First of all, the FairTax is not regressive at all, since everyone is refunded
for spending up to the poverty level under the FairTax. As for those that think
the rich somehow don't spend what they earn, well, what planet are you on? Not
only that, but even if an affluent person only spent 20% of their income this
year, who is to say that they wouldn't spend 500% of their income the next
purchasing a house, for example. Everything but used items (no double taxation
of sales) would be taxed, so anything a rich person buys would be taxed, as long
as it's new. Last I checked, those with money typically buy new, those without
don't, and would not be taxed on such items. All earnings are eventually spent,
and if it is kept in capital investment for a long duration, then so be it. Our
country needs all the investment it can have. Not only that, but under the
FairTax a good share of the $11 Trillion (yes Trillion with a T)in assets in
off-shore holdings with better tax treatment, would come back to the US and
significantly bolster our economy both now and in years ahead.
If we are going to have a national sales tax, then we need to add to it an
annual rebate where every citizen gets back about $5000 or so per year so that
the sales tax isn't regressive.This has all the advantages of the
"fair tax" minus the regressiveness of the "fair tax".This truely
would be a fair tax.
Just for fun let's see what the "Fair" tax does to the price of gas. Let's
assume a current price of $4.184/gallon (including the 18.4 cents/gallon Federal
gas tax.) The Federal gas tax goes away with implementation of the "Fair" tax
so now we're at $4.00/gallon. Times that by the 30% "Fair" tax rate (yes, it IS
30% calculated on top of the retail price of goods) and you add $1.20/gallon in
"Fair" tax. Total purchase price for gas? $5.20/gallon . . . that sounds great
to me!Plus, keep in mind, every time the "price" goes up another
dollar, it's really going to go up $1.30.
The fair tax is a consumption tax not an income tax. One of it's main objectives
is to eliminate the IRS (enforcement). Taxes are collected at the at the point
of sale and forwarded to government. It's not a 30% tax it's a 23% tax. There
are provisions for poor, and the last time I checked basic needs like food and
clothing were tax exempt. Even if it's superiority were limited to
just eliminating the IRS and freeing us from involuntary servitude, that would
be enough for me. But for the first time Americans get to keep 100 % of their
income allowing for more leveraged investment and better financial planning. In
other words Americans can start saving and investing their money before the IRS
plunders it. The 23% is based on what this monstrosity of a
government needs today. It should be 10 percent and government should be forced
to live within it's means. As was mentioned in an earlier post it will take new
blood in Washington to get it through because of the tax lobby who need a
complex miserable tax system so their industry can thrive. The fair tax idea has
around since the 80's.
Aside from all the arguments that say the "Fair tax" is not a fair tax, consider
a couple of other things.First, every retail entity becomes a tax
collecter. My barber, my doctor, the bus company etc. etc. etc. If the IRS is
a big organization think about how big an organization might have to be to track
and audit all the tax collecter under the fair tax.Second, If a
check is mailed to every household every month, just how big will the data base
have to be and how much month to month maintenance will have to be done.Think about jumping out of the frying pan into the fire.The
income tax, if we could take out all the provisions for tax criminals and tax
cheats would be the most fair way to support our government in a Capitalist
economy.How about we make taxes totally voluntary. That way people
who support the government would pay all the taxes and people who do not support
the government would not pay anything. Under this system the government might
try harder to be a government dedicated to the people.
The fair tax proposal is revenue neutral, if you think a 23% tax is high, guess
what, you are already paying that much. All of the statements against this
proposal come from an ignorance of the facts.
@Fair Tax is not Fair: You need to study the issue a little more. There are
probates for the lower income levels that essentially exclude them from paying
taxes. Most people are not aware of this part of the FairTax.
The tax system will never change until you find something equally profitable for
the accounting/tax attorney/tax prep folks to to do with their time. You're
talking about putting a whole employment sector out of business, and they won't
like it one bit.
Does the writer of this letter really think a regressive 30% sales tax is what
the country needs. If you add the 7% state and local sales taxes you will be
paying 37% fon some purchases. Can you imagine the enforcement apparatus that
will have to be set up to make this goofy project work?
A fair tax would indeed be good medicine. However taxing the CEO who makes 10's
of millions 20% of his pay, while you charge the young single mother of 2 20% of
her pay 20% is not a fair tax.Remember there are multiple ways to
have a flat tax.1. Charge each citizen the same number of
dollars.2. Charge each citizen the same percentage of income.3. Give each citizen the same financial burden. $500 from a young
single mother earning near minimum wage is a huge burden. 50% of pay of a
person earning millions every year will hardly be noticed.