Posted on 10/15/2011 10:09:54 AM PDT by rob777
There has been a lot of talk regarding where Cain got his 9% number for the income tax, sales tax and corporate tax. Apparently a full analysis was done by economist and former assistant to the director of the Office of Tax Analysis for the U.S. Treasury Gary Robbins. Robbins thinks that the plan would work economically, but would not sell politically:
“You’re trying to go to a system that taxes income once and only once and quits double-taxing savings,” Gary Robbins told POLITICO on Wednesday. “That’s something that can really juice the economy, it’s probably worth 15 percent in growth. … The problem with the big-bang changes like that, the flat tax or the fair tax, is that they are so alien to the current system that it would be a great big shock.”
Though Robbins says the plan would work fiscally and economically, he believes people would never accept such drastic changes. http://caucuses.desmoinesregister.com/2011/10/12/herman-cains-9-9-9-analyst-its-a-theory-not-a-solution/
The actual number that would allow the plan to be revenue neutral is 9.1% (See table 10c on page 8: http://www.politico.com/static/PPM191_111012_999scoringtables.html
I like the openness of the plan. Instead of “out of sight, out of mind” like we have now, any tax increases are actually seen by the taxpayers.
The question is, what else would you be doing with that money had you not deposited it in the bank?
How much would it be worth to you to forego what you wanted to do with it, and instead let the bank loan it to someone else for a period of time? The interest that the bank pays to you is the price you are willing to charge the bank for their use of your money. It should be at least equal to, if not more than, what you would otherwise have earned with that money.
-PJ
Just remember this about the 999. Herman recognizes jumping from what we have now to the full blown FairTax will be a nightmare and also would create a lag in basic operating funds for the government (little things like paychecks for our military) while the IRS and other agencies are re-tasked to run efficiently (imagine that).
The 99 would provide that basic funding while the last 9 would begin the process of the re-tasking by giving those businesses able to switch rails immediately (mostly the smaller ones) and provide for finding any details that would have to be tweaked to make the system run smoothly for the full blown FairTax. Once there, the first two 9’s would be eliminated.
Herman knows this because he has been a student of the FairTax for a long time because of his close association with both Rep. Linder who originally authored the bill and Neal Boortz who headlined as author of the books.
Not to be overly snide and snarky, but are you related to Rep. Conyers and refuse to read?
READ THE BOOKS!
The danger is not what it can turn into, the danger is what they do already.
There is absolutely no restraint on congress to raise taxes currently, in fact the speaker of the house said on the Greta show, that there is an average of 5,000 changes to the tax code every year.
Spending is the disease, they think the taxpayer will accept half a loaf, so far they seem to be right. Roosevelt was elected three times by playing the class warfare card. We shall soon see, what we have become.
“Or maybe the 9.99 pizza will be $7.00 because of all the hidden taxes already built in?”
Bingo!
Some folks just don’t get it. All the taxes paid by corporations are built into the final cost of consumer goods sold by retailers.
The elimination of the payroll tax + the reduction of the corporate tax to 9% + the creation of a 9% sales tax = tax reduction. This should be very obvious.
“even if in the long run it lowers taxes”
No. It lowers taxes at the moment it’s implemented. With the implementation of 999 the federal government will collect $800 billion less than it does today.
Aren't we talking about the consumption portion of the plan? We're talking about the 9% national sales tax that the already-taxed savings would be used for.
However, we already have state and local sales taxes in the range from 6%-9% in most places, right? If so, then the conversion of existing sales taxes to the national consumption tax would mostly cancel out, right?
-PJ
You can define "endorsement" as in part with changes expected, or the concept of a credible plan overall which will change the tax structure of the country--BIG TIME where the time [make use of a good crisis, the Left claims] has come to be a team player and run over your opponents. Now, of course egos of other candidates come into play--but where is their plan, the ones that are so quick to "say it won't work"? They do not have a plan, any credible plan supported by real economic thinkers as Reaganomics Laffer has called "wonderful" who has also had critics of his own--it's politics as usual.
No more win on personalities and coiffed hair-dos, and not substance or experience--plan first, win second-the way it should be.
I once was eager over Gov. Perry, but perhaps he is more at his comfort level in his homestate where he has seen great success. I like Bachman as I can "see her" as presidential material, very intelligent, tax attorney-carries herself with great dignity and poise. I thought Palin seemed always tackling family drama issues, as a mother-bear should and finally decided what was best for her family, first. I admired that. Mitt has great leadership skills and thinks like a business man even using powerpoint presentations at first, in control even under pressure when in meetings where he allows blowhards to do their talk, then takes charge. The rest don't enter my radar screen as not real leaders of the most powerful nation in the world that I would feel comfortable with.
... or do they all become a blur after a certain point?
Thanks
LOL I think it’s more of a problem with Cain looking better the Perry.
I’d like to see your source for that allegation.
Mr. Cain needs a more educated voter, but sadly he is out of luck on that one. Bill Clinton taxed the dead and then taxed SSN as well, was that too complicated.
How about giving half your estate to the government when you die? A simple move that would eventually destroy the farmers of America, but do nothing to control the Giant endowment funds that finance the movers and shakers of the world.
Capital gains, you know that stuff that creates retirements funds are double taxed already. Spending is the enemy, not taxes.
I have no issue with removing those taxes.
Gee, ya think?
Correct. And no matter what the cost might be, mylife, how about staying home and making your own meal once a week to cover the “increase” you mentioned. The market will adjust the price, and to your benefit if you do not buy it.
Ryan said he “loves” the “999 Plan,” and that it would be a great starting point for reforming the U.S. Tax System in 2013:
So let’s see . . .
We get to pay 9% federal sales tax in addition to a state sales tax.
Add in state sales taxes, and some us would then be paying close to 20% in sales taxes when we buy something.
The result will be consumers will reduce spending.
A further collapse of our consumer economy will follow.
Meanwhile, because consumers reduced purchases, the 9% sales tax won’t generate the expected revenue.
So then the government raises the 9% sales tax to say, 12%.
People reduce spending even more.
Government then raises sales tax from 12% to 15%.
People reduce spending further still.
Meanwhile, states will also find their revenue from state sales taxes falling, so they will have to raise sales taxes or income taxes or whatever to try to make up for the drop in sales tax revenue.
At some point, the federal government realizes raising sales tax is counter productive, to it raises income tax from 9% to 12% or 15%.
But because the economy is in the dumpster because the consumer has reduced spending, incomes are off, so even the increased income tax fails to generate enough revenue.
Then, instead of raising the tax rates, the government might take the view view that putting your money into a bank savings account amounts to “buying a bank account,” snd proceed to charge 9% “sales” tax on the money you put into savings . . .
To make people more likely to spend money to boost sales tax revenue and the economy by making it equally expensive to save as to spend.
And anyway, if a poor mother pays federal and state sales taxes to buy her children shoes . . .
The billionaires should slao be made to pay the same rate when they buy stocks and commodities with the cash they have left over after buying their kids shoes.
But in any case, I’m not worried, because this 999 plan will never happen, and is just a gimmick to generate controversy and votes.
Actually they are taxing twice. Once when earned and once when spent. Makes me not want to spend.
The premise behind your argument is that the National Sales Tax is a simple add-on tax the way state sales taxes are. It is not an ad-on tax, but a replacement for taxes that are already embedded in the selling prices. As such, it does not constitute an automatic increases in retail prices. In fact, there could conceivably be a decline in prices if the 9% tax is indeed less than the embedded taxes it replaces.
Your posting history is readily available to anyone who looks at it. Pretending to be an objective observer when you are in fact a fervent campaign bot is dishonest.
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