It looks like he's starting with 18.4% (and it goes up from there) and I don't see a demogrant in the details. That's not the FairTax.
Nice try but no go. The tax modeled were indeed the Fair Tax Act provisions, simulated to estimate the revenue neutral rate for the Fair Tax Act, against the taxlaw in place during the Clinton Administration.
Jorgenson's model is limited and the results are flawed, particularly in the short term.
LOL well then we'll just take a look at the long term limits as they compare to those short term ones:
5.Since producers would no longer pay taxes on profits or other forms of capital income under the NRST and workers would no longer pay taxes on wages, prices received by producers, shown in the sixth chart,would fall by an average of twenty percent.The seventh chart shows that industry outputs would rise by an average of twenty percent with substantial relative gains for investment goods producers.
6.In the long run producers’ prices, shown in the eighth chart,would fall by almost thirty percent under the NRST.In addition,the shift in the composition of economic activity toward investment and away from consumption would drastically redistribute economic activity among industries.The ninth chart shows that production would rise in all industries,but the increase in production of investment goods would be relatively greater.7.The imposition of the NRST would produce a sharply higher tax rate on consumer goods and services, but the tenth chart shows that the initial consumption tax rate would be twenty-three percent at both federal and state and local levels or only 18.4 percent at the federal level. This would gradually rise over time,but remain below thirty percent or 23.8 percent at the federal level.
And that is in comparison with tax law as it stood in 1996. Over a charted 25 year range from 1996 through 2020 the numbers look quite consistant. Don't see a problem other than the NRST rate does appear abit high to my liking.
Fortunately tax laws manage to change with new administrations, so the NRST rates will be even lower with the current set of tax cuts made permanent through the efforts in this second Bush term.
I know, that just set your teeth on edge and grinding, but that's the breaks.
It also needs to be pointed out again that Jorgenson has since realized that his "revenue neutral" rate isn't revenue neutral at all. It would have to be much higher than even the AFT proposed rate.
Nahh, that's just Jorgenson being lazy and using Gale as an alternative claim to what Jorgensons Fair Tax Act simulation shows. To bad but there are too many similar calculations from several sources all showing the revenue neutral rate to lay between 21 and 25% under the Clinton administration tax law.
With the current administration's mindset to make permanent cuts, no problems at all. Course there isn't a problem anyway, as any legal requirement for revenue neutrality in the enactment of revenue bills died in September of 2003 to remove artificial impediments to permanent tax cuts in any case.
You just as well get over it YN, rates for the NRST and current tax law are going down and you will just have to cry alot I guess :O)
from Tax Freedom Day 2004 PDF http://www.taxfoundation.org/sr129.pdf
|
Total Effective Tax Rates by Level of Government |
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| Year | Federal | State | Total |
| 1998 | 22.4% | 10.4% | 32.8% |
| 1999 | 22.5% | 10.4% | 32.9% |
| 2000 | 23.1% | 10.4% | 33.5% |
| 2001 | 22.2% | 10.5% | 32.7% |
| 2002 1 | 19.7% | 10.2% | 29.2% |
| 2003 2 | 18.5% | 10.1% | 28.6% |
| 2004 3 | 17.9% | 10.0% | 27.9% |
| Notes: Leap day is omitted to make dates comparable over time. Positive and negative percentages in parentheses after legislation indicate the first-year fiscal impact of the bill,measured as a percentage of NNP. Since depreciation is not available to pay taxes, GDP is an overstatement of spendable income for the purpose of measuring tax burdens. Depreciation is netted out of NNP. 1 Economic Growth and Tax Reform Reconciliation Act of 2001 Sources: Office of Management and Budget; Internal Revenue Service; Congressional Research Service; National Bureau of Economic Research; Treasury Department; and Tax Foundation calculations. |
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Good night! and sleep restlessly, we pay the national debt off with your next pay check ;O)
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Nice try but no go. The tax modeled were indeed the Fair Tax Act provisions, simulated to estimate the revenue neutral rate for the Fair Tax Act, against the taxlaw in place during the Clinton Administration.It's not the same rate and it has no demogrant. It's not the FairTax.
LOL well then we'll just take a look at the long term limits as they compare to those short term ones:It's also flawed in the longer term. It's also interesting to see how later version of this paper have changed in their results. The one paid for by the AFT seems to have much greater result than more recent versions. Interesting...
Nahh, that's just Jorgenson being lazy and using Gale as an alternative claim to what Jorgensons Fair Tax Act simulation shows.How do you tell when Jorgenson's being lazy or not? It is that when he says something that doesn't support your position he's being lazy?
You just as well get over it YN, rates for the NRST and current tax law are going down and you will just have to cry alot I guessRight. What ever happened to that big Congressional Research Service study of the rate? Didn't go well? This isn't what you were talking about, is it? Because it doesn't have much good to say about a NRST. And it really looks down on trying to predict the outcome of tax changes with intertemporal models like Jorgenson's. Guess what? It turns out they aren't very realistic. Surprise.