[OrthodoxPresbyterian]

To: Principled ~~ I know. Someone suggested they be excluded up front. I'm fine with that. Whatever mechanism can be sold to get this done is fine by me. 527 posted on 11/06/2002 7:52 PM PST by Jim Robinson

I guess I could agree to "whatever mechanism possible" to get this sold, but speaking for myself I would much rather receive a flat $200 per-month, per-person "basic necessities" rebate and decide for myself what my "basic necessities" are, than let some politician decide what sorts of food and housing constitute my "basic necessities" (and next thing you know, clothing, and next thing you know, medical care, etc.... exemptions and loopholes as far as the eye can see).

For this reason, I strongly support the HR 2525 "Fair Tax" proposal over the exemption-and-loopholes "Alan Keyes Tax" variety, and I hope that HR 2525 is the Bill which actually goes forward.

Incidentally, assuming a 30% Sales Tax rate, with a $200 monthly rebate, persons earning less than $8000 per year would be living essentially Tax Free, and persons earning less than $17,000 per year would be paying less in Sales Tax than they are now under Payroll and Income Taxes. The Middle Class and Affluent will likely see little tax advantage (as the rebate is dependent on household size, Singles and smaller households might pay slightly more, large households might pay slightly less), but I am confident we'll make it back in Time-and-Effort savings.

[Principled]

THe rebates for HR2525 are higher than you're assuming. The rebates (last year) were something like $186 per parent plus $156 per child all per month.

It's based on HHS poverty levels.

[ancient_geezer]

Incidentally, assuming a 30% Sales Tax rate, with a $200 monthly rebate, persons earning less than $8000 per year would be living essentially Tax Free, and persons earning less than $17,000 per year would be paying less in Sales Tax than they are now under Payroll and Income Taxes

How about some real numbers from a real bill before Congress:

 

All legal residents will receive a FCA equivalent to the FairTax paid on essential goods and services. The FCA will be paid in advance, in equal installments each month. The size of the monthly FCA will be determined by the government's Poverty Level for a particular family size, multiplied by the tax rate.

Every year, the Department of Health and Human Services [HHS] determine the "poverty level" for each family size.

The 2001 "FairTax" Family Consumption Allowance Figures
Family Size	HHS Poverty Level	Annual FCA	Monthly FCA
One	$8,590	$1,976	$165
Two	$17,180	$3,951	$329
Three	$20,200	$4,646	$387
Four	$23,220	$5,341	$445
Five	$26,240	$6,035	$503
Six	$29,260	$6,730	$561
Seven	$32,280	$7,424	$619
Eight	$35,300	$8,119	$677

1) Federal Register: February 16, 2001, Pages 10695-10697).

[ The monthly FCA for each adult is .23 * (HSS poverty level for a single person)/12 to assure no marriage penalty due to the manner in which the poverty level is dependant on family size. The monthly FCA for each child is .23 * (the incremental increase of HSS poverty level for a family with one child over no child) ] A. Geezer

A family of four, for example, could spend $23,220 per year free of tax because they will have received over the course of the year rebates totaling $5,341. $5,341 is the amount of sales tax paid on $23,220 in expenditures. A family spending double the "poverty level" or $46,440 per year will effectively pay tax on only half of their spending and, therefore, have an effective tax rate of 11 ½ percent or half the FairTax rate.

The beauty of the FairTax is that you can control how much you pay in taxes. If you happen to save, invest or spend a portion on used [previously taxed] items, you can get your effective tax rate below 9%.

 

The Effective total federal tax rate as a function of expenditure for a family of four under the NRST

[concerned about politics]

Incidentally, assuming a 30% Sales Tax rate, with a $200 monthly rebate, persons earning less than $8000 per year would be living essentially Tax Free, and persons earning less than $17,000 per year would be paying less in Sales Tax than they are now under Payroll and Income Taxes.

They may pay taxes at first ,but get money (more than they paid in taxes) back through earned income credit.
Therefore, are really tax free already. They're making money from the government by being low income.
The numbers you exampled would get them something like $1,500.000 in tax rebates even though they didn't even pay that much in taxes in the first place. It's "free" money back because they're "poor." It's a social program- type handout.

[CliffC]

Here's the "Prebate" Chart had the FairTax been in effect this year...
Family Consumption Allowance for 2002!

Cliff Cofer - State Director, AFFT Volunteer Iowa Team

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* * * Bye, bye... Income Tax (and IRS)! We won't miss ya' at all! * * *

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