The FairTax

[filthpig]

"Render unto Caesar that which is Caesar's."
Filthpig has spoken.

 

[satellitedriver]

...and therein lies the problem.

Exactly, NY.
There in lies the rub.
I look at things from percentages, when it comes to money.
This is to suppose to help the lower class wage earner.
How?
We have a progressive tax structure, the less you make, the less percentage you pay.
The lower wage earner only pays nearly zero( less than 10%) in IRS taxes and has to only has to pay the local county sales tax of(roughly on an average, 8%).
To make the starting point of a "fair tax" at 23% is going to hurt the poorer working class than the present tax structure does.
I have not studied this subject in any depth. I can only look at my personal situation as a UPS driver.
My last filing with IRS for 2007 was $100,000. 00 in personal income.
Straight simple 1040 form, standard deductions. I have no debt and I have no extra deductions, since my wife and I have shut down our side business's.
My effective tax rate paid, due to it being a progressive tax structure, was 13.98%.
I can live with that.
Add the average 8% sales local sales tax to my Federal tax rate and I save 1.2% of my money over the "fair tax".
People will see more in their weekly check, but will give greater pause in spending it when they see a Big Mac and fries costs $10.50.
Less spending equals a slow down in the economy, IMHO.
As to the ability of the politicians being able to spend our money as they wish, well that is another thread.

 

[toonertoo]

The poorer in the country will get what is called a prebate, everyone will get it every month for the amount of sales tax a family of that size will have paid, up to the poverty level, then it ends. Same=Same

Buy a used car, no sales tax, buy a new car pay the tax.
buy a used tv, range, refrigerator, no tax, the tax was paid, how and when you pay tax will be your decision.
Spend 100.00 on groceries, pay 123. But you will have brought your whole paycheck home, not missing that extra 400 every week.
I do not have the book, I have just followed it for years. Check out the website, www.fairtax.org.
I think you will agree when you get the facts.
But yes, the income tax must be rescinded, before it can be passed and that is a large issue.,

 

[trplnkl]

Buy a used car, no sales tax, buy a new car pay the tax.

Wouldn't this alone bring about a slow down in new car sales, which would create cut backs in new car production, which would bring about layoffs, which would bring about more people on public assistance?

 

[JustTired]

I think a better idea is the "flat tax". It has been said (and I'll admit I don't know this to be true) that a 10% flat tax would give the government more money than they could use (yeah, right).

If the above is true (and everybody paid a flat 10% of their income) things would be simpler to manage. No deductions - no loopholes - no tax return to file - no IRS (with exception of those needed to monitor the self-employed). You make a dollar, you pay $.10. You make $100,000, you pay $10,000.

In my opinion, that is the real "fair tax". It's based on what you earn, not what you spend. Those at the top pay more, but in reality it's the same percentage as everyone else. Now....what's wrong with that?


By the way....someone mentioned earlier that illegals don't pay taxes. That is not true. By law, those that hire migrant workers (legal or illegal) must deduct federal taxes from their pay. The truth is that those that are illegal don't file tax returns. Therefore the government gets to keep all the taxes withheld from their pay. They end up paying more taxes per dollar earned than the average American. Another reason to not change the system, I guess.

 

[speeddemon]

That is the biggest concern that I have about the fair tax.

Wouldnt happen. You would have another revolution on thier hands. I also believe we are getting to a point where the poloticians are getting uncomfortable because talk radio is starting to help americans wake and up and think for themselves and see how much they TRY to screw the american people for THIER benefit every single day. Dont ever give up on the fairtax. Every great idea that ever came to fruition started off with an impossible dream.

 

[brownmonster]

What about those of us that pay state income tax. I pay roughly 90 bucks a week to the state of Wisconsin. Do we get a federal deduction for that? Overall I'm for a new tax structure. The people should be able to vote on every spending bill so these clowns in Washington have someone to reign them in. BM

 

[bellesotico]

Wouldnt happen. You would have another revolution on thier hands. I also believe we are getting to a point where the poloticians are getting uncomfortable because talk radio is starting to help americans wake and up and think for themselves and see how much they TRY to screw the american people for THIER benefit every single day. Dont ever give up on the fairtax. Every great idea that ever came to fruition started off with an impossible dream.

SD-
I am still going through the fairtax.org website, and I have to admit it is quite interesting. I've heard a little about the subject, but nothing too in depth. There is much to consider here.
It's really nice to see that you seem to be aware of the need for Americans to start holding our elected officials accountable for their actions. They are the people that we elect to represent our collective voice, and it is important that we as constituents remind them just who they are working for.

 

[av8torntn]

Wouldnt happen. You would have another revolution on thier hands. I also believe we are getting to a point where the poloticians are getting uncomfortable because talk radio is starting to help americans wake and up and think for themselves and see how much they TRY to screw the american people for THIER benefit every single day. Dont ever give up on the fairtax. Every great idea that ever came to fruition started off with an impossible dream.

Do not be so sure about that. The first thing that would happen is the Congress would only tax the income of the "rich". They would then expand who they classify as being rich and you would end up in small increments with a large part of the population subject to both taxes. Just think of the AMT. If you guys would start talking about the repeal of the 16th along with the enactment of the fair tax I think you could get many more people on board. The main problem is the Government is not going to want to fully give up their ability to tax based on income so in the end I think really what you would be doing is just adding more taxes. The people would have to take this ability away from them.

 

[steeltoe]

I think one of the problems is not so much the information but the misinformation that is being presented. My son was asking me about it as I have a bumper sticker on my Colorado and when I told him about the 23% sales tax he stopped listening before I had a chance to outline all of the positives. The fact that it is basically a user fee really appeals to me. Plus, it will be so nice not to have to buy the new Turbo Tax each year, keep track of all of my deductions and spend the time preparing my return.

Of course, making a $1,000 purchase and having to pay $1,230 to do so will be a hard thing to get used to at first but when I get to bring home every penny that I earned---priceless.

Remember, your $1,000.00 purchase is not the same as before. If a television costs $1,000.00 today, it would not cost $1,000.00 after the fair tax. The reason it costs $1,000.00 today is because htere are embedded taxes. This means that a $1,000.00 item today would roughly cost $813.00 making the item $1,000.00 after the fair tax.

 

[krash]

Can we do it? Yes we cam

 

[Mike Hawk]

Remember, your $1,000.00 purchase is not the same as before. If a television costs $1,000.00 today, it would not cost $1,000.00 after the fair tax. The reason it costs $1,000.00 today is because htere are embedded taxes. This means that a $1,000.00 item today would roughly cost $813.00 making the item $1,000.00 after the fair tax.

What are these embedded taxes?

 

[steeltoe]

What are these embedded taxes?

These are the taxes that are paid by companies when they produce a product. That $1,000.00 TV has these taxes passed on into the price of the TV. Every company must pay payroll taxes for their employee's. This tax is gone, therefor they can make that television cheaper. In addition, the TV maker is paying tax on all the products that they buy from their vendors to make the television, therefore, the cost of the products they buy to make the TV goes down and cost them less to build the TV.

If you make $50,000.00 per year, you cost your employer additional money in payroll taxes. You could cost the company over $60,000.00 per year in order for you to make $50,000.00 per year. The company would no longer pay these taxes, therfore passing the savings to their customers in the price of their prooduct. The price of the product goes down due to copetition.

 

[toonertoo]

Wouldn't this alone bring about a slow down in new car sales, which would create cut backs in new car production, which would bring about layoffs, which would bring about more people on public assistance?

My guess would be no it wouldnt. No one is buying now because they are crippled with fuel costs. The layoffs have been for suvs and pick ups. Especially in your territory, you need trucks. Take the burden down a notch with fuel costs, get a little extra money in your check you can afford what you need. There are also embedded costs in fuel, which would go away. It is suppose to be revenue neutral meaning the govt will still get what they "need", just without the income tax

I think a better idea is the "flat tax". It has been said (and I'll admit I don't know this to be true) that a 10% flat tax would give the government more money than they could use (yeah, right).

If the above is true (and everybody paid a flat 10% of their income) things would be simpler to manage. No deductions - no loopholes - no tax return to file - no IRS (with exception of those needed to monitor the self-employed). You make a dollar, you pay $.10. You make $100,000, you pay $10,000.

In my opinion, that is the real "fair tax". It's based on what you earn, not what you spend. Those at the top pay more, but in reality it's the same percentage as everyone else. Now....what's wrong with that?


By the way....someone mentioned earlier that illegals don't pay taxes. That is not true. By law, those that hire migrant workers (legal or illegal) must deduct federal taxes from their pay. The truth is that those that are illegal don't file tax returns. Therefore the government gets to keep all the taxes withheld from their pay. They end up paying more taxes per dollar earned than the average American. Another reason to not change the system, I guess.

That would have been me, and I guess I phrased it wrong. But it also helps me with explaining, that those self employed would pay as well and no cheating on what you make as you would pay when you buy, and the rich would still pay more as they spend more. And those working under the table is what I should have said, they will still pay tax, when now they are not.

 

[speeddemon]

Do not be so sure about that. The first thing that would happen is the Congress would only tax the income of the "rich". They would then expand who they classify as being rich and you would end up in small increments with a large part of the population subject to both taxes. Just think of the AMT. If you guys would start talking about the repeal of the 16th along with the enactment of the fair tax I think you could get many more people on board. The main problem is the Government is not going to want to fully give up their ability to tax based on income so in the end I think really what you would be doing is just adding more taxes. The people would have to take this ability away from them.

There would be no tax. IN implementation, all laws that give the government the ability to levee income tax would be repealed. And the only way it could be reinstated would be a vote given by the people. There would be NO KIND OF TAX. Under the fairtax, the government would have more revenue than the current tax structure. Just think of all the tourists that come over here to spend that would generate revenue. Corporations would flock to the US because of NO TAX on them. Jobs would abound. The U.S. would once again be the front runner for the global commerce highway. The standard of living for millions of Americans would go up. Its a no brainer. We need to push this so maybe when my kids are grown, they can benefit from this.

And....JustTired....that would not be fair on several fronts. First, we would end up being taxed mutiple times on goods produced, from the raw materials to the product being placed on the floor for sale. At each phase, each party would add thier 10% to the price of thier cost of production. Do you see how that embeds taxes? It wouldnt be 10%, more like 100%. And the poor shoudnt pay 10% at the poverty rate. UNder the fairtax, all Americans would get a PREBATE check from the government to cover the basics of living, like groceries, power bill, gas, ect... based on family size.

There is so much awsome information, you have to read the book, or better yet, do like I did, I got the audio book. I remember things better when I hear them. I will be glad to answer any questions anyone might have, just P.M. me.

 

[JustTired]

And....JustTired....that would not be fair on several fronts. First, we would end up being taxed mutiple times on goods produced, from the raw materials to the product being placed on the floor for sale. At each phase, each party would add thier 10% to the price of thier cost of production. Do you see how that embeds taxes? It wouldnt be 10%, more like 100%. And the poor shoudnt pay 10% at the poverty rate. UNder the fairtax, all Americans would get a PREBATE check from the government to cover the basics of living, like groceries, power bill, gas, ect... based on family size.

So, you are saying that nothing is taxed except the final product. So I could make the argument that if I buy a new monitor for my computer, that I shouldn't be taxed because it is of no use unless it is hooked to something. And, that being the case, it can not be considered a "final product" because it is of no use by itself.

Companies that produce "final products" would not pay taxes on the components that make up the item? While this could result in a less expensive product, I don't have much faith in todays world that it would be the case. Remember, they wouldn't be paying taxes on profits and not paying the "fair" sales tax. Matter of fact they wouldn't be paying any tax whatsoever on the federal level. Not that it would be any different than it is today with loopholes and tax breaks.

The definition of what can be taxed is the key. If I go to the store and buy a dozen screws, I will be taxed. If a company buys a dozen screws to complete their product, they should be taxed, too.

I have no problem paying taxes. I just think everyone else should have to at all levels. No loopholes, no special treatment, no tax breaks for big business. If you're not going to tax income and profits, and instead tax products by sales, then all should pay when something is bought (personal or business) whether it is to manufacture a product or is the product itself.

I agree something needs to be done to simplify the tax code. But, odds are that as simple as it could be, it will never happen that way. There will always be someone lobbying for consideration to their specific needs.

 

[BigBrownSanta]

If this tax plan were to ever pass, I see the country becoming a garage sale economy with Ebay being the #1 business in America.

 

[Braveheart]

Wait a minute, I missed the train, Ive been gone a few days.
I love Neal Boortz, and I love the fair tax, I want the fair tax.
Everyone always says, Oh it will be so hard to change.
Well its so screwed up now, with the IRS, why not try it. We could always go back. I want to take my whole paycheck home. Imagine the idiots amongst us who have credit card debt, we could wipe it out in months with our extra income, and fuel the economy.
We could afford gas again.
And the coffers would overflow. With tax dollars!!
I dont think it will ever happen, but I can dream.
The beautiful part, is even the hookers on Main St. would pay taxes. Even the drug dealers, even the illegals who are not (I do realize many are) paying, Everyone would pay, and get rebates up to the poverty level. So the truly poor would still not pay, and the awful rich could get richer, instead of being punished for achieving. And create more jobs for those people in need of a job. Makes sense to me...............

If it is a national sales tax then count me in. We also get tax money from all the tourists too!!!!!!!!

 

[toonertoo]

If this tax plan were to ever pass, I see the country becoming a garage sale economy with Ebay being the #1 business in America.

Nothing wrong with ebay.

 

[Braveheart]

I think a better idea is the "flat tax". It has been said (and I'll admit I don't know this to be true) that a 10% flat tax would give the government more money than they could use (yeah, right).

If the above is true (and everybody paid a flat 10% of their income) things would be simpler to manage. No deductions - no loopholes - no tax return to file - no IRS (with exception of those needed to monitor the self-employed). You make a dollar, you pay $.10. You make $100,000, you pay $10,000.

In my opinion, that is the real "fair tax". It's based on what you earn, not what you spend. Those at the top pay more, but in reality it's the same percentage as everyone else. Now....what's wrong with that?


By the way....someone mentioned earlier that illegals don't pay taxes. That is not true. By law, those that hire migrant workers (legal or illegal) must deduct federal taxes from their pay. The truth is that those that are illegal don't file tax returns. Therefore the government gets to keep all the taxes withheld from their pay. They end up paying more taxes per dollar earned than the average American. Another reason to not change the system, I guess.

Your info on the illegals is off a bit.

Many are paid under the table = no taxes.

Many pay the minimum tax required and since they are not filing tax returns they will not pay the true amount that they will really owe.

Many claim dependents they do not have. Many use other free social programs without really paying their fair share.

Sure they pay sales tax. And that is why we need to pay a national sales tax.

EVERYONE SHOULD PAY, WHETHER IT IS A BUSINESS, CHARITY, OR A CHURCH!!!!

We had a few business men here in the south that were deducted taxes from there illegal workers and not sending in any or all of the money. They luckily were caught but money was long gone. How many more got away with it.

Illegals use our health care system withiout paying their bill causing hospitals and other medical costs to rise for the rest of us. Kind of an indirect tax on us via our medical bills.