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Taxes!
Topic Started: Oct 8 2005, 08:43 AM (790 Views)
cmoehle
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Chris - San Antonio TX
My mother asked tonight, what will happen to social security under the Fair Tax?

I answered it goes away like all other taxes.

Then how would it be paid for?

The sales tax has been calculated to include payment of it. In the book, I remember Boortz and Linder saying, the tax system needs replacing, SS reform, but one thing at a time.
Politics is the art of achieving the maximum amount of freedom for individuals that is consistent with the maintenance of social order.
--Barry Goldwater
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MDPD6320
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Frank - Gainesville, Florida



I get the feeling that a simple idea is being made into a complex matter because
people don't want to understand regardless of the clarity of the argument.

So let me approach the fairness of the fair tax as opposed to the un-fairness of the progressive income tax from a different perspective.

1. Only wage earners who receive a W-2 or contract workers who receive a 1090
pay taxes. Period.
2. If you own a cash business you skim cash off the top and pay NO TAXES on it. If you get paid by check you have it made out to you personally, and take it to the bank it was drawn on to cash. PAY NO on taxes on it. Declare a nominal amount at he years end and pay a few dollars tax.
3. Corporations Pay NO TAXES. Pass on predetermined taxes a cost of doing business. The public buying their product pays the taxes.
4. Dope dealers, money launders, illegal gambling, prostitutes, pimps, thieves, fences and anyone making money by way of an illegal activity pay NO TAXES.
5. Add to this the estimated five billion dollars spent on income tax compliance each year, AND PASSED ON TO CONSUMERS, and you have a tidy sum of uncollected taxes and taxes paid by other than those who owe them.

The bottom line is the progressive income tax is unfair, discriminatory, too complex,
too easily avoided and collects less than it should. For these reasons alone it deserves to be scrapped, and unless someone can propose a better solution, and feel free to do so, I'll continue to support the Fair Tax.



" The government big enough to give you everything you want it is big enough to take everything you have."

"Extremism in the pursuit of liberty is no vice, and moderation in the pursuit of justice is no virtue"

All that is necessary for the triumph of evil is that good men do nothing.
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cmoehle
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Chris - San Antonio TX
And for the rest of your argument, Bruce...

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What about value-added taxes (VATs), like they have in Europe and Canada? Are they not consumption taxes? While VATs are also consumption taxes, and better than income taxes, the FairTax is not a VAT. A VAT works very differently. It taxes every stage of production. It is much more complex, and is typically hidden from the retail consumer.
Trust me, a Sales Tax is a Sales Tax. You are taxed on what you buy. And if you try to get into defining which items are Taxable Retail Sales if a certain consumer buys them, and Non-Taxable Wholesale Sales if another consumer buys them, you're going to be wishing you had your Income Tax back within 6 months. Or are you going to keep it simple by declaring that General Motors, etc. don't have to pay taxes?


If that's your argument against how the Fair Tax differs from a VAT, I don't understand. Are you arguing the Fair Tax is a VAT? A VAT applies a sales tax on purchases made during production, all of which hidden costs are passed on to the final purchasing consumer. With the Fair Tax, the only time a sales tax is paid is on the final purchase by a consumer. The difference clear. For example, the purchases of wood and bricks and nails and what all used to build a house are not taxed; the purchase of the new house is taxed--once, if you turn around and resell, the next buyers purchase is not taxed.

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  Second, in industrialized countries that have a VAT, it coexists with high-rate income tax, payroll and many other taxes that, in some instances, have led to marginal tax rates as high as 70 percent. Third, all other industrialized countries, except Australia and Japan, have a much larger tax burden than the U.S., which requires higher rates and makes tax administration much more difficult.
Obviously, that's an issue with any High Tax regime. But I don't see what it has to do with a VAT. If it's more revenue you want, you crank up the percentage. You don't make it more complex. Complexity comes in Sales Taxes from protecting special groups, just like an Income Tax, and you're back to point one.


I agree, the sales tax you envision is not a good thing.

But with the Fair Tax a single rate is applied to the purchase of all new goods and services. With it, as you say, if the government needs more revenue, they can adjust that rate, it's very simple, and, importantly, very visible, for the government will have to explain why it must be raised.

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Lastly, a VAT is a lobbyist’s dream, allowing them to install their loopholes unbeknownst to the purchaser. A retail sales tax, in contrast, is a lobbyist’s nightmare, applied as it is under the bright lights of the retail counter.
Exactly backwards, as point one. Having a tax show up under bright lights brings out our buddy NIMBY again. NOBODY wants to pay taxes, and they'll vote for the first person who'll exempt their little hobby horse. And since my argument is that there is no difference between a Sales Tax and a VAT except in our writer's mind, his "a VAT is a lobbyist’s dream" line is precisely correct, and applies to your "Fair Tax"!


Again, that sort of sales tax that you envsion is not good and doomed to failure. I don't argue that.

That is why the Fair Tax is, will be when passed, defined as a single rate on the purchase for consumption of all new goods and services, no exemptions.


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A point I made months ago - fix Income Tax! If you can't remove the complexities there, where you're essentially dealing with one set of yearlong transactions, you haven't got a hope with the multiple complexities of Sales Taxes!


Frank responded to this.
Politics is the art of achieving the maximum amount of freedom for individuals that is consistent with the maintenance of social order.
--Barry Goldwater
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cmoehle
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Chris - San Antonio TX
No matter how many times I read H.R.25 Fair Tax Act of 2005 (Introduced in House) and S.25 Fair Tax Act of 2005 (Introduced in Senate) I just can't for the life of me find a provision putting some consumables in a list for taxing and others in a list for exemption. I do, however, see where both explicitly state the following:

To tax all consumption of goods and services in the United States once, without exception, but only once.
Politics is the art of achieving the maximum amount of freedom for individuals that is consistent with the maintenance of social order.
--Barry Goldwater
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Fr. Mike
Member
I must be dense. :)

I thought that the only fair tax--was one where everybody else pays it but me. :tiphat:

How could it be a fair tax if everybody has to pay it? :cool:
A humble servant of the Lord Jesus Christ

Don't forget to say your prayers!
The unborn have rights too.
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cmoehle
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Chris - San Antonio TX
Good point. Because then each one of us pays less. Under current income tax codes, "Percent of population filing return...45%." (source)
Politics is the art of achieving the maximum amount of freedom for individuals that is consistent with the maintenance of social order.
--Barry Goldwater
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