Posted on 03/17/2011 3:59:49 AM PDT by xtinct
There is a simple alternative interpretation: a strategy of fighting one battle at a time. You can't claim this to be naive; great many strategoi did just that and fought on one front at a time.
Considering the layout of power, one may estimate that a simultaneous reduction and simplification of taxes may not work: no chance of passing. If so, first simplifying and subsequently trying to reduce taxes is a viable strategy.
Assuming the worst without a shred of evidence is neither fair nor logical.
Yes, that's nice. But will it "nail" wisely?
Sales tax will constitute a larger proportion of a poor man's income than of a wealthy one's. Is that fair, reasonable, wise in your opinion?
What gimmicks are available to Google that are not available to you?
and tariff’s on all imports.
How do you know it's going to work? You don't tell us a word. There is plenty of evidence that it would not work.
Shrink government to the size it’s constitutionally supposed to be,
I am not a constitionalist scholar but, as far as I know, the Constitution does not specify the size of the government.
We should be able to opt out of ALL Federal taxes (by not purchasing a good). That is truly the American way.
You cannot credibly opt out of purchasing a public good. You can _say_ you will not purchase it, but you cannot credibly promise that. This has nothing to do with being American.
That's where I differ on how the FairTax handles such a thing. Many states which impose retail sales taxes exempt things like unprepared food, clothing, medicines, and services which are considered life critical. The FairTax gives each household a "prebate" which covers the costs of these taxes for everyone. I believe the prebate is unworkable given that our government can't really do anything right, so I prefer this approach instead. The approach of exempting certain items from the tax also prevents the government from stealing your prebate just in case you decide you do not want to buy the health insurance that it thinks you should buy.
But for people who can afford to pay for things like $200 Nikes, the latest and greatest Smartphones, cable TV, broadband Internet, and other such luxuries, but who otherwise do not pay federal tax, they can afford to pay something towards the cost of government.
The Fair Tax sounds moronic and the sales tax would likely morph into a VAT tax, plus it would not stop them from bringing back the income tax plus the VAT tax in the future.
A flat tax or at least a flatter tax is the best way to go.
But the “revenue neutral” thing always bugs me.
The point is that, once you start getting into the details of which categories should be exempt, the same thorny issues arise, and you are end up with something unwieldy if you consider them or something unwise or unfair if you don't.
Oh, and I forgot to add: a poor person will spend a greater proportion on taxes even if you exempt food. The original question remains unanswered thus.
There, FIXED.
Agreed. I don't believe there will be a solution that is completely fair, aside from a 0 rate for such a sales tax. The other issue I have with the prebate is that a fixed cash payment to every household to cover the cost of the tax for "needed items" will put people who live in high cost states at a disadvantage. It will result in those people getting less value for their prebate than people in low cost states. That's another thing that exempting certain items from tax does address.
” we really should be scrapping it, not mending it.”
We are mending a flaw which was intended to stop a flaw which was intended to fix a problem which was hoped to create a more fair tax flaw which was hoped to fix a glitch which originally was inserted to hide a paragraph which totally f**ks the taxpayer!
There! I fixed the issue!
Please don't misunderstand me: I am not suggesting that sales tax OR the Fair Tax are without merits. I just would like to hear how sales-tax proponents adress the mother of them all --- the fact that poor people pay more of sales tax (in proportion) than wealthy ones. Aside from fairness, it is also a practical question: how can you expect to persuade people if you don't address their main concern?
10% PURE flat income tax. No deductions, credits, loopholes, allowances, - NOTHING. Everybody pays the same rate.
By either exempting the first $X of purchases (the way the FairTax does) or exempting certain purchase from a national sales tax, you do prevent the poor from paying tax. Of course, most of us define a poor person as someone who, if he can buy anything, can afford only the most basic of essentials. Far from harming such people, both my proposal and the FairTax would help these people because there would be no federal tax withheld from such persons' paychecks.
Under either proposal though, anyone who would make a purchase that would result in paying either a national retail sales tax, or the amount of sales tax charged under the FairTax beyond the level of prebate, isn't poor.
Consider a person with income Y. You exempt the first X of purchases P from the sales tax and tax the remainder at the rate R. The person thus pays R(P-X) in taxes, that is, proportion R (P-X) /Y of her income.
Regardless of what X is, this proportion decreases with Y: wealthier people smaller proportion of their income.
This is the main argument against the sales tax. How are you going to persuade people that you are right if you don't address this concern?
Except that it isn't.
First, to implement a prebate, you would have to track down and inventory every person in the USA. You would have to determine their legal status. How would you handle households of people, married people, etc. The fact that our government can barely do anything is going to open this up to fraud. On top of this, how are you going to do this without a massive federal bureaucracy, like the IRS? Heck, there's already a schedule for varying prebate amounts based on what type of household you have. How would that schedule be subject to any less of a "lobbying feast" than my suggestion?
Second, what if $X is enough to cover basic needs in low cost states but not high enough to cover those needs in high cost states? You end up with low income people in high cost states being screwed. If the prebate is too high, then people in the low cost states get what amounts to a welfare check from the government.
Third, what if a president decides that if you do not agree with his particular pet policy, you don't get your prebate? We already have the same problem with 0bamacare and tax refunds.
I understand the merit of the arguments for the prebate, but I just don't think it is workable in a practical sense, for the reasons above. Besides, why don't states which have sales taxes use prebates for their sales tax?
How do you figure? Can you provide objective evidence that backs that up?
Under my plan, it is the taxpayer who has the ultimate choice. If you don't want to pay tax on an item, you don't buy it. Done.
You're back to the absurdity of a tax break for caviar and champagne.
And who are you to decide if someone who has the money shouldn't be allowed to enjoy the same tax break on food that someone of lesser means enjoys? That sounds a lot like the justification used to raise marginal income tax rates, that they can just afford to pay more.
BS to caps! Let’s not allow ourselves to get caught up in that trap.
Taxes collected should not exceed the cost of governing. This cost is not infinite, finite or always predictable. Getting a handle on spending includes many components:
1. Congressional salaries.
2. Congressional benefits.
3. Congressional staff sizes.
4. Limiting Congressional expenses.
5. Top to bottom review of all existing “entitlement” progams for need; duplication and fraud waste and abuse.
6. Limiting lobbying influences.
7. Eliminating current tax structure in favor of a flat tax.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.