Posted on 05/20/2008 7:11:25 AM PDT by ReleaseTheHounds
a) those who pay embedded taxes only
b) those who pay embedded taxes AND PIT AND Payroll?
Embedded taxes = PIT + Payroll + Corporate Taxes + Excise Taxes = approx 23% of Cost of Goods and Services
To say that someone pays BOTH to play the fairytax shell game. For an ACCURATE analysis one has to assume either the person who remits the tax pays the tax OR that all these taxes are embedded. This is why Dr. Jorgenson had to pull out the taxes from wages and assume that people are only paid their after tax salary (ie. his assumption workers/businesses don't pay taxes, the consumers do). Otherwise he would come to the bogus conclusion that you are trying to do, and that fairytax.org has been doing for over a decade. The fairtax theoretically collects the exact same amount as the current system, criminals cheat the fairtax almost identically as they do the current system, therefore people end up paying roughly the same as they do now. Under your analysis of counting BOTH, you would come to the conclusion that people under the income tax pay 46% of the costs of goods and services and therefore collects over $4 Trillion dollars. That is not true, and thus your analysis fails.
a) those who pay embedded taxes only
b) those who pay embedded taxes AND PIT AND Payroll?
Embedded taxes = PIT + Payroll + Corporate Taxes + Excise Taxes = approx 23% of Cost of Goods and Services
To say that someone pays BOTH to play the fairytax shell game. For an ACCURATE analysis one has to assume either the person who remits the tax pays the tax OR that all these taxes are embedded. This is why Dr. Jorgenson had to pull out the taxes from wages and assume that people are only paid their after tax salary (ie. his assumption workers/businesses don't pay taxes, the consumers do). Otherwise he would come to the bogus conclusion that you are trying to do, and that fairytax.org has been doing for over a decade. The fairtax theoretically collects the exact same amount as the current system, criminals cheat the fairtax almost identically as they do the current system, therefore people end up paying roughly the same as they do now. Under your analysis of counting BOTH, you would come to the conclusion that people under the income tax pay 46% of the costs of goods and services and therefore collects over $4 Trillion dollars. That is not true, and thus your analysis fails.
Sorry, keep forgeting to turn off italics...
OK then, count taxes by who "submits" them. If you choose to leave embedded taxes in the ether, fine. Then,
Individual taxes [PIT and EE payroll] are taxes "submitted" by individuals.
Business taxes [ER payroll, business income taxes] are taxes "submitted" by business.
Criminals and illegals currently "submit" no individual taxes. But under the nrst, they will. QED.
So you are saying the hooker who collects $5000 pays no income tax under the income tax (true), but under the fairtax will submit the $1150 to pay the tax on her services???? I think you QED a little too quickly.
The counter argument is that there will be a huge black market in order to avoid the nrst.
This is simply stating that human behaviors change based on the incentives that are imposed.
So, the answer is, keep the tax below the “acceptable” level for the public, and they will have little incentive to risk breaking the law in order to avoid the tax.
I believe this article shows what the acceptable level would be - 19.5%.
No, this isn't right - you don't provide anything to buttress this I note.
Again, you fail to accept the fact that nobody says the total collected increases. It is simply that the breakdown of that total changes to include more paid by those who currently cheat the income tax system and less from those who are current legal participants.
In figuring a % of GDP, there is no difference between who buys for consumption. A criminal who buys bread pays tax just like a legal. THe same is not true of our current income tax system.... a criminal "submits" no tax today.
Again, the simple [and I do mean simple] result is that more tax is taken from criminals [and less from legals - resulting in the same total.]
Simply taking a % of GDP is enough to guarantee it. You see, criminals' expenditures are no different than your or my expenditures. THey both count in GDP.
19.5% yes. Interesting, that would be the rev nuetral rate if you include Bush tax cuts. Funny eh?
Also, the nrst takes the EXACT same figure for non-compliance as the income tax does.
I really don’t care about “rev neutral” - because that means that we accept the current level of gov’t spending.
But, if that’s what it takes to get the NRST implemented, we’ll fight the other battles later.
You mean that criminals won't ever buy any new items or services -- they will only buy untaxed used items? Good thinking -- for you.
No, this is your fixation.
Nobody says she will pay tax on her illegal transaction. Let that sink in AR, because this is what is preventing you from seeing what is so obvious.
The tax on that transaction is lost in both systems. This transaction will neither add to nor take away from revenues. Got it?
Now, under the income tax, it's over. No revenue will ever be "submitted" by the hooker on money from that transaction.
But under the nrst, the money from that transaction will be taxed when spent on satin sheets, soap, or lube. Hence, the tax "submitted" by the hooker increases. QED.
‘Western’, yes I agree with the spirit of your argument, but I am not among the moaners and complainers. The Church, along with wealthy city-states and eastern empires allowed for patronage - due to their great power and wealth. Truly there has never been a more generous patron than the Church.
That is what the hooker example precisely does. Let's assume a hooker collects $50,000 for her services.
If she filed under the income tax (she doesn't) it would look something like this:
Gross - +$50K
Minus Bus. Expenses - $10K
Minus Personal Exemptions -
Minus Standard Deductions -
Without looking up these figures, it would probably workout including her self-emplyment taxes to $10-12K that she is suppose to pay, but doesn't.
Under the fairtax:
Gross for her services - $50K
23% that she should remit but doesn't - $11.5K
Under BOTH system, the hooker illegally pockets roughly the same amount. This isn't rocket science. From the criminal perspective, there is no significant difference between the two systems. Really.
Try reading #26 again -- that is if you read it in the first place -- and, of course tht depends on whether or not you Can READ.
That is exactly my position. When we all pay the same marginal rate, all taxpayers [and under the nrst that means EVERY person who buys - which obviously is EVERY voter]...all taxpayers will be united in opposition to any increase and all taxpayers will be united in support of any decrease. All until a spending/taxing level is acceptable to everyone - BTW everyone will pay the same marginal rate.
You’re wsasting your time with that one. That has been explained to him/her/it dozens of time, with absolutely no effect, and it has become quite obvious that he/she/it either cannot read, cannot understand the English language, or both.
Nope! It doesn't imply it -- it plainly states that fact. It was 90% and the Dmocraps were even trying to raise that.
Really, if you include the bold, this is what everyone is already saying. Why can't you get beyond that? We all agree on that.
The next thing for you to do is to compare what happens to her earnings next under both systems. Under the income tax, those earnings are never taxed. Under the nrst, those earnings WILL be taxed.
So under the income tax, the hooker pays zero. Under the nrst, the hooker pays some when she consumes using that illegal money.
So it is trivial that the nrst collects more from this hooker than the income tax. QED #3
Well, I think AR is reasonable - but is blinded by emotion a bit. He’ll get it. He won’t ever like the nrst, but he will end up admitting that legals will pay less under the nrst and criminals/illegals will pay more.
1. Taxes are paid by the consumer. Jorgenson embedded tax model. Prices after the fairtax stay the same. Businesses and employees make current after tax income.
2. Taxes are paid by the businesses/workers. Prices go up after the fairtax is enacted. Workers and employees keep their current gross income.
Once you stick completely to one of those assumptions, then you will do a fair analysis and reach the correct conclusion. Otherwise, enjoy your time in fairyland.
For an ACCURATE analysis one has to assume either the person who remits the tax pays the tax OR that all these taxes are embedded.
I did that. I assumed that business remits and pays ER payroll and business income tax and that individuals remit and pay PIT and EE payroll - just as you required.
Why don't you admit you're wrong? It doesn't mean you support the nrst. It just means the nrst will indeed allow those who currently legally particpate in the income tax system to pay less... because criminals and illegals will pay more.
It's just one small piece AR. Don't become a namecaller - just do what's right.
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