Posted on 09/27/2004 2:41:31 PM PDT by LowCountryJoe
The most popular of the various national retail sales tax plans is called the FairTax. It is in both houses of Congress today as HB 25 and SB 1493. It is a replacement, not an add-on, for the federal income tax and for federal payroll taxes collected to fund Social Security and Medicare.
The FairTax provides a dollar-for-dollar replacement of all revenues now collected through such taxes and eliminates the need for annual and quarterly income tax filings, the surveillance by the federal government of wages and investment income and the need for anyone to hire an expert in order to comply with federal tax laws.
The FairTax is a progressive tax. The biggest-spending wealthy will pay an effective tax of $23 for every $77 they spend on new products and services. The poorest get money back. American families would receive a monthly refund equaling the amount of sales tax a poverty-level family would normally pay.
As such, the FairTax eliminates federal taxes on the poor, including highly regressive Social Security taxes. This automatic refund won't mean much to the wealthy but will be quite significant to low- and moderate-income families and to those on fixed incomes. Everyone receives the refund, including the wealthy, in order to eliminate both means testing for the poorest Americans and the need to track earnings for everyone.
The FairTax has no exemptions, no shelters and no complex tax dodges available primarily to the wealthy and special-interest groups. The only thing every taxpayer can know about the current tax code is that it is an 8-million-word mess that no one has ever read. But even a child can understand the 13 words that define the FairTax: "The FairTax is applied to all new goods and services delivered at retail."
The FairTax captures billions of dollars of revenues currently lost in the underground economy. Even drug dealers would pay their share of taxes when they purchase goods and services. The simple fact is, the more money one spends under the FairTax, the more consumption taxes one pays. Those who buy luxury items pay more; those who live more modestly pay less.
The FairTax also eliminates the IRS' unwelcome surveillance of every penny of income earned, loaned, won or invested by American citizens. In place of the huge bureaucracy created to collect federal taxes, the FairTax uses the states' sales tax infrastructure to collect taxes at the point of retail sale.
The intrusive interest from our government into citizens' financial status is eliminated overnight.
We can achieve the dream of upward economic mobility for all if we first believe our goal is attainable. The FairTax — truly an issue that delivers on the promise of individual liberty — will survive the distortions of presidential politics, and with a demanding public, the FairTax will achieve the congressional passage and a signature from the White House. It all starts with telling the public the truth and believing we can change things. I believe.
• Herman Cain also has served as chairman of the Federal Reserve Bank of Kansas City and as CEO of Godfather's Pizza. He recently ran for the U.S. Senate from Georgia.
the Oprah "free car" incident proves Americans would better
off knowing the true cost of taxes. These people didn't have a clue.If we didn't have payroll withholding taxes and
people had to make out a yearly or quarterly check, there
would be a tax revolt, but since half the population doesn't
pay any tax and gets a "rebate", they don't care.
It would be wonderful if they would pass it, but I have a feeling that some of the fat cats who have set up deductions to benefit themselves and their high dollar donators will put the kibosh on it.
My quick scan doesn't pick out how they plan to do this. But I believe that this proposal only taxes big ticket items above $500, so as to "tax the wealthy".
Anyone who works in manufacturing in the US had best squeel loud about this. It will complete the destruction of manufacturing in the US, as most such items are above $500.
I can see an economy dominated by $499 items, convienently combined to make something that would cost more. Motorcycles sold with frame and engine separate. Airconditioner "kits" sold in pieces. Etc.
This is a mess and will be worse than what we've got.
GO MR.CAIN
see www.fairtax.org
Great site to promote the Fair Tax
The Golden Rule = those with the Gold, Rule.
Not true at all. See fairtax.org for details.
Fairtax ping
How would drug dealers pay their fair share if they don't report their illicit income and qualify as one of the poor who get their money back? Am I missing something?
A replacement! YESSSS!!!!!
If the tax is collected at the time of purchase, even drug dealers would pay. All underground income would then be subject to the tax when the money was spent. But to be fair and remain revenue neutral, the percentage should be reduced as government costs are reduced. (e.g. no further need for the tens of thousands of I.R.S. employees now working in compliance and collection.)
There would still be the onorus federal bureaucracy to make certain all the tax was collected and many forms would have to be filed to make certain we have purchased enough taxable goods to have paid our "fair share."
Rebates would have to be made to the "working poor" so that they could purchase more goodies.
I'm in favor of taxing lower income workers at a higher rate than the upper income workers in order to get the lower income workers to get off their dead arses amd PRODUCE!
Oh, please.
This is a dumb thing to be talking about at election time.
And WHO is pushing this? democRATS are saying it's Dubya's
idea, and they're supposedly convincing lots of undecided's
to vote RAT party because of this!!!
This whole idea should only be broached at TAX TIME, and
ONLY if it combined with a repeal of the amendment that
gave us the INCOME TAX + permanent dismantlement of the IRS.
(so basically its almost certain to never happen)
the lifetime self employed like me have known all of this for a lifetime...
however...a flat national sales tax doesn't do much for me....I already pay 10% sales tax to Tennessee and huge property and F&E taxes on my investments...and I max out FICA of course
...a flat national tax of 25% with no deductions would probably be worse for me
for the paycheck crowd...it might be better if they are in the higher brackets
"Oh, please."
I gather you're thinking drug dealers would collect sales tax from the users? Of course not. But they have to buy cars and food and gas and beer like everyone else, so their drug money gets taxed when the spend it.
Now, of course, one of the 'perks' to working under the table or on illegal things is you dodge the income tax.
But being as how the US is the most successful economy on the planet, and we've been saddled by this income tax for decades, I'll have to be seriously convinced that somehow this is "better" before I'll support it.
The fact that it's "progressive", is enough to make me skeptical already.
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