A FairTax Tale

I have a little scenario I would like to paint for those of you out there who just insist on finding something wrong with the FairTax. Admittedly, the FairTax isn't perfect. No tax plan is. How, after all, can you come up with a perfect way for a government to take its operating funds from its subjects? If you know an easier and more equitable way to do it, by all means, let me know!

I'm going to ask you to crank up your imagination for a moment here ... and by "you," I mean those of you who think that this FairTax thing is a bad idea and you're not prepared to come on board.

I want you to imagine a scenario. Don't worry about whether or not this scenario is possible .. Just accept it as I present it, and then consider the alternative picture I'm going to also present. Simple as that.

Let's imagine that the FairTax is the law. We've been operating under the FairTax since the day you drew your first paycheck. It's all you know. Here is your imaginarily "reality."

On every payday you get your complete paycheck. There are no deductions. If you earn $2,000 per week, you get a check for $4,000 every two weeks. You never have to save receipts or create any records pertaining to federal taxes. You can invest money without paying any taxes on it. You don't have to pay taxes on the money you earn through your investment portfolio. You pay no taxes on any money you put in your savings account. When you die you get to leave your entire estate, everything you own, to whomever you wish. The federal government will take no taxes from your estate. Your death is not a taxable event. When you go to the store to buy an item, and the price tag says $19.99, you will had a $20 bill to the cashier and get one penny back. The price tag is the price. There are four people in your household. You, your spouse and two rug rats. At the beginning of every month you get a check or a credit to your checking or charge card account in the amount of $506.00 to compensate you for the federal sales taxes that are included in the price of everything you buy; right up to the poverty level.

All in all .. not such a bad deal. You keep all of the money you earn and you get five hundred bucks a month from the feds. Plus .. you only pay taxes when you spend money.

Now .. .here comes some politician who has a grand scheme for a new tax system. He wants to explain it to you. Here's his great idea ..... give him a listen and tell us what you think.

The plan is simple. First the federal sales tax is going to be removed from the price of everything you buy. This will mean that everything will cost 23% less than it does now. But ... he's going to levy an income tax on every single individual and business who plays any role at all in bringing those products to the marketplace. These people and companies are all going to pass the cost of these taxes down the economic line to the final consumer of the products they manufacture. These taxes will end up embedded into the prices of products in our retail marketplace, bringing those prices right up to the current level. So .. no loss, no gain.

Next your political benefactor is going to take away your $500 per month prebate from the government. In its place he's going to tax every penny you earn. It doesn't matter where the money comes from. Your salary, your investment income, winnings at the track ... whatever you earn and however you earn it, it's going to be taxed.

Wait! He's not through. He's also going to tax your wages for Social Security and Medicare. He's going to try to soften the blow by telling you that your employer is going to match the taxes he takes out of your paycheck, but you're employer has made it clear that this money is all going to come out of the money he has budgeted to hire you. You'll probably lose out on your next raise while the boss his accounting in order.

There are some more nifty ideas in your congressman's tax reform plan. When you die your family is going to have to file a complicated estate tax return. A huge amount of the wealth you have managed to build during your life is going to be sent to the government. Your survivors may well have to sell the family business in order to come up with the money to pay for these death taxes.

One more thing .. you're going to have to keep records of all of your financial transactions. Every year you're going to have to spend no less than about 30 hours or spend hundreds of dollars to hire someone to fill out tax forms for you. If mistakes are made you will be hit with a huge penalty and interest. Oh .. and the government is going to have access to all of your financial records to make sure that you are paying everything you "owe."

The question, of course, is why does this politician want to change the tax system in this way? Power, that's why. They want to be able to enact little changes to the tax code that will benefit certain constituents ... which constituents will then benefit the politicians -- with money or with votes. Under the FairTax system these politicians have no power to favor one group of voters over another for the benefit of votes. The new system would give them that power.

Your choice, my friends. If we had the FairTax now ... would you be willing to make the switch?

What? You can’t handle the level of the debate and so you complain like a kid on the playground who doesn’t get his way?

LOL, level of debate. You don't even make a point.

The fact is that you have not backed up your claim. And as I said to be fair you can’t back it up because it is not capable of being supported. Now if you make unsubstantiated unsupported claims on such an important matter, then why should anyone give you the time of day?

I got more to back up my claims than a bunch of paid for whore economists. I actually have tons of experience actually making a living and running a business in the field. I know exactly what my compliance costs are and how much I can save by eliminating the income tax. And it ain't nearly what the so-called paid-for experts assume. What some dimwit paid-for 'expert' says who hasn't made an honest dime in his live says means nothing to me.

Here is all that people need to know about you: http://www.freerepublic.com/focus/f-news/1831865/posts?page=160#159

WTF is that suppose to mean? You can't dispute something so you just use some underhanded method to imply something is wrong with the post. What are you, the latest in the line of paid for posters from the fairtax organization. You wouldn't be the first on this forum.

I already made my point.

You made an absurd claim in Post #98:

http://www.freerepublic.com/focus/f-news/1831865/posts?page=100#98

to wit:
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New home sales will not be impacted at all. The NRST will be financed as part of the mortgage.

YOU-—>Whether it is included in the mortgage makes no difference.

The increase in monthly payments is more than offset by the increase in the paycheck.

YOU-—>So you are assuming workers will keep all the money so suppliers will not see those savings from the elimination of income tax? You do realize that means prices in labor, materials and supplies will not come down and will you add the sales tax on the end prices will go up?
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In these and other statements you have no backup and you display a gross lack of understanding of the subject matter.

You are a hack, a troll, a disruptor whose purpose is to create doubt. I and others know your game and it won’t work. Your attempts at creating doubt are no more that ‘gnats’ buzzing about the warhorse.

As I have said repeatedly you have no backup to your statements and you have been asked repeatedly to provide backup but you haven’t. Instead you are playing your usual game of trying to discredit the people that call you on your tactics and you are losing.

Of course you could end everything in your favor by backing up your statements but you won’t because you can’t. That means what you have to say is worth less than the stuff that gets dropped in the field by the bull everyday.

We are up to 183 posts in this thread now and you were asked in the middle of the thread to back up your statements and you haven’t. For my statements there is backup, for yours there is BS with an attitude.

Back to you. Let’s see you try again.

In these and other statements you have no backup and you display a gross lack of understanding of the subject matter.

I back it up more than you do. What kind of idiot can't understand that adding a 30% premium to new house when nothing is added to existing homes will effect the competitiveness of new homes and hurt their sales. The fact that you may be able to finance the 30% premium on a new home doesn't mean jack.

Troll? Give me a break. I am not the one who instigates personal attacks on every post. What a loser.

Your attempts at creating doubt...

He doesn't realize that doubt is a good thing when presented with a plan that double counts, obfuscates, and seems just plain too good to be true.

Doubt motivates one to think (a painful process for some), to question, and to do one's own research; it means taking responsibility over taking someone's word.

Peter Pan implores the children to clap their hands if they believe in fairies - its the only way to save Tinker Bell - no room for doubt. Hostage implores us to cast aside doubt and believe in the fairytax - its the only way his monthly check will appear in his mailbox.

Just as you have been acting on this thread since you were first challenged to back up your claim, you refuse to.

It’s simple mathematics and was outlined previously in my posts in this thread. Go back and read and you will find the key sentence that you said had no effect. It it has no effect, then show general calculations showing there is no effect and be sure to list your assumptions.

Specifically show what you claim that under the FairTax, a homebuyer who has the NRST added to the price of a home with both price and taxes financed in the mortgage, will not be able to offset the increase in monthly payments with the increase in take-home pay.

So why won’t you back up your claim? Because you can’t.

And for the umpteenth time I will expose your obvious slash and bash tactic, that when a detractor makes absurd claims without back up, not only is that detractor attempting to disrupt and hijack the thread into the direction of nonsense, but that disruptor is signaling they have no credibility, no basis for reasoned debate, and no capability to do research.

Fairtax takes effect 2010. You have two identical houses except one was originally built and sold in 2009 and one is brand new. The house built in 2009 is priced at $200,000 and is not subject to the fairytax. The house built in 2010 is also priced at $200,000, but the buyer must pay an additional $60,000 in sales tax.

In your 'reasoning' since the buyer will be able to finance the whole $260,000, the fact that the new house costs $60,000 more makes no difference. All I have to say is, what are you smoking? Anyone who is not brain dead would buy the older house for $60,000 less.

It’s simple mathematics and was outlined previously in my posts in this thread.

That is a complete lie. You haven't even done one calculation on this entire thread or backed up anything. All you do is spew bullcrap and insults. Typical lying SOB fairytax supporter. Nothing new here. How much does the fairtax organization pay your worthless butt to post? Whatever it is, it is too much.

The income tax taxes the productive more and rewards dependency. If you're over a certain tax bracket, you're also punished by being taxed more simply because other people pay little or no income tax at all. So yes, its a redistributive scheme. Which is exactly why politicians like the income tax - it allows them to do social engineering via the tax code.