have you read through it?
First of all there is no such thing as your "50% of this room who don't pay any income tax". Even if you do not file tax returns and do not have an employer who witholds payroll taxes from your wages you STILL pay taxes. You just don't know it.
Taxes increase the prices of everything you buy by from something like 20 to 40%. That's precisely what the pols hope for - that the citizens are so ignorant that they do not realize they are greatly taxed sub-rosa. Attitudes like that make you dead meat for the politicians and their control of your lifestyle by tax laws.
You might read the comments of Beardsley Ruml who implemented the withholding taxes for FDR - and this was in 1946:
http://www.freerepublic.com/forum/a374819d77888.htm
You should also realize that repealing the 16th (which IS called for by the FairTax bill) is not "impossible" to pass at all. Once the FairTax becomes law and the IRS is abolished (2 things which the bill does once it is law) there is no function served by having a mechanism to re-institute an income and - in fact - the citizens by and large would not allow it once they have tasted the tax freedon offered by the FairTax. The 16th, then, will be an anachronism and fairly easily repealed. Remember Prohibition ant the repeal of its amendment.
Pols have as Job #1 their own re-election and with a stirred up populace they are not so courageous at to buck a widespread trend of that sort. That's how Prohibition was repealed ... grassroots support for its repeal.
You merely assume you are defeated before you start. You're not. Read up on the FairTax bill, contact your congresmen and let them know you want "fini" written to ANY FORM of income tax.
But those figures do not count the hidden, embedded taxes that have been embedded into the cost of everything we now buy.
Everyone gets hit with that taxation and no one knows ezactly how much it really is, but it is substantial.
Pols have as Job #1 their own re-election and with a stirred up populace they are not so courageous as to buck a widespread trend of that sort. That's how Prohibition was repealed ... grassroots support for its repeal.
Well, the grassroots support for the FairTax is growing all the time and this can be observed by reading the comments to the President's Tax Panel. An awful lot of those commenting specifically identify the FairTax as the desired tax plan.
People doing a bit of reading of the bill itself and reading some of the informative material on the FairTax website is also helping.
I'm not talking about federal revenue but merely saying that you don't have the entire picture as prices we pay are inflated by cascading taxes embedded into the price of things we buy - over and above what might be sent to the IRS as income tax.
Your numbers measure income tax and I'm merely saying that is not at all the entire picture of what our government tax system costs us. I realize your numbers quantify tax income to the feds, but that's only part of the burden we bear.
Do you know who David Gale is? Maybe you could clue me in.
Someone to watch out for, should he ever collaborate in stirring up a troublesome VAT with Bruce Bartlett.
Thanks for the ping!
Yea i read it sounds like they are fishing for a way to make sure the government gets more than their fair share while leaving us still hoding the bag !
"I can't infer when I write to you, ...
What prevents you from imferring when you write? Does the inference portion of your brain shut down when you write? What are you implying with this anyway?"
If you go back and look I was agreeing with you. The "I can't infer..." should have been in quotes as someone else wrote it. Sorry for the confusion.
"I told the other geek that I wan't going to pursue the issue with him"
You already did. ;-)
I appreciat your input. Perhaps it might be clearer to say theat I'm not pursuing it any further with he.
He's got his word use and i've got mine - and never the twain shall meet. It's merely a side issue that is off-track to the thread topic.
If there is a better plan for doing that out there let's hear it. I must tell you however that, although I have been doing this for years and years, thus far I have heard of no such plan but only sniping from nay sayers with nothing at all to offer.
300 posts, didn't look to see if you'd been here.
"But if it's such a great idea, why haven't other political entities around the world pursued it?"
WTF? So now not only do our judges turn to foreign law, but our policy makers turn to foreign policies? We really are screwed.
The FaurTax helps there also. Just search this thread for Sec, 905 information.
Of course you are - if you think that they'll pass along any savings out of the goodness of their hearts! But that's not the case - they'll have to pass the savings along (in any competitive industry) to survive.
And your explanation doesn't answer the amortizing the 23-30% tax on a new house. A person would pay 3,4+ times the tax over a 30 yr. period.
Why would they pay more than now??? Today's prices include fed tax and tax costs amounting to 25% or so of the total price. The same will be true under an nrst. No difference in the amount of tax paid at home purchase, but big difference in whether you see 25% of the price as tax. Now, you clearly do not - hence your misunderstanding of this point. Under the nrst, it must be itemized on eery receipt "Federal Tax 23%". A home today that costs $100,000 already has about $25,000 of fed tax and tax costs in the price. Without those taxes, the home would be $75,000. Under the nrst, those fed tax and tax costs are eliminated, then prices fall because housing is a competitive industry, then add the nrst and the price is back to $100,000. No change.
The one thing I find attractive is that many people that now pay no tax would pay some, or would they?
Yes. Like a pizza party with 18 people costing $90. Our current situation is like the pizza party with 9 of the people paying. That would be $10 each (for those paying). Of course those that don't pay wouldn't like to reform the pizza party paying plans. But if they ALL paid each could pay $5.
What with some sort of 'rebate' check from the gov every month.
Yes the rebate goes to any US resident with a valid SSN who wants it. Analogous to today's standard deduction, it exempts a certain level of spending from taxes.
This has the net effect of reducing marginal rates on those who spend less. But everyone would still have to pull green money out of their pockets at purchase time - they'd feel the pain of taxes still.
Roth IRAs. Well under today's system the withdrawals are tax free until you spend them - at which time 25% of the price is actually fed tax and tax costs. Under the nrst, EVERYTHING is a roth - and you pay 23% of prices as fed tax.
There's no more taxing roths under an nrst than now. Indeed, all savings grow tax free under the nrst - not just special roths...and there is no penalty for untimely withdrawal.
http://www.fairtaxvolunteer.org/smart/faq.html
But those figures do not count the hidden, embedded taxes that have been embedded into the cost of everything we now buy.
One hundred percent (100%) of taxes collected from all sources doesn't include all taxes?...More fairtax math.
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