Posted on 12/18/2005 4:46:00 PM PST by FairOpinion
YES! 83% (8832 votes) A consumption tax would be great for the American economy. Do away with complicated income taxes!
NO! 17% (1761) A consumption tax would not be fair for low-income households. Keep the current income tax system!
We'll send your vote to your congressional representative and senators.
I accept your correction regarding equilibrium prices. Thanks.
I didn't say the latter.
You're backpeddling pretty swiftly into an unimportant, unrelated detail.
More obfuscation. He's the only one in his discussions that has been arguing whether income tax is or is not designated as production. The FairTax proponents have not entered into that debate. Instead the've been explaining how and why income taxes are considered in pricing.
You previously said that income taxes have no effect on decisions wrt pricing a product. Not saying that anymore, eh?
He'll likely proclaim he never argued that. This thread is on record and proves the opposite.
http://www.freerepublic.com/focus/f-news/1543053/posts?page=322#309
Yes you did. Are you now changing your mind, again? Did you say income taxes affect prices before you didn't say it? / Kerryspeak
I don't know what you believe you are seeing but that is nothing like what you claimed I said.
One of the reasons it's important is that a company has a certain degree of freedom it may enjoy in pricing near the equilibrium price. One of the things that affects that decision is the desired return. Return is affected by all expenses, even anticipated income taxes. Hence it is the case that anticipated income tax costs are considered in pricing.
From there, it is trivial that prices include a component representing anticipated income tax costs.
That being said, the overall cost of our tax system in prices has business income taxes as only one component - not even the largest.
Payroll taxes, compliance costs, and decisions that reduce production based on tax consequences cost far, far more.
Much of the literature says that our tax system adds +/- 28% to prices of goods, and adds 33% to service prices.
When the existing tax costs are eliminated and the 30% nrst is added at retail, prices remain stable.
You can simply go to the link provided, or scan the thread to see the number of times you claimed that since business income taxes are not a "factor of production", they cannot then affect price.
I'll let readers decide for themselves. I am pleased that you have seen the light on that issue.
Who knows. I just know that his attempts to bend accounting and economics to fit his animus for the FairTax are laughable.
Framing the debate. A debate that he alone has argued and implies in his responses that the person he is responding to is engaged in his framed debate. It is IMO, without out doubt, intentional.
justshutupandtakeit:I don't know what you believe you are seeing but that is nothing like what you claimed I said.325
He said that you have put forth the argument of whether income taxes are or are not a cost of production. See below for the record.
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To: justshutupandtakeit
I have neither backpedalled nor changed my comments.
Well, what do you call it when you swear up and down that "income taxes are not considered in pricing" - then you change to say, "well, uhmmm... income taxes are not a factor of production" - which was never in question anyway? ROTFLMAO. 320 posted on 12/23/2005 12:01:30 PM EST by Principled
I didn't say the latter. 322 posted on 12/23/2005 12:18:50 PM EST by justshutupandtakeit (Public Enemy #1, the RATmedia.)
http://www.freerepublic.com/focus/f-news/1543053/posts?page=322#309 324 posted on 12/23/2005 12:21:20 PM EST by Principled
To: phil_will1
To: Principled
I don't know what you believe you are seeing but that is nothing like what you claimed I said. 325 posted on 12/23/2005 12:25:44 PM EST by justshutupandtakeit (Public Enemy #1, the RATmedia.)
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Class envy?
Hatred for the rich?
Why would you punish the rich or any other class of people?
Is it easier for you to reap the rewards of someone else's labor than your won?
I don't understand your motivation for using the force of government to punish someone whose efforts made them successful.
Would you be kind enough to explain?
i had some of the same thoughts.
Why would someone want to exempt necessities taxes from some but not others?
Well, at least it's easy to forego your rebate of necessities spending under the nrst - so anyone who chooses not to receve it may do so quite effortlessly.
Alternatively, they may donate it to FR!
Thank You Principled.
I've not followed this thread...but I assume from your post that there are questions with respect to the estimated reduction in prices. While I doubt that prices will drop the full amount of the tax, I am confident that return on investment and wages will rise so that purchasing power remains constant.
The revenue neutrality of the FT assures that the government takes no more from the economy that it currently takes....therefore the purchasing power of the American people as a whole is unchanged. The question then becomes, who will be better off and who will be worse off??? Those currently living from tax free sources, like tax-free muni-bonds, illegal income will see a reduction in their purchasing power....but those living at or below the poverty level will see an increase. Middle income folks will probably remain about the same.
As capital flows into the American economy, all will benefit from increased economic opportunity. Currently, the US has the highest Corporate Net Income Tax in the OECD. This is suffocating our economy. Please see: http://www.taxfoundation.org/publications/show/1175.html
When you consider this fact in commbination with the WTO ruling which says we can't border adjust our prices to remove the tax component (They call that an illegal export subsidy), but the VAT of Europe is fully border adjustable......it's a miracle that we have any jobs left in this country. That is testament to the productivity of the American worker.
The FairTax will completely remove this obstacle to American prosperity....and remove this tool of manipulation from the WTO. This border adjustability argument has been going on for about 30 years and is responsible for a great deal of machination....machination that keeps tax attorneys fully employed and kept Congress busy writing the American Jobs Creation Act of 2004 to vitiate the demands of the WTO. Please see: http://waysandmeans.house.gov/Media/pdf/hr4520/hr4520summary.pdf
All the talk about prices and wages really just muddies the water and distracts from the fundamental economics which should be driving the discussion: A revenue neutral tax that IS border adjustable will propel this economy into orbit and bring jobs back to our shores....that's the untold story.
Had I said something should be done about people who get rich by insider trading or stealing jewels, would you have called that envy?
I don't understand your motivation for using the force of government to punish someone whose efforts made them successful.
The mistake in yor logic is to assume that your someone became rich through his own efforts.
Were it so, then his efforts must improve exponentially in proportion to the growth of his wealth--else in a fair system, how could he earn so much?
I have never heard of any such superman.
Rather, the very rich become so by accumulating so much money, that the money increases their ability to earn even more, which in turn enables them to earn more still.
Providing they do not do incredibly stupid things (most peole wll), there is nothing to stop this acquisition of wealth coming in to them--and not because their "efforts" are of themselves so worthy.
A revenue neutral tax that IS border adjustable will propel this economy into orbit and bring jobs back to our shores....that's the untold story.
That, albeit from a negative view approach, has occupied my thoughts overnight and into today.
Recalling a congressman that put forth the argument/explanation that for the government to continue collecting revenues in the future, knowledgeable that revenues will increase, the income tax system will not permit it. Probably in reference to the Leffler curve. He went on to say that an NRST with a much broader base that allows the economy to grow, expands revenue collection and with increased economic growth comes increased tax revenues without increasing the tax rate. Whereas taxing production works against that.
Two very important issues. 1) government barrowing money to pay the bills and, 2) the trade deficit/gap.
Enter the FairTax or similar NRST. Three critical issues: 1) it's not a matter of if, but when an NRST will be implemented. 2) If a major industrialized country gets a head start on the United States by being the first to implement a NRST such as the FairTax, the US trade deficit/gap will widen. 3) If 2 happens the available monies to borrow to make up the federal government shortfall will go into decline.
The first major industrialized country that replaces their tax system with a consumption tax system will take the lead in new job creation and economic opportunities/growth.
In order for foreign governments to retain their present level of tax receipts they'll have to replace their outdated, economy-draining tax systems with a consumption based sales tax.
The USA can lead the way to honest economic freedom and financial privacy the world over -- beginning with it's own citizens.
With outsourcing by American based companies, many of which are also building new manufacturing plants in foreign countries it would only deepen the trade deficit if a major first world country beats USA to the punch by implementing a consumption based sales tax first. That country would get the new jobs and USAs trade imbalance would widen.
It's not a matter of if consumption-based sales tax will gain dominance the world over, but when, and which country will lead the charge and which countries will play catch up.
The United States has taken the lead in the international fight against terrorists. An important advancement in eliminating the negative/terrorists is to create the opposite -- create economic opportunities -- seed economic freedom the world over. The FairTax is just the tool to do that.
The United States must take the lead. Both houses of congress must get this message.
Your pronouncement was to punish the rich and you made no distinction for who qualifies as rich, how long they have been rich, or how they accumulated their wealth. You are adding criminal activity now that you didn't mention before.
Retaining inherited wealth can be a job unto itself because so many do lose it all because of one stupid thing or another. But passing on one's wealth is a very sound capitalist idea. Confiscating it through taxes is not.
I may not like what some do with their money, but it is not my money and I have no right to it nor any just claim to it through taxation.
You still sound envious to me or holding a grudge, but if you want to avoid such misinterpretations in the future, I'd suggest that you be clearer when you post.
I would be in favor of the government taking it all, and letting the litte brats learn how to earn it for themselves (which would be the best thing for them), but there are complications, for example, a home or family farm should remain in family hands should the family wish it so; or the case of a disabled child who could not support himself, etc.
Punish? I do not consider it punishment, any more than requiring someone to return what is borrowed or stolen.
I would hold a grudge against any who gain through unfair behavior or an unfair system.
I would be in favor of the government taking all your hard earned money. /sarc
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