Posted on 03/02/2004 10:23:45 PM PST by esarlls3
Congress Must Pass the Fair Tax Act
By U.S. Rep. Mac Collins
CNSNews.com Commentary
February 27, 2004
Past Congresses have moved in the wrong direction by making our tax laws more complex and expensive for business and individuals to comply with. To keep our economy growing, Congress needs to take action now.
My colleague, Georgia Republican Congressman John Linder, has sponsored the "Fair Tax Act" (H.R. 25), a national retail sales tax on new goods and services. It would replace all individual and corporate income taxes, payroll taxes as well as capital gains taxes, estate taxes and gift taxes.
The Fair Tax replaces the way we are currently taxed, which is based on our annual income, with a tax on goods and services. The Fair Tax, basically, is a voluntary "consumption" tax. The more you buy, the more you pay in taxes. The less you buy, the less you pay in taxes.
The federal government will continue to be fully funded, including Social Security and Medicare.
The Fair Tax will reduce the costs of goods and services by 20 to 30 percent. It will allow workers to keep 100 percent of their paycheck, pension and Social Security payments with the exception being state or local withholding
The Gross Domestic Product will increase by almost 10.5 percent in the first year after its enactment because real wages would increase and tax compliance costs for business would decrease by 90 percent.
The fair tax would also be good news for investors. Real investment will initially increase by 76 percent relative to investments that would be made under our present tax laws. While this increase will gradually decline, it remains 15 percent higher than under the existing tax structure.
American exports will increase by 26 percent initially and would remain more than 13 percent above present levels under the current tax system.
Studies of the Fair Tax have shown that many U.S. companies will choose expansion here in the United States versus abroad, and in turn the United States will become more attractive to many foreign owned companies looking for expansion possibilities.
President Bush, during his State of the Union address in January, said the economy is turning around because the American people are using their money far better than government would have. The Republican majority in Congress was right to return it to the American people and not keep it in Washington.
A fresh and a fairer approach to a Federal tax system is needed. Therefore, it is time for Congress to pass the Fair Tax (H.R. 25).
As a cosponsor of the Fair Tax Act, I have asked Chairman Thomas of the Ways and Means Committee to hold hearings on this vital legislation. I am hoping those hearings will get under way in the near future.
(Congressman Mac Collins is a Republican representing Georgia's 8th Congressional District. He serves on the House Ways and Means Committee and the House Select Committee on Intelligence.)
Oh, but I do. I've never missed an election in 32 years. I have yet to vote for anyone who won, though...
Course one can continue to pick for perfection and get nothing.
But power is a very seductive drug...
LOL, I don't think you are in much danger yet.
What can I do to get the message out?
FR's a good place to start and to learn, followed up by informing family, friends, associates, anyone who will listen.
Check out these folks,
Either will be more than happy to have you participate at any level suits you, they have materials, congressional mailing lists, phone numbers etc.
Bullshit, it's a lie and it's mathematically impossible.Taxes are imposed on gains and profits. Anyone still in business knows they aren't paying 20 to 30 percent of their gross in federal income tax.
Service employee's will get 100% of their paycheck(s) too, which part of a service will be reduced 20 to 30 percent?
What we do know is prices would go UP 30%..
"The federal government will continue to be fully funded, including Social Security and Medicare." and you'll be able to save your money like never before, prices will be reduced 20 to 30%, AND, in addition to all that pie in the sky BS, every household will get a magic check in the mail every month from the government to boot...right.
Why would the same administration praising the exodus of jobs as good for America want to stop them with a radical change in the tax system?
Don't you know the exodus of jobs will raise the standard of living for all Americans?...We're all gonna be CEO's soon...Let the little people worry about THEIR taxes.
Bullshit, it's a lie and it's mathematically impossible.Taxes are imposed on gains and profits. Anyone still in business knows they aren't paying 20 to 30 percent of their gross in federal income tax.
You overlook payroll taxes lewislynn, which are also repealed under the NRST. The combination of repeal of both income and payroll taxes along with the reductions of the costs complying with those taxes make up the reductions in producer goods that make reduction in retail prices possible.
The following article covers the mechanism on how the current Federal tax system propagates and is embedded into consumption expenditure.
DO YOU PAY YOUR INCOME TAX
AT THE SUPERMARKET?
by D. Sherman Cox J.D. L.L.M. Taxation
The 24% in the article considers only those factors actually paid to government out of imposititions on business in complying with the income, payroll, excise & tariff tax laws.
I refer you to the section of the following article about the Income/Payroll tax system and its impact on our economy "A. Hidden Upstream Taxes. " paragraph 39.
"[39] Dr. Dale Jorgenson, Chairman of Harvard University's Economics Department, believes that the price of goods and services are inflated by about 20 percent or more by upstream taxes consumers ultimately bear. In a recent paper Dr. Jorgenson estimated the built-in taxes contained in the price of goods and services. /22/ In the chart above, he quantified the hidden component of tax, estimating that producer prices would fall on repeal of upstream taxes an average of about 22 percent."
Looking at the accompanying chart, the range of values from industry to industry appears to be about 12-25%.
Economists Gary and Aldonna Robbins of the Texas-based Institute for Public Policy examined the case of dry cleaning a shirt, with a particular eye toward uncovering the hidden costs of taxes in price.
The Robbin's attributed over 33.6% of "consumer prices" to be due to federal taxation passed on to the customer.
The Federal Tax System
http://www.cbo.gov/showdoc.cfm?index=2125&sequence=0&from=1#pt1
From the Table 1 we may extract the proportionate contributions of each sector of taxes as they contribute to consumer price for the year 2000.
Those tax components which will not change prices as a consequence of enactment of HR25
============================
Adjust for the approximate reduction of interest & cost of tax compliance (
Adjust for a conservative $800 billion cost of tax compliance, Payne '95 estimates 65cents for each dollar of revenue collected, $1264billion) reductions .
Estimated change in consumption prices as consequence of enactment of a National Retail Sales Tax, repealing all business income and payroll taxes:
33.6*(1386.5/1945) = 23.9% reduction in consumption prices
Which more than verifies the Jorgenson empirical study of 22% fall in producer prices.
The two sources are in reasonable agreement, and I see 20-25% a reasonable value to expect retail prices to fall, not only for customers here in the United States, but in our exports as well making them far more competitive on international markets.
Yes, but it would be much fairer for decades. When it gets too bad we replace it with a simpler flat income tax...
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