ANOTHER UNINFORMED FAIRTAX CRITIC

Nelz Nuze ^ | May 6, 2009 | Neal Boortz

[Turret Gunner A20]

... and this time it's none other than Dave Ramsey. The FairTax is a bold proposal. It is only natural that people are going to try to criticize it. Is it too much to ask for these people to do at least a modicum of research so that they at least appear to know what they're talking about?

This time the culprit is Dave Ramsey. I like the guy, and I like his approach. His sermons on living debt free are right on, and no doubt he's helped millions of people to improve their financial. OK .. mighty fine. But now he's taken it upon himself to opine that the FairTax simply isn't, in his words, "fair."

Let's take this quote from Ramsey's article: "People would only pay taxes on items they buy, except for food, basic clothing and other kinds of necessities." Most of the FairTax supporters know that this is just flat-out wrong. The explanation is incomplete.

If Ramsey really was informed on the FairTax he would know that you pay taxes only on items that you buy at the retail level, and that food, basic clothing and other kinds of necessities are included. Ramsey would also know about the prebate. He would know that every household in this country --- that is, every legal household --- would get a credit or check from the Treasury Department every single month equal to the FairTax they would be expected to pay on the basic necessities of life during the following month. This FairTax prebate is so essential to the FairTax plan that to ignore it, or to be unaware of it entirely, is worse than careless.

Ramsey also writes of the FairTax "This means it's more of a burden on poor people, because they would pay a higher percentage of their overall income."

Sorry, wrong. The poor, poor pitiful poor would pay virtually nothing - zero percent of their income - to the federal government. [ALERT! Brilliant thought follows!] To pay any taxes at all to the feds the poor would have to spend above the poverty level. If they're doing that ... they're not poor. Pretty easy, isn't it?

I wonder why Dave Ramsey doesn't get it? Is there a chance he just shot from the hip here without doing any real research? The FairTax deserves better than this flippant, uninformed treatment.

Dave Ramsey could be a good proponent of the FairTax. He's very bright, and he would recognize the beauty of this plan if he just would take the time to actually study it. Knowing what you're talking about .... Is that too much to ask?

Weird, this audio clip on YouTube seems to show Ramsey supporting the FairTax. Huh. Maybe he's lost changed his mind since that was recorded.

[Principled]

LOL what is petty and stupid?
- pointing out an error in scamel’s posts
- scamel calling someone petty and stupid?

sigh...

[Recovering Ex-hippie]

Excellant point!

they have a house/condo, cars, and tons of junk in the house that isn’t worth much (ha..I’ve been unloading stuff now for two years!)and pretty much streamline in later years.

[Recovering Ex-hippie]

right now...NO ONe knows how much they are getting taxed...look at how people squeal if you want to tax their beer now!

[Recovering Ex-hippie]

boortz is just pointing out that there is soemthing else going on...its ego and ratings with the Talk show guys..He has said, if he hadn’t endorsed the Fair Tax, the others would have jumped on it!

I like dave Ramsey but he isn’t the ONLY answer to everything.

[Recovering Ex-hippie]

Of course, the taxes are embedded...you pay tax on all the supplies the contractor uses, his workmen’s comp taxes, etc payroll taxes!

[Recovering Ex-hippie]

You really don’t understand taxes do you?!!

You got taxes you paid BACK? DUH. and who kept the money for that time?

[Recovering Ex-hippie]

Xcamel provides no logic..just wild eyed comments. ha,.

[higgmeister]

Fairtax is a joke, and financially educated people know it.

Your comment is the real joke because "Financially educated people"
have innumerable times brought misery and ruin to the rest of US!

The IRS is the blight on the soul of America!

Let's try common sense and reason for once.

The Fair Tax can become our Salvation!

[KarenMarie]

I went to that site and used their calculator for two different scenarios. Based on the same income, a married person with 2 knds would get money back. A single person with no kids would pay more.

Is there any tax system on the planet that does not penalize some, in favor of those who use more resources?

[Principled]

If you’re talking about the fairtax site’s calculator - it is poorly designed in that you have to FIRST go near the end to fix your assumptions - then run the numbers - for it to make sense.

[KarenMarie]

I cannot claim to be an expert om the FairTax.

May I just ask you this...

If one man is single, has no children and makes $75,000 a year... will he pay more, less or equal taxes to a man who has a wife & 2 children who makes the same amount?

Thanks.

[Principled]

No worries KarenMarie.

Your question cannot be answered as written b/c the nrst is not based on what you earn. It is based on what you spend.

The single guy will pay the nrst after appx $10,000 of tax free spending per year. How much he ends up paying depends on how much taxable stuff he buys. His max tax would be $14950 if he spent everything on taxables.

The family will pay the nrst after appz $17000 in tax free spending per year. How much this family ends up paying depends on how much taxable stuff they buy. Their max tax would be $13340 if they spend everything on taxables.

The family has higher necessity spending so they have a higher threshold to cross before they pay. Of course, there are a lot of things that will reduce the amounts. You can take a look here http://fairtaxcalculator.org/ for more complete information.

[Man50D]

Why? Has it changed since the last time I read it?

Then you realize any form of tax on productivity is communistic.

It is still taking money from the pool of successful people and giving it free to the pool of unsuccessful people.

That is socialism.

It's taking money from anyone who decides how much and how often they want to be taxed when they choose to make a purchase. Our communist style tax system doesn't afford the taxpayer any choice. Taxing consumption is not socialism.

Under the "FairTax" the savings will be taxed (again) when spent.

My savings, such as they are, have already been taxed in full. Upon implementation of the "FairTax" they would be taxed again.

Your savings are taxed multiple times with every purchase with the embedded taxes. The short term situation of being taxed again will be more than offset by the elimination of embedded taxes, the 30% reduction in the overall tax burden and the increase in purchasing power.

For that reason alone I cannot support the FairTax as currently written.

Then you are opposing it on a fallacy.

More FT faux math.
I noticed you conveniently ignored answering my question from the previous post (Based on what data do you make such an otherwise vague and empty claim? ) with another empty remark that fails to realize the math is based on years of study by several economists. What is your answer to my original question? What facts do you base your faux math remark to refute my figures?

The FT rate is designed to be "revenue neutral." That means that the government is still stealing exactly the same amount that it always has.

Then repeal Article 1 Section 8 of the Constitution that gives power to levy and collect taxes but until then there will be a tax system. It's far better to consumption than a communist supported tax on productivity.

[Principled]

Well, I’m guilty of FWGC. Freeping w/ granchildren.

So my last post is hard to follow and I may have misread your question.

The answers I gave applied to a single man w/ two kids. A married couple w/ two kids spends appx $27000 tax free. So this married fam of four would pay max of $11040 if they spend everything they earned on taxables.

[KarenMarie]

Thank you for replying.

so, the single guy ends up paying more taxes for using less services, right?

they dont start paying taxes until after the first $17k and then max out at $13.3 for using more schools, more trash collection and etc.

But the single guy who has no children, doesn’t use the schools, needs less trash collection and other community services has to start paying taxes after the first $10k and will max out at approx $15k

If you don’t mind me asking, please... with the greatest of respect...

what is so fair about that?

Thank you.

[Principled]

Well, I don’t say it’s fair. What tax is?

But I don’t think you understand that the tax is based on spending, not income. Further, the nrst is to replace federal taxes - not state or local taxes [like schools.]

If any individual spends a lot on retail, they’ll pay more - irrespective of whether they use school or roads.

[KarenMarie]

“If any individual spends a lot on retail, they’ll pay more - irrespective of whether they use school or roads.”

yes, but the single guy has to start paying taxes after $10k while the married ppl did not have to pay taxes until after $17k, right. This tax money goes to community services, no? ( I understand that these numbers are approx and not exact)

And what is this rebate thing? The guy at the tea party was going on about rebate checks that families with children and ppl who dont earn a lot get... that the single guy is not entitled to.

:)

[Man50D]

A change would need to be made but not to Article 1 section 8. The first paragraphs ends with “...but all duties, imposts and excises shall be uniform throughout the United States; “. This could be easily accomplished by taking the prior years SPENDING, dividing it in half, apportion one of the halves to the Senate and each seat in the Senate and then do the same for each seat in the house. Any state that does not pay it’s bill and is not current with it’s accounts does not have their votes counted in Congress until such time as they are current.

A repeal is necessary as the power to levy and collect taxes is expressly cited in Article 1 Section 8 and a new Section would need to be written excluding Congress that power.

Americans For Fair Taxation supports concurrent legislation(House Joint Resolution 16)to repeal the 16th Amendment. In fact with The Fair Tax Act is a provision addressing repealing the 16th Amendment.

They would need to be considered as separate pieces of legislation each one requiring ratification by three fourths of the state legislatures and of two thirds of each chamber in Congress. That will be far more difficult to pass then repealing the 16th Amendment and a majority vote on The Fair Tax Act.

[Filo]

Then you realize any form of tax on productivity is communistic.

As is any redistribution of wealth such as the prebate.

It's taking money from anyone who decides how much and how often they want to be taxed when they choose to make a purchase. Our communist style tax system doesn't afford the taxpayer any choice. Taxing consumption is not socialism.

Redistributing wealth is.

As is taxing to support socialist programs.

Your savings are taxed multiple times with every purchase with the embedded taxes. The short term situation of being taxed again will be more than offset by the elimination of embedded taxes, the 30% reduction in the overall tax burden and the increase in purchasing power.

Nonsense all around.

The government is still providing exactly the same drag on the economy, all you've done is change the shape of the anchor.

There is no reduction in tax burden. The only reduction is a slightly smaller compliance cost.

There is no increase in purchasing power.

Again, the government is taking exactly the same amount of money (productivity) out of the economy. That is what revenue neutral means.

Then you are opposing it on a fallacy.

Nope. I understand perfectly and I've already beat you down by doing the math and demonstrating the reason many months ago.

I noticed you conveniently ignored answering my question from the previous post (Based on what data do you make such an otherwise vague and empty claim? ) with another empty remark that fails to realize the math is based on years of study by several economists. What is your answer to my original question? What facts do you base your faux math remark to refute my figures?

As stated above, the tax is revenue neutral so the overall tax rate does not change. The government still swipes the same amount of productivity and all you've done is shift the burden somewhere.

Then repeal Article 1 Section 8 of the Constitution that gives power to levy and collect taxes but until then there will be a tax system. It's far better to consumption than a communist supported tax on productivity.

Actually, A1S8 aside, most of the current income tax is already illegal since there is no provision for wealth redistribution and other socialist programs (Social Security, Medicare, etc.) in The Constitution.

The government is, therefore, prohibited from engaging in these programs.

If it weren't for FDR's threats to pack the SCOTUS and subsequent decisions in his favor that would be well established.

[editor-surveyor]

"Why should I have to pay 30% in additional taxes for the privilege of using my money?"

So the class envy gang can get even!