Posted on 04/26/2006 8:29:38 AM PDT by Eaglewatcher
Americans are disenchanted with the federal income tax system. And why not? Only accountants and agents of the Internal Revenue Service understand the 8 million words on the 60,000 pages of the complex Tax Code. Given some of the horror stories over the years about conflicting interpretations from one IRS office to another, even that assumption is suspect.
According to an Ipsos Poll, eight out of 10 people recently surveyed think the system is unfair. Indeed, the only clear common ground for agreement between the various income groups in the poll appears to be their unhappiness. And they are echoing the sort of complaints heard a year ago when Uncle Sam held hearings on simplifying the code.
Any tinkering with the current system by Congress likely will be perceived as political manipulation in response to pressures exerted by special interests. For despite congressionally mandated, administration-recommended reforms, the code remains cumbersome and intimidating, complete with social engineering breaks and loopholes. So why not eliminate the unfair, distrusted and generally despised code and replace it with something far more equitable and efficient and less labyrinthian like the FairTax.
Taxpayers wouldn't have to worry about being audited by the IRS or making mistakes on their income tax forms. Gone would be corporate taxes, self-employment taxes, gift taxes, estate taxes and capital-gains taxes as well as the income tax. Yet, the bottom line for federal revenue would remain the same.
Everyone would contribute to the national sales tax. Collections would be made at the point of purchase. A system of monthly rebates could be set up for the poor making less than a federal income threshold. Much of the paperwork required by the IRS would simply disappear, replaced by sales tax collection forms. Such efficiency and simplicity would be an economic spur.
One would think that politicians whose jobs depend on being popular with voters would leap at the opportunity to get rid of the disliked tax code. Some day, they will.
Awwww - what's a little order of magnitude error among friends??? Can't a guy have a bit of phun???
'Deed it don't!!!
Guess you've never read the WSJ. The FairTax has been favorably editorialized there more than once.
Don't try to say I called the Joplin Globe the WSJ since I did not. But I guess you're comfortable with your litle untruths like so many of your cohorts.
That leaves 65% of taxe revenue to be devoted to general revenue, not 33%.
As for the flat tax, I would argue that it is worse than both our graduated income tax and the nrst at reducing purchacsing power of after tax money.
The flat tax presents the same "double" taxation problems as our graduated income tax plus others. In fact, the flat income tax is a type of Value Added Tax (VAT)..specifically, it is a subtraction method VAT.
As you should be, IMO. However, amendments cannot accompany a bill. Admendments must be stand-alone.
The next question is usually why not repeal 16th first? ANother good question, but one that has been gone over for decades. The final disposition of this is that nobody will repeal the 16th without a viable source of revenue in place.
That's how we got here.
People under 15 buy things - not as much I'm sure - but why not include them to a certain degree?
Whatever number you choose to use, it must also include illegal aliens' spending, criminals' spending money on legal transactions, and foreign tourists. And illegals will always pay the max rate.
Let's assume you spend 100% of what you earn, and you earn $100. Under the present system SS/MC receives $15.30. Under Fair Tax you receive and spend your entire $100. You get $81.30 worth of merchandise and pay $18.70 in Fair Tax. SS/MC still needs $15.30 out of your $100 of gross earnings, so this leaves $3.40 to cover what presently is generated by income tax, which equates to a 3.4% federal income tax rate. If you are paying 3.4% federal income tax then, yes, please educate me. My original point was that 23% will not result in a revenue neutral plan. The percent will need to be much higher.
Let's assume you spend 100% of what you earn, and you earn $100. Under the present system SS/MC receives $15.30.
Not all that people earn is subject to SS/MC tax in point of fact, half of all income earned in the nation is not liable for those taxes. This is due both to the $90k cap on taxation of wages, and the fact that only wages and self-employment income is even subject to the tax to begin with.
The average SS/MC tax rate paid with respect to total household income is actually closer to 8.4% according to CBO which is much closer to the AFT allocation than your superficial calcualtion that presumes all income is wage income less than the $90k cap.
If gov't needs 15.3% of wages, it does not mean that gov't needs 15.3% of consumption. Obviously, if the amount of wages being taxed is different than the amount of consumption being taxed then the proportion that must be tax can differ.
If, for illustration, the wage base is $100 and the gov't needs $15.30 to pay SS, then the tax on wages would have to be 15.3%.
If, however, the consumption base of $200 is used, then a rate of 7.65% on consumption will raise the reuired $15.30.
This is trivially obvious and I'm beginning to think you're playing games.
In addition, to show how far off base your reasoning is, here's a link to show how the FairTax is actually revenue neutral.
Maybe it is you who should read more closely, and then think on what you've been reading? Capital gains are currently taxable at 15%, capital cost basis at 0% [already taxed] - and you would like to tax them both at 23%. My point was - exclusively - the double taxation, in this particular case of the capital cost basis.
Well, I think you're wrong - Man50D doesn't want to tax anything.
Beyond that, what specifically are you asserting that the nrst will double tax to an extent greater than now?
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