WOODALL INTRODUCES FAIRTAX BILL ON DAY ONE WITH RECORD NUMBER OF ORIGINAL CO-SPONSORS

Press Release | Jan. 5, 2011 | U. S. Rep Rob Woodall

[phil_will1]

Washington, DC—On Wednesday, January 5, 2011, Congressman Rob Woodall (GA-07) introduced H.R. 25, the FairTax. The FairTax legislation eliminates the current income tax paradigm and replaces it with a system of taxation based on consumption. The bill was introduced on Wednesday with 47 original co-sponsors—the most original co-sponsors the bill has ever had for its initial introduction.

“I committed to the Seventh District of Georgia that my efforts in Congress would focus on reclaiming freedom for the American people. It is for that reason that I am proud to make the FairTax—the only bill that restores transparency and simplicity to our tax code—my very first action in Congress. I have said since its inception that the FairTax is not a tax bill; it is a freedom bill,” Woodall said.

Woodall, who was sworn-in to Congress earlier in the day, played an integral role in crafting the original text of the FairTax as former Congressman John Linder's Chief of Staff when the bill was originally introduced in 1999.

"Our current tax system is a bloated, convoluted mess that gives government power over Americans' pockets. With 47 Members of Congress and counting signing their names to the FairTax, we are closer than ever before to voting on legislation that eliminates the frustrating mess that is the IRS."

Although the FairTax was introduced with 47 original co-sponsors, Woodall anticipates adding many more Members of Congress to the bill. Once the FairTax is introduced with the original co-sponsors, Members are able to sign on to the bill as co-sponsors throughout the 112th Congress.

"The number of signatures on the FairTax this time around is a testament to the will of the people. It is clear that Americans do not want to have their hard-earned money taken away and they want to reclaim the freedom to spend their money how they choose and when they choose.”

The list of original co-sponsors is as follows:

1) Tom Price (GA)

2) Brian Bilbray (CA)

3 ) John Carter (TX)

4 ) Michael Conaway (TX)

5 ) John Duncan (TN)

6) Virginia Foxx (NC)

7) Steve King (IA)

8) Michael McCaul (TX)

9) Pete Olson (TX)

10 ) John Sullivan (OK)

11 ) Mac Thornberry (TX)

12) Phil Gingrey (GA)

13) Roscoe Bartlett (MD)

14) Don Young (AK)

15) Ander Crenshaw (FL)

16) Todd Akin (MO)

17) Lynn Westmoreland (GA)

18) Tom Graves (GA)

19) Gus Bilirakis (FL)

20) Ted Poe (TX)

21) Randy Neugebauer (TX)

22) Jeff Miller (FL)

23) Robert Wittman (VA)

24) Jack Kingston (GA)

25) Marlin Stutzman (IN)

26) Jeff Flake (AZ)

27) Billy Long (MO)

28) Cliff Stearns (FL)

29) Tim Walberg (MI)

30) Dennis Ross (FL)

31) Dan Boren (OK)

32) Mo Brooks (AL)

33) Darrell Issa (CA)

34) Richard Nugent (FL)

35) Tim Scott (SC)

36) Blake Farenthold (TX)

37) Jeff Duncan (SC)

38) Rob Bishop (UT)

39) Mike Pence (IN)

40) Sandy Adams (FL)

41) John Mica (FL)

42) Sue Wilkins Myrick (NC)

43) Dan Burton (IN)

44) John Culberson (TX)

45) James Lankford (OK)

46) Mike Pompeo (KS)

47) Gary Miller (CA)

###

-- Jennifer Drogus Communications Director Congressman-elect Rob Woodall

Seventh District of Georgia 202.225.4272 | jennifer.drogus@mail.house.gov

[Bigun]

You had the question answered hundreds of times previously Lewis but are too thick sculled to “get it”!

The FairTax base is very much larger than the income tax base Lewis!

[CMAC51]

If you go back all the way to the beginning of the 20th century, government revenue as a percentage of GDP has ranged from mid 18% range to the high 19% regardless of whether the economy was boom or bust and tax rates were high or low. For general discussion it is just easier to round it off to 20%.

How that 20% is collected has varied. You have excise taxes, income taxes, taxes masquerading as fees, estate taxes, gift taxes, corporate taxes, on and on. The bottom line is that every one of those taxes get embedded in the price of goods and services and are ultimately paid by the consumer. The method of collection can vary across a broad spectrum, but the money that gets paid as taxes comes out of the pocket of the consumer.

So, the Fair Tax, in order to eliminate all the other forms of taxation needs to provide roughly 20% of GDP to the government as revenue to directly replace the current tax system. The perceived tax rate may vary based on any gimmicks involved in the particular system. If you are going to do rebates (a gimmick), then a rate higher than 20% is necessary. However, the net effect will still be 20% if the system is set up to be revenue neutral. Eliminate the rebate, and you don’t need as high a rate. Politicians like the gimmicks to sell a proposal, but in general they do not really effect the burden the system places on the individuals. In the end, taxes are paid by the consumers and they generally balance out based on your level of consumption, regardless of the gimmicks in the system.

The overal benefit of the Fair Tax is that the consumer will end up paying a net 20%. Under the current system, they are paying a net 20% plus another 10 - 18% on imported goods and services.

Implementation of the Fair Tax will not be as easy as some would have it. All of the current inventory, both finished goods and inventory in the production flow have the 20% tax burden embedded in them already. A transitional process will be required to deplete current inventory and move to inventory which does not have an embedded tax content. This will be complicated, but it is doable and the tax bonus from the sale of imported goods and services will be a usefull tool during the transitional period.

[Defend Liberty]

There are many more Fair Tax candidates who were elected to office in November than past elections. The growing angst with the federal income tax code and the IRS, particularly as it will be used with unconstitutional Obamacare, is becoming a perfect storm for passage of The Fair Tax.

[Defend Liberty]

FLAT TAX is equitable.

Our current federal income tax code began as a flat income tax when the 16th Amendment was passed in 1913. People were taxed 1% on the first $20,000 of income and 7% on income over $500,000. Less than 1% of the population earned more than $500,000 in 1913. That also means more than 99% of the population was taxed 1%, making it a flat income tax.

Over the last 98 years it has evolved into the multi tiered, increasingly convoluted and oppressive mess we have today. Another flat income tax will morph back into what we have today only faster thanks to the thousands of lobbyists, who get all sorts exemptions for their big business clients, that didn't exist in 1913. Also the IRS will still exist! There is certainly nothing equitable about what has become of the federal income tax code.

All that ignores the fact The Fair Tax is a flat tax but on consumption instead of productivity since the Fair Tax will impose only one rate at the point of sale.

[Defend Liberty]

They still believe that they are in charge of us and we work for them.

Then we the people will have to tell them differently.

[Defend Liberty]

Pass an amendment abolishing the income tax first. Then we can talk about Fair Tax.

Each session of Congress since 1999 when The Fair Tax has been introduced, there has also been a House joint resolution to start the amendment process for repealing the 16th Amendment. It will happen again in this session of Congress. They will be done concurrently.

[Defend Liberty]

The Fair Tax is the first building block to a VAT!

The Fair Tax is the opposite of a VAT! We already have a VAT with the federal income tax code! Corporations consider taxes levied against their income as a cost they pass onto the consumer by including that cost in the price at each stage of production for everything we purchase. The Fair Tax will remove those embedded VATs by eliminating all federal income taxes, including corporate income taxes. Taxes will not be levied on businesses with The Fair Tax. The Fair Tax will only be applied once, at the final point of sale.

[Defend Liberty]

Tax COLLECTION is not the problem. Spending is the problem.

They're both a problem. The federal income tax code is a huge and growing problem with a tax code of more than 67,500 pages that is so complex and convoluted even the IRS answers questions incorrectly 50% of the time.

It is a problem when people have their hard earned money taken form their paychecks and dividend checks before they see those checks. The IRS is a major problem as they and their court system presume a person guilty until proven innocent and can peer into every aspect of a person's personal life through a multitude of forms that are filed annually or quarterly.

[Defend Liberty]

Any system of taxation will require an agency to print forms and instructions, collect the money, and enforce the law.

Forty five states already require businesses to fill out forms to collect a state sales tax. The Fair Tax will be merely one more line on that form. The only form an individuals will need to fill out is one for the prebate but they are not required to fill out the form if they don't want the prebate.

Any talk of eliminating the IRS is juvenile and ill informed.

Tell that to the growing number of grassroots Fair Tax supporters and cosponsors.

[phil_will1]

“Implementation of the Fair Tax will not be as easy as some would have it. All of the current inventory, both finished goods and inventory in the production flow have the 20% tax burden embedded in them already. A transitional process will be required to deplete current inventory and move to inventory which does not have an embedded tax content.”

That is why there is a transitional credit included in the bill for holders of inventory as of the effective date of the FairTax’s implementation. If it were not for that credit, your point would be true.

[phil_will1]

“In the end, taxes are paid by the consumers and they generally balance out based on your level of consumption, regardless of the gimmicks in the system.”

I’m not sure I understand your point, but if you are suggesting that taxes “balance out” in proportion to consumption under the current system, then I would suggest otherwise. Because of all the “loopholes” under the current system, there are numerous examples of inequities. A friend of mine is a CPA who does some very high end tax returns. He told me that he sees cases all the time where a transaction can have entirely different tax consequences depending on the legal form of the entity involved.

I have often thought that if someone attempted to write a book describing the inefficiencies, inequities and illogical aspects of the Internal Revenue Code, it would be longer than War and Peace.

[MrB]

HIDDEN tax collection is certainly the problem.
Part of the beauty of the fair tax is that, with every purchase, you see how much the gov’t is taking from you.

And if they increase the rate, everyone sees it.

[MrB]

The whole point behind the complexity of the US Tax Code is so that the rules can be applied differently for different people and entities.
It is from this unequal applications that politicians derive their power.

[lewislynn]

You had the question answered hundreds of times previously Lewis but are too thick sculled to “get it”!

Do you have a key on your keyboard with that one touch reply? You must.

The FairTax base is very much larger than the income tax base Lewis!

You don't know a tax base from first base. Is the Fairtax revenue neutral or is that just another Fairtax lie?

[lewislynn]

Don't lecture me with your double talk blather. I'm not interested in your 'if this, then that, if that then this' Fairtax speak. Use some logic, simple arithmetic and answer the question...You can still be the first

You can't answer because it isn't possible with out lying.

[Bigun]

You don't know a tax base from first base.

ROFLMFAO!!!

That is REALLY funny coming from YOU Lewis!

[CMAC51]

“In the end, taxes are paid by the consumers and they generally balance out based on your level of consumption, regardless of the gimmicks in the system.” I’m not sure I understand your point, but if you are suggesting that taxes “balance out” in proportion to consumption under the current system, then I would suggest otherwise.

The money to pay taxes always comes from the consumer. There is no other source for income, even investment and speculative income ultimately comes from the consumer. The path may be convoluted at times, but if you persist in tracing the source of income, it will always end up back at the consumer. If nothing is ultimately consumed, there is no source of income.

Under the current system, the consumer provides the funds to pay taxes for the entities (persons or business) down the revenue stream. The funds are paid as taxes in various forms along the revenue stream.

There are oportunities to transfer more to the government than necessary along that revenue stream. I am, of course, referring only to legal methods. It is similar to buying a car. Some people go into the dealership and pay sticker. Some people bargain. Some people use leases or business entities to alter the cost. The people paying sticker are doing so by choice or ignorance, but they do have alternatives available. So there are variations around the norm of what money is transferred to the government.

The second aspect of limiting how much is transferred to the government is in the area of alternative investment. A person or entity can choose to invest time or money into a direct effor to reduce payment to the government. Just as coupons can be used to lower the grocery bill, there are methods to reduce the tax transfer. Some people never use coupons while others invest hours collecting coupons and make good use of them. The hours invested have a value and they represent an alternative investment. Works out well for some people and more power to them. Essentially though, the entity is using an alternative form of investment. This creates a degree of variability however, the total financial picture must be examined including the alternative investment in computing the savings, not just the amount of tax avoided. This reduces the variability by quite a bit. For example, the CPA ends up transferring some of those tax funds to the government rather than the original entity. The money still comes from the end consumer though, it just took one more alternative stream on its way to the government.

So, yes, the consumer is the person actually providing the revenue to be transferred to the government. Also yes, there can be variability in the stream as that reveneue heads to the government. Even under the Fair Tax system, there will be variability. If you negotiate a lower price for something, you have in essence lowered your tax burden.

[CMAC51]

Don't lecture me with your double talk blather. I'm not interested in your 'if this, then that, if that then this' Fairtax speak. Use some logic, simple arithmetic and answer the question...You can still be the first You can't answer because it isn't possible with out lying.

Simple arithmetic - If you need to provide 20% of GDP as revenue to the government but you are going to return 13% of what you collect in the form of rebates or exemptions, you will need to collect 23% on every transaction at the point of sale.

Simple enough?

[lewislynn]

It’s a tax reform proposal which eliminates income taxes (both individual and state),

Thanks for validating my tag line.

[Taxman]

I’m very pleased to see this — Rep. Woodall promised to introduce the legislation when he announced his run to succeed Rep. Linder. Woodall worked for Linder since 1994 and has been a FairTax supporter FRom the original get-go in 1999.

He will be an excellent representative for Georgia and the FairTax.