Posted on 02/08/2003 5:56:38 PM PST by Bigun
White House Floats Idea of Dropping Income Tax Overhaul By EDMUND L. ANDREWS
WASHINGTON, Feb. 7 — President Bush, having already set off a firestorm over his proposals to cut taxes and revamp retirement accounts, suggested today that the time might be near to drop the income tax as a whole and replace it with some form of consumption tax...
(Excerpt) Read more at nytimes.com ...
We have no manufacturing jobs in this area of the country but instead a very high welfare rate and unemployment rate ---also the majority here are unskilled ---I'd rather they be working than living off welfare. I was just pointing out that with a very high trade deficit we now with very high consumer debt, we'd be better off if every one quit spending because the new products aren't made in the US ---what is the point of having many people add to their debt by buying foreign made products? That just will make things even worse.
Whenever I deal with salesmen I tell them that I expect them to lay out the downside as well as the upside of what they are proposing. I want to know the risks as well as the benefits. When I see that they are not leveling with me I boot them out of my office. I am approaching this proposal in the same light. If a salesman gets emotional or defensive I'm done with them.
I am concerned with the suggestion that consumer prices will adjust downward and some suggest they will be reduced by the amount of the tax. I find that difficult to believe because of the concept of price elasticity. Some products are price elastic and some are not. The proponents of NAFTA used a similar arguement that goods would become cheaper if companies moved to Mexico to manufacture their goods using cheaper labor. I haven't seen any headlines suggesting that prices are notably cheaper for these goods. We really don't know the actual effect this will have on prices or on which products, no one does with any certainty. I believe it is inaccurate to assume that the prices on all products will be affected the same.
Some say that the beauty of this bill is that no politician would jeopardize his political career to sponsor a tax rate increase. Let me remind them that the first tax in 1913 was 1%. I hope no one made that same arguement in 1913. Somehow the politicians have learned to survive. It must be some sort of survival mutation that they undergo.
No one has addressed the political realities of this type of bill. What type of ammendments could we envision being attached to this bill? You've heard the saying, "Be careful what you wish for, you just might well get it", and to which I realistically add, in a form that you hadn't expected. Make no mistake about it, the Ted Kennedy's and progressive caucus socialists will add their self-serving ammendmens to such a bill. This theory may look good on paper but the truth is no one at this point knows what form it will eventually have. If that doesn't scare anyone it should.
For discussion purposes let's say the middle class does get some kind of a federal tax break out of this. What's to prevent the money hungry states from filling the void. If they step in, where is my benefit? No, I'm not going to move because the government says I have to in order to get a tax cut (freedom and the pursuit of happiness). What other taxes will be passed in addition to NRST? Or should I ask, what other method of tax can Congress conceive of to take more of my money by not calling it a tax by name. It has happened.
Why is the NRST rate so high? I'm not ready to concede them that rate as long as we're trying to make taxes more fair. Government keeps getting bigger and more socialistic. Speaking of tax fairness, I would think by reversing that trend the government could do a lot to reduce the tax pressures it exacts on the taxpayers.
The IRS uses repressive force on taxpayers. What will the government do to sole proprietors and other small business owners who fail to report or pay their consumption tax returns? I hope they are going to be more compassionate towards them than the current system allows.
No one can guarantee how this bill would turn out once the legislature enacts it into law. No one can say with any certainty the political-economic effects this proposed form of tax will have because no one really knows. Our politicians represent a variable that could drastically affect the consequences of this proposal. I need to know all of the risks associated with this proposal.
Absolutely, I agree. President Bush would belong on Mt. Rushmore.
I think the problem with income tax now is that with so many people not working and with salaries dropping so they pay no taxes, the taxes are being paid by fewer and fewer people. A consumption tax seems like a better idea to me because it will encourage saving money and not taking out debt ---also it should help our large trade deficit when we aren't buying as many products.
I know, facts always get in the way of conjecture and wishful thinking and the truth is sometimes painful...live with it.
You're right. I can't imagine their ever being any lobbying over what constitutes 'strictly business purposes', considering how little gets expensed today by businesses, right?
More from the website:"Perhaps most importantly, to ensure that no American will pay tax on necessities, the FairTax plan provides a prepaid, monthly rebate for every registered household to cover the 23% consumption tax spent on necessities up to the federal poverty level."
I'm sure there would be no lobbying over what constitutes the poverty level, and how many dollars in transfer payments should be made by the federal government to be fair, right?
I'm not saying a sales tax is worse than an income tax, but lets not be naive about lobbying...
How does the government know how much welfare to give a person to offset their nrst payments and keep them above the poverty line? Is the government going to continue tracking income for everyone? Wouldn't that require the IRS? Who decides what constitutes income toward the poverty level, and why wouldn't the Left seize this opportunity to boost transfer payments to their constituents by boosting the federally declared poverty level? It's completely naive to think, given the billions and billions of dollars of impact that this or any tax has, that there won't be tons of lobbying to avert it's costs. You didn't even touch the business exemption. What's to stop me from opening a business, say a lemonade stand, that is operated from my house? I need to exempt my rent, because it's now a business expense, etc. Who will track whether or not it's indeed a business? Again, I'm not saying a sales tax isn't preferable to an income tax, but it's ridiculous to assert that lobbying would end, or politicians wouldn't use it to buy votes. How they collect the tax is, ultimately, much less important than how much they collect, and what they spend it on.
Errp.... my mistake. Tacked on an extra X where there was only one. Meant to say the 16th Amendment, which is the 'income tax' amendment. Though, it might be good to have a property ownership or length of residency in the community before you vote. Wonder why most of the college towns are bastions of socialist welfare supporters?
They already told me. I was just waiting for you to confess. LOL Sometimes, getting lost is as much fun as getting 'there'. And it teaches you more.
Or he just gets lost and wants us to think he does it for fun. ;-)
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