Fair Tax

[wkmac]

This issue has gotten much mileage of late since a national syndicated talk show host (Neal Boortz) co-authored a book on the subject and is a regular topic of discussion on his radio show.

Many opposing points of view for a variety of reasons had been made against the Fair Tax, some valid and some very weak IMO. Here is another opposition piece that is quite extensive but it's also not based on opposition as a result of party loyality, support or affiliation. Most yacking in Congress draws down to party politics but this is not the case here with this piece. Hope you find it worthwhile if you are giving thought to the idea of the Fair Tax.

The Fraudulent Tax - Mises Institute

 

[scratch]

In a post a while back, I stated that one month I had added up all the taxes I paid in one month, including all the "hidden" ones in everything you buy, and figured I was paying at least fifty cents out of every dollar I make. I think "The Fair Tax" is a good idea, if all the problems could be worked out in it. You get all your paycheck, if you don't buy anything, you pay no taxes. If you are wealthy and buy a lot, then you will pay more than the average person. I don't think that our so called "representatives" will ever vote it in though. The politics in Washington rely on class warfare, what is right or fair will never happen and the true will of the people just gets overlooked as usual.

 

[toonertoo]

I think the greatest thing about fair tax is (besides keeping all your money and decidding when to spend it) is you only pay tax on NEW.. If you buy a new car youll pay 22-25 %. So on a 30K car, youll pay 6k in tax. If you buy one a yr old, already licensed for 29k, you pay zip.

The 22% sounds like alot. But as scratch king stated, if you really add it up, you will save, unless you want to spend and the economy will have a growth unseen in recent yrs.

So you spend 200 on groceries, you pay 244, but if thats all you buy that week, thats all the tax you pay. Then there is the rebate check everyone gets up to the poverty limit. Keep an open mind and check into it. Everyone will pay, the illegals, the welfare crowd, the drug dealers. But the truly indigent will get their tax back that they have paid. Ive thought for yrs, it sounded great. I cant wait. I heard Boortz say within the next 12-24 months!! Pass the word on. Give it a read. No more april 15th, scrambling for receipts etc, waiting to get YOUR money back or seeing how much they want more!!!

 

[wkmac]

I think what America needs more than anything else is a wide open National debate on taxes, their nature and even the nature and operation of money and our monetary system. Fair Tax obviously has it appeals but it has it cons as well and to be honest, no method of taxation is perfect. They will all have some pros and cons to them but it will also be based on what the motive and the goal behind the tax really is to be able to appreciate it's true purpose. One pro more than any other about the Fair Tax IMO is it's precieved transparency. It would appear all taxation as it realtes to personal and corp. income as well as SS and Medicare taxation are striped out of the shadows of embeddedness and you see it for all it's worth everytime you make a purchase. That is one great appeal IMO but there are also the "devil in the details" as well.

A nice article in the form of a 12 year old speech given by an Attorney at the National Archives in Washington DC which entails a brief history of taxation in America IMO is worth the read when considering this subject. Hope you find it worthwhile and informative from a historical point of view.

A Brief Tax History of America by Charles Adams

 

[CTOTH]

I personally think that Americans wouldn't be so far "up in arms" over high taxes if we felt that they were being used wisely. Education is far too under-funded, defense if far too over-funded. Take notice when the government negotiates a contract with a domestic firm, the price always seems higher than it would be for you or your company to receive a similar service or product. IE... Carnival cruise ships for Katrina evacuees or the border fence in NM.

JMHO

 

[tieguy]

government would not know what to do. They love to take your money and then give you half of it back through some feel good program. We could probably eliminate the payroll tax completely if we actually voted finance experts into office. Imagine an untouchable trust fund being invested to eventually eliminate the need to collect taxes. Imagine no IRS threatening to take your valuables or put you in jail if you did not pay your taxes.

On second thought we should put the IRS under homeland security and have them work on taxing the terrorists. I think they're up to the challenge.

 

[toonertoo]

Education underfunded? I dont think.
Maybe I should be the controller for the month, and instead of buying a magnetic board and computer vinyl cutters to make the leaves (for autumn) and letters etc), for 3000 bucks, which only the "activity director" ever learns to use, I would give kids construction paper and scissors, or maybe wax paper and an iron. Schools are not underfunded, the teachers are not utilizing their skills, and the money is not spent wisely. You dont need a brand new school, you need new infusion into the teaching segment of the schools. Old buildings work just fine, new is not always better.

better put on the flame suit for this one.

Schools are trying to teach kids with no upbringing, no manners and no respect. More money will not fix that. Getting rid of the welfare system, and putting parents in jail for their kids behavior might.

 

[scratch]

Education underfunded? I dont think.

better put on the flame suit for this one.

Schools are trying to teach kids with no upbringing, no manners and no respect. More money will not fix that. Getting rid of the welfare system, and putting parents in jail for their kids behavior might.

Tooner,You go girl!
My wife works as a substitute teacher in Public Schools. They have enough money, my local taxes mainly go there. They are poorly ran by our "intellectual types" with Masters and Doctorate degrees.Social promotion, lets promote kids who can't read so their feelings don't get hurt. Lets cut out band and PE so the football team can have newer equipment. Respect and Dicipline in the classroom is practically non-existant. When I was in school, if we misbehaved, we were taken out in the hall and had our asses paddled. We never had the behavior problems like we have now. I could go on a long time.....................

 

[CTOTH]

Education underfunded? I dont think.
Maybe I should be the controller for the month, and instead of buying a magnetic board and computer vinyl cutters to make the leaves (for autumn) and letters etc), for 3000 bucks, which only the "activity director" ever learns to use, I would give kids construction paper and scissors, or maybe wax paper and an iron. Schools are not underfunded, the teachers are not utilizing their skills, and the money is not spent wisely. You dont need a brand new school, you need new infusion into the teaching segment of the schools. Old buildings work just fine, new is not always better.

better put on the flame suit for this one.

Schools are trying to teach kids with no upbringing, no manners and no respect. More money will not fix that. Getting rid of the welfare system, and putting parents in jail for their kids behavior might.

I agree to an extent but I don't think that a teachers salary is high enough to put up with the BS they endure form the kids with no upbringing. $25,000 a year is hardly a living for somebody who is essentially raising the nation's youth.
You're a driver, right? Do you have children? If so, how much time to get to spend with them during the week vs. how much time do their teachers spend with them. Nowadays, most folks can only afford to be part-time parents.
Just some food for thought.

 

[moreluck]

just a quick school comment.....Not every kid in class should get a gold star. Kids need to know about working hard for the "reward" and not everybody can have a star unless you earn it. It's a "life lesson".

 

[toonertoo]

Ctoth, I agree teachers are underpaid, my lovely daughter in law teaches second grade, in a public school which is in a small town, and still quite good. And I have no problem throwing money at schools for computers, and new hi tech things. And what I hear her talk about and what I see, there is no amount of pay that I could do it for.

When I talk about infusing teachers, I mean letting them do what they had the heart and desire to do, teach.
Not have to deal with people at conferences who really have no interest in their child, or wait for parents to come and have 2 out of 60 show.Or deal with the ADHD who may not even be ADHD, just labeled that because he/she has no where to chanel energy where anyone pays attention but at school. Which takes away from the kids who do want to learn. I deliver to 4 schools, I see waste at many. They say they need new schools coz some are old and hard to heat, yet they are like 80 degrees in the winter, and 60 in the summer and the kids have windows open on every floor. I see brand new boxes never opened, full of books, in the trash cans. And why do the secretaries have tvs in the office, why are they on aol writing email when they should be working?

Yes I am a driver and I was a single parent but I did not start driving until they were in high school. If They had started being problem children, I would have quit and they knew it. For them to have what they had they needed to be responsible. And they knew that from the time they were 10 and 6, and I was on the preload. You get yourselves up, and get to school on time, and no crap, or Ill go back to making 3 bucks an hour and they got it. I wish I had more time with them even then but that wasnt how it was planned just the way it ended up. You have to spend as much time as possible, with them, when you have to work, and everything else goes on the back burner, including social life and dating and anything else you might like to do, because you have a responsibilty and your life comes second.

If everyone felt that way what a perfect world it would be.

 

[av8torntn]

 

[mountaingoat]

... eliminate the payroll tax completely if we actually voted finance experts into office. ...

The IRS cannot get rid of the payroll tax because if they did, they would have to change the tax system. Think about it. They take a little bit out of your paycheck each pay period, and then give you some back at the end of the year. Imagine if they didn't take the money out, you would be faced with your ENTIRE tax bill at the end of the year. Seeing that much money go out of your hands in one action would cause people to think "what is the government actually doing with my money?" Besides, how many people would have already spent it by that time and would not have the money to pay for their tax bill? Second, we complete a tax form that is just numbers, and lots of taxpayers receive a refund check so it looks like they "get money back" from the government. Well, it was their money to begin with, but that $1500 or $2000 that they get back floods their vision that it was overpaid to being with, and that they really paid the IRS $12000 to get back $2000.

I am 100% in favor of the fair tax (or a consumption based tax system). I think that we will eventually see this come into play, but more in combination with the income tax than as a replacement. The government is not going to get rid of the income tax code because there are too many accounting jobs at stake - with a completely simple tax system, how many accounting firms doing 1040 forms would be put out of work? The IRS would not need probably 90% of its jobs. H&R Block would be a thing of the past. TurboTax's business model would evoporate. There is too much industry, jobs, and economy surrounding the tax structure in this country. I don't believe any politician wants to touch that consituentcy.

 

[wkmac]

Fair Tax is Not Fair!

 

[Braveheart]

The consumption based sales tax is the best thing we could do.

You get 100% of your check whether your a $7 per hour worker or a million dollar CEO.

You decide how and when to spend the money and therefore how and when to pay taxes. If you are frugal and shop once a month or once every couple of months for things then the money sits in your account making interest. If you save all year long and shop for clothes, suits, Costco fo non-perishables as well as car and home improvements then you can really lower your taxes.

The bigger picture here is that now ALL of the people in our country will now pay taxes and not just a small segment.

As it is now many groups do not pay taxes due to not actually being on the IRS books for making an income in the USA. Others have tricked, lied or worked the system, i.e. corporate lobbyist, to not pay any taxes despite making a lot of money.
The lower class in many cases pay no taxes yet get many of the services and tax write-offs!

#1 No more tax write-offs. That includes corporations, government, churches, and charities!

UPS brings in 30 billion dollars they KEEP 30 billion dollars. If they buy toilet paper, oil, gas, trucks, tape, planes, electricity, then they pay taxes that way! Watch how fast alternative fuel trucks are bought while solar panels and windmills get put on UPS property! Sure we may be wiping our butts with delivery notices as they will limit us to two squares of TP.

#2 All classes will now pay taxes rich and poor. Maybe now people will not be so wasteful with things.

#3 DRUG DEALERS do not pay income taxes and the drug trade is a multi-billion dollar per year business. They sure do buy goods and services though! They will now pay taxes!!!

#4 Illegal immigrants are not on the books or the "bosses" and "contractors" tell them they are collecting taxes but never really foward it to the IRS. Now they pay taxes as well.

#5 American workers who UNDER-REPORT their real income yet spend all of their real income will now pay taxes. Some of these are those who work under the table or work for tips like waitresses, bartenders, airport luggage handlers, doormen, strippers and last but not least hookers

#6 Legal and illegal gambling profits that are not reported. Now these people will help pay taxes as well.

#7 Tourists who do not pay income taxes will now pay consumption taxes.

#8 Criminals including high-tech and low tech, thieves and bank robbers steal and then re-sell the stolen items yet pay no income taxes. We do in higher insurance but in reality they make income and only pay local sales taxes. NOW even these low-lifes will help shoulder at least a tiny portion of the tax burden when they take the dirty money to go buy stuff. Well unless they just steal it as well.

The actual consumption tax rate will be lower than you think once you realize how much money will now be flowing in from all of those that have not been paying.

This would solve all of our tax problems!

 

[UPSNewbie]

Excellent points, sir. ^
That's exactly what I see in it.

One example: Lawn care. Most around here are just themselves working and have no W-2 to file, therefor easy to not pay taxes on their earnings.

 

[Braveheart]

I forgot one very important area that needs to be taxed NOW to help the state tax issues but also would need to be taxed under the cunsumption tax system.

INTERNET SALES!!!!!!!!!!!!!!!!!!

 

[tieguy]

Is the consumption tax fair to the poor? currently the top one percent pay about 90 percent of all taxes.

 

[UpstateNYUPSer(Ret)]

Is the consumption tax fair to the poor? currently the top one percent pay about 90 percent of all taxes.

The Fair Tax has a rebate which is intended to benefit the poor. I don't have the dollar figure of the rebate or income limts for those who would qualify handy but consideration has been given for those less fortunate.

The Fair Tax will require a change in mindset for consumers. 23% sales tax will almost triple the 8% that we currently pay in New York.

I am a strong advocate for the Fair Tax but fear that it may never come to be, which is a shame because our current tax system is deeply flawed and skewed to favor the wealthy.

 

[Jones]

Is the consumption tax fair to the poor? currently the top one percent pay about 90 percent of all taxes.

Actually, the top 1% of wage earners pay about 40% of the total tax bill. You have to go with the top 25% of wage earners to get close to 90% of total taxes paid. That includes you and me btw, my wealthy friend .