Would you not agree that the cost of state and local governments paying sales tax (would have been $360 billion in 2001 - even with the
mythicalminimum 20% drop in prices it still would have been $293 billion ) will be passed on to the taxpayers.
Thanks, $360billion to $293billion reduction in state expenditures you say? Hmmm, an improvement by my standards, since one must note those burdens are implicit in the prices those state & local governments pay for consumption now, and thus are embedded in the taxes you pay them today.
Won't these federal taxes be "embedded" in our state & local taxes the same way corporate taxes are currently embedded in prices?
Seeing the NRST will be collected by the state as well, embedding in taxes paid by the individual for which he recieves a detailed receipt has little meaning don't you think?
The issue of embedding is one of visibility of the whole tax burden on the individual, (i.e. the measure of cost of government to the citizen). You wish to reform the state tax systems to create more visibility for the citizen of your state above and beyond what the NRST can provide for federal tax on the individual. I won't stand in your way.
Tax embedded in a tax? The issue is visibility of taxes burdens because we cannot perceive nor properly distiguish the role of government from business on consumer prices.
The goal of the NRST is to provide a visible federal tax system, that the electorate may act out of knowledge as regards federal government cost in their personal lives, and to put greater distance between the family and federal government where the collection to taxes is concerned.
To get the NRST legislation even to the floor of Congress it must conform to the Budget Enforcement Act provisions of revenue neutrality for one as measured agains the current tax law by CBO methodology. The provisions in the NRST bill accomplishes that goal by allocating taxes between public and private sector expenditures in the same proportions as tax burdens are distributed today that it's primary goals may even have a chance for enactment.
The CBO methodology mandated through the Budget Enforcement Act does not allow a dynamic analysis of tax law impacts on the economy to establish the tax rate, thus the language requiring taxes on the sale of goods to government as well as the citizen becomes necessary as government today pays taxes through its purchases of goods and services via income/payroll taxes embedded in the price of goods and service.
Saying its stupid will not change political reality, to reform tax law political reality must first be served.Once a system is in place and the calculus changes then modification becomes possible. The initial legislation repealing one tax law and replace it with another, must meet the Budget Enforcement Act requirements of revenue neutrality and all the dumb rules it demands.
All it takes is one Congress Critter's point of order to kill a bill that cannot meet the CBO measure of neutrality. That is where you get the liberal chant of "paying for tax cuts" which is just a coded way fo saying prove it's "revenue neutral". Why true cutting of taxrates not offset somewhere else in the tax code by closing deductions etc. nigh to impossible. with the prime maxim of politics being:
A government which robs Peter to pay Paul can always depend on the support of Paul.
-George Bernard Shaw
As long a government can keep Paul believeing that it is Peter paying the freight,
"It's like me in the restaurant: What do I care about extravagance if you're footing the bill?"
Walter Williams