Although I have no data to back that up, it seems as though consumption would have a correlation with the amount of tax you pay, and therefore the more you buy, and the more expensive the expense, the more taxes you pay. I suppose the only way around it would be to find a cheaper X outside of the country and ship it in... we're talking about big items here: capital equipment, boats, cars, etc.
I really like the idea of taxing illegal immigrants, child-teenager-grownagers, tourists, underground types (drug dealers), and those who abuse the welfare system.
One concern I have is that only new homes and cars would have the tax added. I find that as a potentially problematic as it may dissuade the purchase of new capital (especailly for medium to small business), new homes, and new cars. Of course it could have no impact at all, or just a small change to a more re-use friendly market, but I don't like the idea of new homes have to compete with used (pre-owned?) homes with a ~25% price increase on top. Same goes for cars really. Unless people will sell used stuff trying to have the new buyer pay them back for a part of the tax they paid. Which would just inflate the cost of used goods ... maybe not a huge issue.
Some closing comments from Garst at the Conservative Compendium:
- Part of what the fairtax does is cut down on all these hidden and complicated taxes that prevent people from even knowing precisely what they are paying. With greater awareness of the actual cost will come greater pressure to keep the rate down.
- Only new goods would be taxed.
- This tax doesn't just "move the damage around", it gives the lowest groups what is essentially a negative rate.
- Claiming the Fairtax would be too regressive requires a complete ignorance of the realities of today's effective tax rates as well as what all the FairTax will do, like eliminate all today's loopholes and special cutouts.
- We are talking about eliminating what people understand to be the income tax, but we're also talking about no more payroll taxes, no more social security taxes, etc.
- And of course, the single best thing about the fairtax: the government will neither know nor care how much you make, how you make it or who you give it to. You know, all that shit that shouldn't be the government's fucking business to begin with but must be known by government to implement an income tax.
Learn more here: www.FairTax.org
5 comments:
There is no reasonable equity of distribution under the current income tax system. What's more, the Tax Code has become a "tinkerer's paradise" for 53% of the lobbyists who game it in Washington DC. It's a lucrative business, and the U.S. TAXPAYER pays for ALL of it in higher prices (i.e., a hidden tax which is incomprehensible to the average working person; with respect to new vs existing homes, Bobbie's FairTax Blog does a good job of explaining this).
Prices after FairTax passage would look similar to prices before FairTax - not "30% higher" as opponents contend - competition would see to it. So, the FairTax rate (figured as an income-tax-rate-non-comparative, sales tax) on new items would be 29.85% (on the new, reduced cost of items because business isn't taxed under FairTax - thus lowering retail prices by 20% to 30%), or 23% of the "tax inclusive" price tag - this is the way INCOME TAX is figured (parts of the total dollar).
The effective percentages, that different income groups would pay under the FairTax, are calculated by crediting the monthly "prebate" (advance rebate of projected tax on necessities) against total monthly spending of citizen families (1 member and greater, Dept. of HHS poverty-level data). A single person would receive a prebate of ~$200/mo. A family of four, ~$500/mo. - in addition to working members no longer having tax withholding confiscated from the fruits of their labor every two weeks.) Prof.'s Kotlikoff and Rapson (10/06) concluded,
"...the FairTax imposes much lower average taxes on working-age households than does the current system. The FairTax broadens the tax base from what is now primarily a system of labor income taxation to a system that taxes, albeit indirectly, both labor income and existing wealth. By including existing wealth in the effective tax base, much of which is owned by rich and middle-class elderly households, the FairTax is able to tax labor income at a lower effective rate and, thereby, lower the average lifetime tax rates facing working-age Americans.
"Consider, as an example, a single household age 30 earning $50,000. The household’s average tax rate under the current system is 21.1 percent. It’s 13.5 percent under the FairTax. Since the FairTax would preserve the purchasing power of Social Security benefits and also provide a tax rebate, older low-income workers who will live primarily or exclusively on Social Security would be better off. As an example, the average remaining lifetime tax rate for an age 60 married couple with $20,000 of earnings falls from its current value of 7.2 percent to -11.0 percent under the FairTax. As another example, compare the current 24.0 percent remaining lifetime average tax rate of a married age 45 couple with $100,000 in earnings to the 14.7 percent rate that arises under the FairTax."
Further, per Jokischa and Kotlikoff (circa 2006?) ...
"...once one moves to generations postdating the baby boomers there are positive welfare gains for all income groups in each cohort. Under a 23 percent FairTax policy, the poorest members of the generation born in 1990 enjoy a 13.5 percent welfare gain. Their middle-class and rich contemporaries experience 5 and 2 percent welfare gains, respectively. The welfare gains are largest for future generations. Take the cohort born in 2030. The poorest members of this cohort enjoy a huge 26 percent improvement in their well-being. For middle class members of this birth group, there's a 12 percent welfare gain. And for the richest members of the group, the gain is 5 percent."
Fairtax is economic pornography. Its a fake, a charade. It depends on the magical mystery tour of taxing the federal government, to pay for the federal government. That's like me pretending I can pay myself 10,000 dollars a day to cut my own grass. Oh, I can write the check, I can even deposit the check -- but at the end of the month, I don't have 300,000 dollars.
As loony as it sounds - -Fairtax counts the 300,000. There are other goofy premises -- but this one is enough to tell you, this plan won't work. So I say -- bring it on, I would love to see it.
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Taxes, Unfiled Returns, Missing Records, Threat of Levy, or, if you need an Installment Agreement or an Offer in Compromise A tax levy or garnishment or attachment are all the same thing. The terms may be used interchangeably. A wage garnishment or levy may be against any asset. In the enforcement of tax collections. We prepare all Federal and State Unfiled tax Returns The Fair Tax Act (HR
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The Fairtax -- as whacked out as it is on math, and logic-- is right on a couple things.
1) only people pay taxes
2) lobbyist write the tax code.
After that, Fairtax is like those little pills they used to sell, that lets your drive your car using water.
I hope they pass tha fair tax, even though its goofy and can't possibly work.
Fairtax won't last long -- about three months. People will scream bloody murder and demand it changed back. I think it would be an hilarious three months, I could use the laughs. And America could use the education.
What happens when people realize Fairtax pretends to get 500-600 billion by taxing the government?
That's right, about 1/4 of the government revenue will come - FROM the government. Its just a sweet deal.
Neal Boortz wrote in his whacked out book, page 148 "The federal government itself will be a major tax payer"
Yeah! Its gonna be great! The US navy will pay an extra 4 billion on a 12 billion dollar aircraft carrier! NASA will send in an extra 3 billion for a Space Shuttle. The Pentagon will send in an extra 250 billion. Its gonna be great.
What happens when that absurdity comes to light? When people wake up from the fog of BS that Fairtax magic wand salesman have sold them. What happens when people say "Duh, you mean, duh, the government can't pay its own taxes, duh, no one told us, duh"
Well, what happens is this, duh.
The tax rate would have to go up, duh.
Maybe that's why the Presidental Commission on Tax Policy estimated a conspumption tax would have to be 57%. Cause they didn't pretend the government could tax the government.
Forget government paying its own taxes. Fairtax is so whacked out, even if the government COULD pay its own taxes, it STILL wouldn't work.
Why? Cause many people who would get the huge tax bills -- DON'T HAVE THE MONEY.
Thats right. The parents of a leukemia viction DONT have an extra 90,0000 to pay in taxes on the 300,000 they paid to keep their child alive. Thats why.
And the 75 year old widow in a nursing home with a broken hip DOESNT HAVE the 30,000 extra to pay just for her ROOM. Thats why.
This fairtax isn't just wrong -- its insane. I would be a WHOLE lotta fun to watch.
It really would be fun. How can I help you pass it?
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