REPUBLICANS PLAN PUSH FOR ELIMINATION OF IRS

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[phil_will1]

"HP was #17 on the Fortune 500 that year but the full-time equivalent personnel engaged in federal tax compliance was only 3."

Nice try. The total number of personnel involved in tax return preparation was 3. I didn't see how many people or how much in consulting was spent on tax planning (i. e. tax avoidance).

Also, this paper points out in its first few paragraphs that it is "anecdotal", not a formal study. IOW, a sample of one may or may not be representative.

Here's another anecdotal story. Shortly after Enron's troubles became public, I read a story that Arthur Anderson had billed them somewhere between $50 and 100MM for consulting for the year preceding the discovery of their financial problems. I would be willing to bet that much of that was on tax consulting.

Think $75 MM a year (give or take a few mill) is "chump change"?

[smokeyb]

Payroll and income taxes is a no brainer. Divide what I paid by what I made.

Obviously a no brainer for you. You don not pay one flat percentage on your income - It's a GRADUATED TAX ! Try checking you little IRS book and look at the tax tables.

[Your Nightmare]

Obviously a no brainer for you. You don not pay one flat percentage on your income - It's a GRADUATED TAX ! Try checking you little IRS book and look at the tax tables.

And what exactly do you think that would tell me? If I divide what I paid by what I made I get my effective tax rate. Do you think I should be looking at my marginal rate for some indication of how much I paid?

[smokeyb]

If I divide what I paid by what I made I get my effective tax rate.

What you made or your gross TAXABLE income ? You never know your final "effective tax rate" until you do your return. Do you know right now what your "effective tax rate" will be for year-end 2004 ? No way.

[Your Nightmare]

Do you know right now what your "effective tax rate" will be for year-end 2004 ? No way.

No way. That's not what we were talking about. We were talking about 2003. I wouldn't know my effective rate with a NRST until the end of the year either

[YankeeReb]

Now consider that a flat tax, national sales tax, or VAT ...

If Bush would make this a campaign issue the electon would be over. The one thing I would worry about is that congress would get hold of this bill and as a "comprimise" we'd end up with BOTH a VAT and the current income tax. I'd love to see the NRST adopted but ONLY if it goes along with a repeal of the 16th ammendment, which sadly will never happen.

[smokeyb]

I wouldn't know my effective rate with a NRST until the end of the year either

Your rate is the same percentage no matter how much you spend. Why would you have to know what the rate is in comparison to your wages? It's right up front for you to see when you purchase any new goods or services.

Right now if you make 72,000 you pay FIVE different percentage rates ! Sure you can "average it out" but it is never on your earned income it is on your TAXABLE income.

[ancient_geezer]

But I've shown you're wrong.

"(Includes the tax code, tax regulations, various IRS rulings)"

The number of pages in the CCH Standard Federal Tax Reporter includes more than federal tax rules, tax code, tax regulations and various IRS rulings. You are wrong.

You are wrong in assuming that the term "Includes", does not allow indexes and CCH annotations and tables.

However, I will concede that I did not bother to go beyond the Cato's characterisation [10 Outrageous Facts About the Income Tax] of that chart demonstrating growing complexlty from the very beginnings of the income tax body of law.

For I do not find the specific number of pages included to be all that interesting except to demonstrate the overwhelming and growing complexity of a tax law that requires not only the volumes of the CCH Standard Federal Tax Reporter, but the plethora of additional IRS publications, thousands documents of caselaw in addition to the indexes published by CCH.

Indeed the just comparing the [First Form 1040 - Year 1913 - Tax Form Processing LLC] requiring two pages of forms and instructions backed up by 14 pages of law with subsequent versions through the years more than amply demonstrates the point to be made.

Today, the Internal Revenue Code exceeds 1.3 million words; the tax regulations themselves another 5.75 million. The current 1040, has grown evermore complicated where by 1935, the 1040 consisted of 34 lines, with just two pages of instructions, by 1998 the form reached 69 lines backed up by 101 pages of instructions, or a little less than one page of instructions for each line of the 1040. With the 1040 only the beginning where today, there are more than 700 different tax forms.

refer: http://www.house.gov/burr/NEWS_link_editorials_taxtime.htm

Any way you look at it, not only is the Income tax complex, its complexity has been growing throughout it 100 year history which is what the graph of CCH Standard Federal Tax Reporter pages, by Cato, is intended to demonstrate.

[Your Nightmare]

Your rate is the same percentage no matter how much you spend.

Not my effective rate.

[Bigun]

An economic genius he ain't!

Corporate income taxes do NOT raise prices to consumers.

17 Posted on 05/28/2001 12:35:21 PDT by Willie Green (Go Pat Go!!!) DO YOU PAY YOUR INCOME TAX AT THE SUPERMARKET?

[EternalVigilance]

Heh...

[Your Nightmare]

Who pays corporate taxes and how much is a matter of much debate among economists with no clear conclusion.

The central problem with the corporate income tax from an economic point of view is that, ultimately, only people can pay taxes. Economists have had great difficulty in assessing the incidence of the corporate tax—that is, on which groups of people the burden falls. As early as the seventeenth century, Sir William Petty, one of the progenitors of modern economics, argued that a tax on the production and sale of commodities would eventually be shifted by producers to consumers, who would pay it in the form of higher prices. Later classical economists disagreed, contending that the tax fell on owners, making it, in effect, a tax on capital. They thought it could not be shifted since, theoretically, a corporation already charging prices that produce maximum profits could not increase prices further without reducing the amount of its goods that people demanded.

Modern research has returned, in part, to Petty's view. A tax on corporate income will cause some firms to leave the business. This reduces the demand for labor, which reduces wages and reduces the supply of goods produced by corporations. With the supply of goods reduced, prices rise. Thus, part of the corporate income tax is paid by shareholders, part by workers through lower wages and fewer jobs, and part by consumers through higher prices.

Other than a general agreement that the corporate income tax has ramifications throughout the economy, economists have made little progress in measuring its incidence with any precision. Even if the basic problem were solved, such an exercise would need to allow for all the special provisions in the corporate tax code in order to measure the effects of the corporate tax in combination with all other taxes, and to assess the effects of international capital movements. Finally, any econometric approach seeking to measure the shifting of the corporate tax burden as a result of tax changes must first isolate the tax effects from the myriad nontax factors affecting business.

source

[John123]

Few, if any, states will retain their income taxes. There are a number of reasons, not the least of which is that every state income tax in existence today uses the federal system as its foundation. Without a federal income tax, any state would have to build its own income tax system from the ground up if it wanted to continue to tax income. That would politically and practically a very difficult undertaking.

I am not sure what you mean. I used to live in California, they had their own income state tax forms and tables. Unless you mean the tables are based on the Federal tables?

If so, do you believe that the states would follow the Federal lead and use the sales tax to collect revenues?

[John123]

but sole proprietorships and most small businesses wouldn't

Actually, after thinking about it, I do think all forms of businesses need accounting. Not only you need to keep track of profit/losses, you probably need to track sales and inventory for quality purposes. Also, you should have some sort of annual track record in case you want to sell your business.

[rolling_stone]

http://www.zwire.com/site/news.cfm?newsid=12429114&BRD=1711&PAG=740&dept_id=226967&rfi=6


....Jul. 21--WASHINGTON--Congress is on the verge of turning a small tax bill, designed to undo a single corporate subsidy, into a sprawling package of special tax breaks that is leaving reformers and tax fairness advocates appalled.


The House and Senate have approved differing versions of the legislation, but both share a long list of special-interest tax provisions pushed by Washington's powerful corporate lobbyists.

There are tax breaks for, among others, bow-and-arrow makers, Oldsmobile dealers, NASCAR racetrack owners and producers of fishing-tackle boxes and sonar fish-finders--not to mention a $12 billion buyout for tobacco farmers.

Land developers, ranchers, small-airplane manufacturers, commodity traders and distillers also would benefit from various tax provisions, as would makers of ceiling fans.

"This is probably the most outrageous tax legislation I have ever seen," said Barry Bosworth, a veteran economist at the Brookings Institution and a Carter administration official. "Nobody wants to say 'No', because both parties want donations." ......


This is my biggest problem with our current income tax, it is not fair, special interest groups run it and pay off Congress for their special interests. Who in their right mind can say it is fair and equitable? It is used for social engineering and payoffs. I believe 50% of lobbyist lobby for tax breaks.....lets eliminate that and give the power back to the people where it belongs...

[EternalVigilance]

The central problem with the corporate income tax from an economic point of view is that, ultimately, only people can pay taxes.

Thanks for posting stuff that fully supports the arguments you've been arguing against.

[alnick]

Of course there will be a fight. Noone ever said this would be easy. I get the impression sometimes that the Democrats think we never should have confronted the terrorists because this war on terrorism is rather difficult (to say the least). The insinuation seems to be that if something is difficult, we don't do it.

I like your attitude. I was just thinking that. Alan Colmes is famous for whining that fighting the WOT is too haaard, as if that's some kind of argument against taking on the challenge.

Defeatist attitudes never accomplished anything worthwhile. Whatever the outcome is, I want to see Republican politicians fighting to make substantial tax reform happen.

[alnick]

When it happens, I'll believe it. Until then, it's just so much speculation and hot air. But I'll cross my fingers for some sanity from Washington.

Please do more than cross your fingers. Contact your congress critters and demand they support this. Visit http:fairtax.org

[WhiteGuy]

To steal a line from a friend.............

"My vote is for sale."

I want to hear bush make this promise, live, prime time.

I think it's at least as important as his promises to foxx.

[Your Nightmare]

Thanks for posting stuff that fully supports the arguments you've been arguing against.

I understand that only people pay taxes. I've never said any different. I've said we don't know if all of corporate taxes is borne in prices.

The question is (and you would know this if you read and understood what I posted) which people pay the tax and how much do they pay. Is it in increased prices, reduced wages, or reduce return for the capital holders? You seem to think businesses control prices and can raise them as they wish to cover any tax burden. They don't set the price, the market does.


A separate question, do you believe government can pay a tax?