Posted on 02/17/2008 7:34:33 AM PST by DivaDelMar
As long as there are democrats, the fair tax is a VAT.
Have you read the book and tried to understand it?
As the long as the Income Tax (sic) is enshrined in the Bill of Rights..(now there is a chuckle worthy topic) then any law imposing the Fair Tax can be coupled with increased income (sic) taxes, there is no getting around that fact.
In other words, any way you want to tax it, it come out to be - one day we will all own an outhouse because a toilet will be too expensive!!
Fair Tax ping!
See post #9. I never knew Kotlikoff has come out so cleanly that wages must fall for prices not to rise. But there it is.
ping
The prebate goes to all, not just the poor. The Prebate will allow all to buy essentials effectively tax-free.
The Fair Tax is 23% on a tax inclusive basis. The tax-inclusive basis is analogous or comparable to the way we conceptualize the income tax.
The Fair Tax is 30% on a tax EXCLUSIVE basis. That is the way we typically conceptualize sales taxes. Let’s do the math to demonstrate:
If you have $1 to spend, you can buy .77 worth of goods and you will pay .23 in sales tax. On a tax-inclusive basis, that is a 23% tax. 23/100 = 23%.
On a tax-exclusive basis, where the value of the goods purchased serves as the denominator or the basis upon which the tax is calculated, the rate is 30%. 23/77 = 30%.
SAME NUMBERS, DIFFERENT ways of calculating the rate provide different results. THERE IS NO INTENT TO DECEIVE.
Let’s approach this from a different perspective. I you want to buy an item that costs $100, how much do you have to earn under the income tax system to permit you to buy the $100 item? If your marginal effective Federal Tax Rate is 23%(15% FIT, 7.65% FICA/Medicare(rough justice 8%)), the answer to that question is $130. Let’s do the math.
$130 gross x 15% = $19.50
$130 gross x 8% = $10.50(rough justice)
NET PAY: $130-$19.50-$10.50 = $100
IS that a 23% tax or a 30% tax?
False. Please cite the section of the Fair Tax Bill that gives the sales tax enforcement agency (The STATES, not the IRS) the right to audit consumers.
And that differs from the current system, how, exactly? Congress can raise the income tax rates anytime it cares to and we are virtually powerless to resist. Not so with consumption based taxes.
From Federalist No. 21:
“...It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess. They prescribe their own limit; which cannot be exceeded without defeating the end proposed, that is, an extension of the revenue. When applied to this object, the saying is as just as it is witty, that, ``in political arithmetic, two and two do not always make four.’’
If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them.
Impositions of this kind usually fall under the denomination of indirect taxes, and must for a long time constitute the chief part of the revenue raised in this country....”
Oh please, you are promoting a sales tax, and everyone adds the sales tax to the amount. Computing a tax the non standard way is meant to deceive.
The Bill was written to include a prebate, instead of exempting certain items, for several reasons.
1. Giving the government the power to determine what is or is not a necessity transfers power back to them by giving them an opportunity to sell “exemptions” in exchange for campaign cash. Taxing everything while providing a prebate removes the power of K Street lobbyists.
2. Providing every legal resident with a prebate provides the greatest possible choice to the individual. My market basket of necessities may be and probably is different from your market basket of necessities. With the prebate, we are free to choose what we wish to purchase effectively tax free.
3. Without the prebate, the tax is truly regressive and the Democrats would NEVER allow it to pass.
In summary, the prebate provides the individual with the greatest possible choice, removes the influence of lobbyists and allows the Fair Tax to be more progressive than our current system.
Incorrect. The rate is quoted both ways to facilitate comparison to the income tax. A 30% sales tax is equivalent to a 23% income based tax. There is no intent to deceive, rather advocates wish to provide a valid basis of comparison. A 30% sales tax is NOT equivalent to a 30% income tax and those who don’t think about this at any depth would equate the two. In a rush to judgment, without a valid basis of comparison, most would dismiss the proposal out of hand as a tax increase. That is false.
I will not benefit. As a CPA/Tax Attorney/Estate Planner, my business will suffer.
My interest in seeing the Fair Tax enacted is simple. It is the best thing for the country and it will free my children and grandchildren from the insanity and slavery of the income tax.
And what is your interest in preserving the status quo?
why should the poor be exempt from sales tax on essentials while the middle class and rich are not.
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Everyone gets the prebate ,, whether you’re working at McDonalds or if you’re Donald Trump... it is simply based as a percentage of the income denoted as the “poverty line” for each family size.
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