Posted on 01/31/2008 4:03:19 AM PST by Man50D
More importantly, without a valid SSAN, no pre-bate. We all know that the Social Security number is defacto national ID: no valid Social could be the key to self-deportation. . .
“The moment we knowingly tax illegal aliens, is the moment we grant them amnesty.”
Illegals pay taxes in this country every day: State sales taxes, Federal tax on gas, & on & on & on. Sorry, but taxes have NOTHING to do with the legal status of an alien.
FairTax bump!
Your ignorance of the Fair Tax is glaring. The FT is no more a VAT than my dog is a feline. Better do some reading on the FT vs. a VAT.
1. The prebate system will allow the pols to manipulate & divide the people as the current income tax system does. Controlling what you owe vs. what you get back is the same thing.
2. The prebate system will allow the gov’t to continue to monitor your income, & probably your wealth as well. The wealth monitoring is a NEW intrusion into our shrinking privacy. A monthly check sent to you will also allow the gov’t to monitor your place of residence.
3. The prebate system will require as many or more bureaucrats to decide how much to send to EVERY SSN in this country EVERY MONTH! This has FUBAR written all over it. Nobody is gonna complain if they get a check 10x too big, while welfare queens will have kids like puppies, to get more money, just as they do now with welfare.
A fairer & far easier administered system would be tax exemptions on items like food, medicine, health care (do you really want to be taxed on this?), etc. Many states already have these exemptions on their sales tax, so this would be easy to implement at the retail level. Yes, the pols will argue over what is exempted, but that exemption will apply to ALL Americans without bias or favoritism.
The Federal Gov’t has NO business involving itself in the personal & private lives of EVERY citizen in this country. This is tyranny, & never intended by our founding fathers. We need less gov’t intrusion into our lives, not more. The prebate will give us more by monitoring wealth as well as income. Like sheep to the slaughter, we will all eagerly have our newborns fingerprinted, a DNA sample taken, maybe a retinal scan; just so the kid gets his/her SSN & that prebate check is in next month's mail.
Why do you think the prebate monitors wealth or income? The exact same amount of money gets sent to every household, whether you’re Joe Poor or Bill Gates. The only variable is family size.
The bureaucrats who determine the size of the prebate already exist. The government calculates poverty statistics every month, so it’s information we already have.
And I doubt a lot of physical checks would get sent out. I’ve always heard it described as a direct deposit system, or prepaid credit cards for people who don’t have bank accounts.
But, I still contend that the prebate will be the political football. Poor people will always support the pols that want to increase the prebate, whether the gov’t has the money or not. As the amount increases, more & more people become ever more dependent on that monthly check. You will NEVER be able to lower the prebate without seriously angering the ENTIRE population. No pol will ever allow that to happen. The gov’t statistics used to justify the prebate will simply be manipulated to generate the “desired” result.
I also read the weak arguments against sales tax exemptions. The army of lobbyists and special interest groups mentioned are lobbying to lower MY purchase cost, & that is a GOOD thing! The pols are between a rock & a hard place. To grant a new exemption, they have to take it out of their OWN bureaucratic pocket - less taxes mean less to spend or a bigger deficit. Pols don’t like to cut taxes, especially liberal ones.
And the nonsense about the rich gaining more benefit from exemptions is a laugh. The rich eat filet mignon, the poor eat 80% lean “hamburger”. The rich buy a new car every year, the poor buy used cars (no tax) every 10 years. The rich fly first class, the poor take the bus. The rich shop at the “Gucci” stores, the poor at Walmart. The rich get hair transplants & a face lift, while the poor get a baseball cap.
As for the number of paper checks - that is the least of it. Getting the amount right, & to the right person is the problem. Thousands of people are born & die, marry, divorce, change residence, & reach age 18 every month. We are gonna have to notify the gov’t EVERY time something occurs in the family that might affect the prebate. That is probably a bazillion changes a year. Tracking these changes & sending the right amount to the right people will make the current IRS processing of YEARLY refund checks seem like perfection. And the people that will suffer the most are the poor who desperately need that missed check.
Why does the FT contain such a bureaucratic pig as the prebate, when sales tax exemptions are far easier to administer, & common sense tells everyone they are fair because they apply to everyone equally?
The prebate is “of the bureaucrats, by the bureaucrats, & for the bureaucrats”.
Granting amnesty would be signing a bill granting amnesty.
It would be saying “So you want to stay here illegally? Now you’re paying taxes. Don’t like it? Screw you, pay me.”
That’s all it is.
I did not say the FT was consumption tax, I said it was not a VAT.
Do you think those lobbyists are going to go away with a wave of the wand? As long as the government has a trillion dollar budget, those lobbyists will be around to get their share. They'll argue that it's good public policy not to tax this or that product, they'll argue where the proceeds should go. Soon enough, the fair tax will be as byzantine as the current income tax. But, most folks won't notice as they aren't bothered by a tax subtotal on the receipt nor any April 15 paperwork.
A hidden tax is never a good idea. If enacted, the tax should be a separate line on every receipt, correctly noted as 30% add-on to the price of the product or service.
One of the biggest problems I have is with the moral problem in removing tie between paying into Social Security and getting from Social Security. The Fair Tax would ease the way to scamming the Baby Boomers out of every cent they put in over the years.
A history of working used to guarantee you SocSec benefits at retirement. Now, it is likely to be used to deny or reduce the retirement benefits.
Oh, & please enlighten us all with your research that leads you to believe the Fair Tax is a VAT. I’d be most interested in your sources.
The VAT tax is a tax embedded in the retail price, exactly the same as the Fair Tax. Similarly, it also doesn't apply to used goods. The structure of the VAT tax is there to prevent some of the common methods of avoiding a tax imposed only at the retail level.
Regardless of how you parse it, both the VAT and Fair Tax can be calculated as a %of the final retail price.
The VAT just takes a proportional bite at each level of production.
Example:
Propane deal sells 1,000 gallons of propane to a farmer. The propane is used to:
heat the house - retail consumption
heat the barn - component expense to the final product or wholesale consumptions
drive the tractor - wholesale expense
drive the family pickup - both retail and wholesale
If the propane vendor taxes the propane the tax becomes a VAT. If he does not, it is a consumption tax that never gets collected. There are easily a dozen or more examples of how something that sounds simple, is not understood until you think through the problems.
Also ...
Under the Linder-Chambliss bill, the federal government would have to pay taxes to itself on all of its purchases of goods and services. Thus if the Defense Department buys a tank that now costs $1 million, the manufacturer would have to add the FairTax.... The tank would then cost the federal government $300,000 more than it does today, but its tax collection will also be $300,000 higher.
Likewise, Similarly, state and local governments would have to pay the FairTax on most of their purchases. This means that it is partly financed by higher state and local taxes.
That means when you purchase services, you will pay for the basic cost of the service, from the city, plus the Fair tax on that service. Included in that basic cost is the tax cost that the city had to pay. So you are paying taxes on taxes ... the classic definition of a VAT.
Businesses such as farmers have been parsing their expenditures for income tax purposes for years. In your propane example, fuels used to heat the house or power the family car are not business expenses, while the farm related gas usage is fully deductible as a business expense from income before taxes are calculated. The IMPOSSIBLE you mention has been done by anyone who drives a company car. It is a pain in the butt, but is done every day.
I don’t believe any sensible proponent of the Fair Tax will tell you it is PERFECT, or without flaws. If you read my other posts here today, you will see I have a MAJOR problem with the PREBATE. But, I do believe the FT (substituting tax exemptions on food, meds, etc. for the prebate) is a smarter, fairer, & less corruptible method of financing the Federal Gov’t.
Is it now?
The trends depicted in the grapics below are the result of nothing more that governments, either purposefully or innocently, voting themselves small advantages over the private sector over time. Once that has occurred markets, over time, do the rest for them.
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“It will be the people who prevent the prebate amounts from increasing.”
Huh? People wanting less free money from the gov’t? Since when? Amish? Besides, the people have ZERO control over the prebate calculation.
from fairtax.org FAQ:
“The size of the prebate is determined by the Department of Health & Human Services’ poverty level guideline multiplied by the tax rate.”
If the tax rate is increased, the prebate automatically increases, but a prebate increase does NOT trigger a tax rate increase. That must be passed by Congress.
Thanks for posting this article today. It made me review the FT web site & I learned some things today.
Since the FT is not yet law, is can easily be corrected to exempt business-to-gov’t sales from the FT. Again, this is absurd.
Our huge deficit convinces me that spending is only casually related to tax revenues, & the FT is touted as revenue-neutral vs. our current tax revenues. Fed. spending plays no part in this debate.
I have no doubt our current & future crops of congress critters will feather their own beds at every opportunity, no matter what system of Gov’t financing we have; so that is not relevant unless you can show particular areas where the FT is more liable for abuse than the current system. Except for the prebate, I don’t see them.
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