The NRST is a terrible idea that will lead to a massive underground economy as people use cash to avoid paying the tax. It will lead to multiple rates on products that the government favors or disfavors. It is heavily biased against consumption which is anti free market and will lead to overinvestment. It will also lead to the taxation of the internet which will shift e-commerce sites offshore.
Some people want a more voluntary system. You do that by adding more fees to government services-not by taxing goods and services in the private sector (which most states find difficult to tax)
It is heavily biased against consumption which is anti free market and will lead to overinvestment.Or it will lead to a run on savings. And wiser choices in spending. Yes, the economy will feel a shock as it adjusts, but in the end, it will be much stronger, people will have more cushion to avoid fluctuations in income, and the phenomenon of over-financing will taper off.
The IRS taking our insome off the top is immoral. And the President who abolishes it will be politically immortal.
Not so, arielb, not so.
"The NRST is a terrible idea that will lead to a massive underground economy as people use cash to avoid paying the tax."
The NRST will actually shrink the underground economy, which is, BTW, the fastest growing segment of the US economy. Here is the logic: I believe that most Americans are honest, and that, given the opportunity to be treated with equality (taxwise), they will respond by voluntarily dropping out of the underground economy. The risk of getting caught as a tax cheat for 30 cents on the dollar (the NRST) is not worth the penalty. OTOH, in today's economy, a self-employed person in the 39 1/2 percent tax bracket has an 82 cents on the dollar reward for cheating (do the math: 39.5% + 15% (SS and Medicare) = 55% tax bracket. In order to have $1.00 after taxes in that environment, a person has to earn 1/.55 = $1.82). That is a powerful incentive to cheat, which the NRST eliminates. Not only that, the fact that the NRST eliminates the progressive penalty on earnings and treats all persons exactly alike will tend to cause people to become more honest.
"It will lead to multiple rates on products that the government favors or disfavors."
Only if the American people fall asleep at the switch again. Remember, we have an obligation as citizens to keep the rascals in check. When we fail, we get screwed. When we succeed, we get rewarded. "The price of liberty is eternal vigilance!"
"It is heavily biased against consumption which is anti free market and will lead to overinvestment."
The price of goods and services will not go up with a NRST. Consumption will, in fact, increase, because the American people will have more disposable income. And, investment will likewise increase. In the NRST environment, consumption and investment are good things, and in that environment, America will get more of both resulting in a rapidly growing, non-inflationary economy.
"It will also lead to the taxation of the internet which will shift e-commerce sites offshore."
So what? The sale of goods and services on the Internet should be treated the same as the sale of goods and services from the storefront. And goods purchased abroad which are shipped into the US will be taxed when they enter the country.
I'd suggest that you go to
http://thomas.loc.gov and read H.R. 2525 and H.R. 2717. Then start thinking outside the box about the multiple benefits the NRST will have for America, American businesses and the American people. The NRST is a tax whose time has come: a 21st Century tax for a 21st Century America.
The NRST will restore FReedom to America, revitalize our economy through rapid, inflation-free economic growth and, through its equality of treatment (flat rate) of all persons, end the horribly divisive Liberal/Socialist/Marxist class warfare America has been cursed with throughout the 20th Century.
The NRST is a tax whose time has come!