Anyone heard of the FairTax Act?

[Wiley]

[pcf, please go to the fairtax.org site. Look at the faq, and look at HR25, the bill to implement the Fair Tax. And yes, you'd win the bet.]

From the Fairtax.org site:

What is taxed? The FairTax is a single-rate, federal retail sales tax collected only once, at the final point of purchase of new goods and services for personal consumption. Used items are not taxed. Business-to-business purchases for the production of goods and services are not taxed. A rebate makes the effective rate progressive.

The key point is that goods and services are only taxed ONCE.

I would not be subject to jail because I am not in the business of house painting. No commercial service was provided. To think otherwise is the same as thinking that you must pay workmans comp ins. for your kid when he mows the lawn.

PLEASE, do a little reading on the site or spend a couple of bucks on Rep. Linder's book.

No taxing scheme is perfect, the Fair Tax is far better than the current system, and better than any of the proposed alternatives.

 

[Tim Currie]

Finally someone else who has read the book and doesn't just jump to conclusions.

Sometimes I get the feeling that alot of people's belief's here are that NOTHING will work or ever make a difference and all we do here is bitch about what's wrong. Instead of seeing how something might make some progress in the right direction we argue about why it is not perfect.... hmmm..

 

[ceetee]

The removal of the present hodgepodge of laws should allow manufacturers, wholesalers, and retailers to absorb cost cuts in the ultimate price on the product that would, in the very least, partially compensate for the increased cost due to the sales tax.

Have you ever seen a manufacturer lower his price because his costs got reduced due to tax cuts? Have you ever seen a manufacturer lower his price because his costs got reduced for any reason?

Thinking that manufacturers are going to automatically pass on any cost savings to their consumers is a pipe dream of the highest order.

 

[DRZinn]

Thinking that manufacturers are going to automatically pass on any cost savings to their consumers is a pipe dream of the highest order.

Ummm, it's called competition.

 

[Wiley]

Ceetee,

You wrote:

Have you ever seen a manufacturer lower his price because his costs got reduced due to tax cuts? Have you ever seen a manufacturer lower his price because his costs got reduced for any reason?

You, and I, have seen suppliers lower prices due to the elimination of a tax.

Some years ago the federal air travel tax expired. Congress didn't renew it promptly. The airlines, knowing that it would eventualy be renewed, kept collecting it until word got out and there was an outcry by air travelers.

One airline got the message and dropped thier prices, across the board, by the amount of the tax. IN LESS THAN AN HOUR ALL OF THIER COMPETITORS HAD FOLLOWED SUIT.

OK, that little red herring has been gutted, filleted, and cooked.

In addition, Neal Boortz, co-author of the 'FairTax Book', has said that he knows of at least one national retailer that will cut thier prices some WEEKS prior to the effective date of HR25. Any retailer that tries to 'hold the line', tries to 'squeeze' more profit will be toast.

All it takes is one business in a sector to cut prices and competition will force all competitors to match. And to think that any business wants to spend money being a tax collector is illogic of the first order. (You do know that businesses DO NOT pay taxes, don't you? They only collect taxes that you pay?)

[I can see the next argument: The FairTax will get the 'working poor' fired. Even Art's Grandma would use the full spelling of BS on that one.]

Next! One chair, no waiting!

 

[Malum Prohibitum]

To those who doubt the FairTax can be implemented - hey, this was being pushed in 1990 when no politician would touch it. Now, Georgia's John Linder not only sponsored it, but he has many cosponsors and an actual bill.

The only reason it has not been pushed harder is because you have not called and written your Representative and Senator.




www.georgiapacking.org

 

[Derby FALs]

Finally someone else who has read the book and doesn't just jump to conclusions.

Sometimes I get the feeling that alot of people's belief's here are that NOTHING will work or ever make a difference and all we do here is bitch about what's wrong. Instead of seeing how something might make some progress in the right direction we argue about why it is not perfect.... hmmm..

It's like having a thorn in your foot that you pad instead of removing. Is that really progress?

 

[chas_martel]

The FairTax is a shame.

It is just more class warfare.

The FairTax is anything but "fair". It
disproportionately taxes those that
are the most productive. We would still
be left with an "unfair" tax system.

Why does taxing have to be tied to
how much you make? Should it
not be tied to how much you take?

PS: Yeah, I read the book........it is a crock.
Just more of the same ole crap!


PPS: Your first clue should be its name.
Fair should be eliminated from the dictionary, IMO.

 

[HankB]

Have you ever seen a manufacturer lower his price because his costs got reduced for any reason?

Of course not - that's why personal computers are so much more expensive now than they were 10 years ago.

 

[No4Mk1*]

Fair tax sounds great to me.

I am blessed to have a high income and thus I am in a high tax bracket. During the last year I spent about 40 hours directly gathering and preparing my personal income tax which is extremely complicated due to various sources of income and special rules which limit deductions for higher income earners. I spent another 40 hours setting up retirement accounts, pre-tax flexible spending accounts, and keeping records of tax deductable expenses throughout the year. In years to come I may consider reducing my work hours because the current tax code makes it very tempting for me to work part time.

So the current tax code eliminates at least 2 weeks of my productivity every year and is tempting me into early "half retirement."

 

[Phetro]

2005 Federal spending was 2.472 trillion.

Saving ten bucks will put you on your way to paying a $2,472 bill, but not very far on your way.

You're right! That's why we need to cut government spending too. Unless you think they're authorized to spend money on the things they spend money on...

 

[chas_martel]

No4Mk1*, the problem is that the fairtax targets you.

You are being asked to shoulder more of the tax burden.

I like you go thru much work, actually my CPA and lawyer,
to see my taxes completed. But no way do I want
it replaced by the Fair Tax. Ain't no such thing as fair
anyway.

I tell you guys, and gals, the Fair Tax is just more class warfare.
Go read the book if you don't believe me.

It just sits things up for more spending by drunken politicians.

It is not an answer, it is a diversion.


Hank, computers went down in cost when the demand
caused economy of scales to kick in.

No smart business person sets his price based on cost.
That is Sales and Marketing 101

 

[Jeff Timm]

publius commented, "
Quote:
The IRS FY 2005 budget was $10.674 billion. That's a lot of money that wouldn't be needed.
2005 Federal spending was 2.472 trillion.

Saving ten bucks will put you on your way to paying a $2,472 bill, but not very far on your way."

To quote a formerly famous politician, "A billion here, a billion there and pretty soon you're talking real money." Barry Goldwater.

Geoff
Who is a proponent of the Fair Tax!

 

[Jeff Timm]

chas_martel says a whole bunch of stuff that makes no sense, and obviously never read the book as he claims.

Yes, it still taxes the RICH! When the Rich Mr. Smith buys his new Mercedes a Cadillac, he pays Federal Tax on it. Ninety days later when she wants a new one in a different shade of pink, he trades it in and a poor downtrodden worker buys it used and DOESN'T PAY ANY FEDERAL TAX ON IT!

It's a simple little system, in that the taxes we pay now hidden away from view are brought upfront and personal.

Geoff
Who will gladly pay the fair tax as opposed to the IRS taxes which hold the threat of prison. I can always avoid the tax by buying used, but used prices will rise a bit, and used food will never become popular.

 

[Wiley]

Chas,

Which book did you read?

"The Flat Tax Revoloution" by Steve Forbes OR
"Fair Not Flat" by Edward J. McCaffery OR
"The FairTax Book" by Neal Boortz and Congressman John Linder?

If it was other than "The FairTax Book" you have read the wrong book.

The current tax system is a highly progressive INCOME tax system. Thats why you and No4Mk1* and I spend an inordinate amount of time and money to come up with a 'taxable income' that the IRS may or may not agree with.

Steve Forbes would change that to a single INCOME tax rate for all taxpayers. A grossly simplified example would be if your income was $1.00 and the flat tax rate was 20%, your tax would be $0.20. With his plan, you could file your taxes, supposedly, on a postcard. For most taxpayers it would be a vast simplification depending on how and what income is defined. The IRS would still have to exist since the same tax evations would still require investigation and prosecution.

Based on the writeup on Amazon.com, McCaffery's plan would be a progressive CONSUMPTION tax i.e., the more you spend the more you are taxed: up to $20K spent, 0%; the next $60K spent, 15%; above $80K spent would have a 'supplemental tax' of some unmentioned percent. It, supposedly, would eliminate the income, estate and, gift taxes. but still would require the filing of tax returns. It makes no mention of Social Security and Medicare withholding.

Frankly, I am unfamiliar with this plan but from the writeup it sounds as cumbersome as the current income tax system and as socialist i.e., wealth redistribution not by income but by spending. Gotta keep those receipts to prove to the IRS that your spending was below the limit, fill out various spending schedules for vaious limits, etc. and still have some portion of your pay withheld.

The FairTax is not an income tax, it is not a consumption tax. It is a sales tax that would completely replace the current FEDERAL tax system including all withholding for Social Security and Medicare. Every cent you are paid goes into your pocket. YOU choose what to pay tax on when you spend. (Admitedly, buying a used #2 wood pencil just to avoid taxes is a bit silly but Jack Benny would do it.)

AND, to address your objections, Chas, the FairTax would treat every individual EXACTLY the same. No classses, no carveouts, no exemptions, no deductions, the only item not taxed would be tuition.

Of the three schemes the only one that meets your objections is McCaffery's and if you read the writeup on Amazon, you'll see why.

 

[bamawrx]

Any "good" tax system starts with NO REPORTING OF INCOME. Period. Its none of the goverments business how much money you make.

That is the best part of the fair tax. Make as much as you can and be careful how you spend it and you will be more free and in control. That is worth trying, and just think of all the overseas manufacturers that will have to move their operations here to take advantage of the new code!