lol, this is the first year I've ever got money back since I've been married (10 years) and it's alot. What's the problem?
The problem is that is not going to be the case if you make over 30k in the near future...with all the spending it will get worse and worse...but I digress. Fairtax FTMFW!!
Well with the "horribly broken regressive tax system" I would know how much something would cost when I bought it, and not cost me $3000.00 in penalties with a Capital Gains Tax when I sell it. To make matters worse I was born on this God forsaken day so I have even more of a right to be pissed. And with another observation, everybody at the Tea party that I talked to had a job or seeking one after being laid off. And those that were laid off were kind of humbled and embarrassed to take advantage of certain benefits.
It's not the color of his skin, nor the question of citizenship. It's the principles and the beliefs that he stands for that unsettles most. Come on, be serious, he picked Joe Biden as his vice-peon. That alone ruined it for me. Or was it the unicorn? It was the unicorn wasn't it?
I'm not arguing the complexity of either system. stop being so dense. also: LOL @ the tea party. it is not a grassroots movement by any means. if you believe not paying your taxes, that's fine. feel free not to use any public services. if you want to have an honest discussion, feel free. but don't resort to petty things like "vice-peon." you lose all credibility this way
Just blaming the whole thing on him. My family got its largest ever rebate this year, and I got a pretty nice one myself. Come on, be serious, McCain picked Sarah Palin for his Veep. :sx:
yep, the same 'too high.' I have to work until later April to pay what they say my tax liability is. it couldn't be any worse than the passing of bills that none of the legislators have bothered to read. At least more people have read HR25....
That and it would bring 11 trillion or so dollars back into the united states, create tons of jobs, make investing and saving for retirement tax free and lower the average american's tax burden significantly. Oh...and the whole getting your whole pay check thing is not so bad either rather than having 20-30% of it taken out every week.
the lower and middle class would pay a higher tax rate through some accounting tricks; it isn't very transparent. look it up. that's why it is a cleverly designed REGRESSIVE tax system. I'm not arguing for or against it, just pointing out it is regressive. and I agree that wage withholding is the biggest scam the government ever pulled.
you realize, the taxes you are paying/receiving was under the Bush admin, right? next year, let's see if i own or get back. i'm penalized for being married to a woman who's making more cash then me, we don't have kids and my house is paid for. all i do every year is bend over. because, you see, people are given the right to take from me and give to those who aren't as "less fortunate". it's my fault for working 50+ hours a week trying harder every day to make a bigger impact in advertising.... it's my fault for not being a slacker... oh, and then i'm taxed because my chili won the stone mountain cook-off this year. joy, lucky me. i'm moving to Vancouver, BC where at least i can smoke every day and forget that i get fucked for earning a better living then the "less fortunate". [END RANT]
and at least it would tax the thousands and thousands of illegals and black market people that are currently mooching...
Actually with the prebate you receive every month the lower class and a good percentage of the middle class would pay NOTHING in taxes...course that does not change much from the current system for the lower class...but it does for the middle class. Look it up
I hate seeing the drug dealers living in government housing driving a BMW or Mercedes nicer than my car, lol. And yes, when I was a cop I saw this ALL the time as I was in the ghettos a lot.
not many people find taxes funny anymore considering what many believe its ineffective use. the biggest joke here, though, is that the same people finding it not funny are expecting the ones who made it this way to fix it. IE legislators/pres. What they refuse to see is that they won't ever "fix it." It would reduce their relevance and their power if they "fixed it" like the people want or like it should be. Democrat and now Republicans are both guilty of this behavior. A politicians first job is to keep his job, not do his job. ....and don't mind Nicad, his definition of 'fair' still equates to "you should pay more taxes because you can afford it." ;p ;p ;p Even if the total tax burden is MUCH less in monetary value, just because it may seem like a higher rate due to some critics 'accounting tricks' that makes it still not fair in his opinion.
you have no clue concerning my ideas about the government, so please stop acting like you do. I haven't taken sides in this issue and never expressed my opinion for either taxation scheme, just trying to point out inaccuracies. I weep for our country when people believe things spoon fed to them by radio personalities without doing any critical thinking on their part. I have one thing to say to all of you: if you honestly believe all this bickering about liberals, conservative is constructive in the least... you are delusional. politicians are two sides to the same coin. they are in the business of self preservation, and this petty and pedantic bickering about STUPID ISSUES is the biggest trick they have ever pulled on us. nothing will ever get changed for the better when everyone is too wrapped up in nonsensical political doublespeak. your constituents will never vote you out of office and bring about any real change when they are too busy fighting amongst themselves. the american voting populace is too fucking stupid, and they always vote against their own best interests. this is the politicians greatest tool: having the average voter not understand the issues and vote against his own self interest. flame away, but look past your own ideologies at the big picture for once
No I agree completely that the average person doesn't even know what they are voting for. Look at this past election. They go out and do interviews and ask Obama voters some questions. One was, How do you think Sara Paylin is doing as Obama's vice presidential candidate? The voters were all like, Oh yeah she will do a great job with Obama. These people never even knew who or what they were voting for. I like the phrase American Idol generation. It was flashy, it was hype and they bought every last bit of it. While I generally consider myself conservative, I think both of the current parties are pretty broken. They just tack on more and more taxes...republicans and democrats alike....and really don't care who pays the bill. It is time for some tax reform. Of the solutions out there I feel that the fair tax is the best one for the job. Then each individual can decide exactly how much they want to pay based on their spending habits. New business WILL come back to the US as it will be a tax haven for business. New jobs will come with it. The poor will not pay taxes. Illegals and black market will pay taxes. It captures a lot of money that is currently never being taxed and in return I think lessens the burden on everyone. People will have more money to spend, will be able to save for retirement tax free and will be in a better position in life.
Income taxes make up approximately 1.2 trillion of the US budget. The corporate tax makes up just under 400 billion. Now if you suggest ditching these then please tell me how in the hell you will make 1.6 trillion via sales tax. The result is massively increased prices to make up that difference. That not only will inflate the US dollar like crazy sending us more into economic troubles, but also I am agreeing with nicad in that it's regressive. The poor will then struggle to afford basic items, unless you intend on giving them stipends...which you have to make up from in taxes, so that adds costs yet again. Sorry, but progressive taxes are fair systems. The more you make, the more you can contribute to your country up to a point. Thats in the form of protection and other basics a government provides you with. Sure you may not like it, who does. However taxes are a necessity.
And if you think about it....the more you make generally the more you spend...so in effect the more you are paying in tax. The poor will pay NO TAX. They (and everyone) get a monthly "prebate" at the beginning of every month. A check for all the taxes they would have to pay for food, basic necessities, etc. They pay NOTHING. Where this really pulls in some money is all the illegals that currently pay nothing on average, the drug dealers, theives, etc who currently pay nothing. By bringing 11 trillion in new business to the united states I fail to see how this is going to hurt our economy. And there is no real increase in the cost of goods. All the embedded tax (read if a corporation gets the shit taxed out of it, who do you think they pass it on to in order to continue to make a profit...thats right boys and girls the consumer!!!) that is currently in the products goes away. It is replaced by the fair tax and remains on average pretty close to the current price, but you have your WHOLE PAYCHECK to buy it with. I fail to see how that is detrimental...more money....same prices.
Sorry, I did it for sum lulz, but I guess yur lulz radar is borked. Which begs the question, why not? Have you yet to make up your mind on such things? Are you unwilling to expose your POV to others scrutiny for some reason? Does sharing your thoughts somehow detract from anything else you've listed? I note that you expressed a serious reaction to my playful projection of you, but you didn't offer anything substantive as an alternative, an explanation, or a refute. Hm, so you're basically comfortable making passive aggressive assertions about me that you were quite cross when I made them in jest directly on you. Lets say this indirect supposition is your view about me. What do you have to substantiate such a view? All you know is that I support the Fairtax, and that I think I pay too much in taxes. Thats all you need to dismiss me as a regurgitator of an entertainer? As though it was impossible for me to come to such conclusions as an individual? Even in joke, I gave a pretty specific criticism to the content of your remarks. It begs why you were unable to offer similar substance. Your saying this makes me wonder if you actually read my post or if it even registered to you... You posit that those participating are the problem, but the non-participants FAR outnumber the active folks (and my simple definition of active is 'voting.') I posit that they are the problem through their unwillingness to participate, yet still complain about how the machine works. They perceived themselves as above what they view is such pedantic participation, either for reasons of superiority or deference, and instead consume mass-media in large amounts rather than civil affairs. All of these people, however, do have one thing in common; they ARE looking out for their own ideologies first, be it democrat, republican, other, or unresponsive abstainer. I will happily state that the Fairtax represents a big self-interest to me, and coincides with my ideology. But is that the end of it? To you it seems to be. In addition to viewing it with disdain as a position of the ignorant, you take the view that my ideological self interest is inherently a problem, myopic, and selfish. But for all you know, I may be supporting the Fairtax for an entirely altruistic ideology I feel it would satisfy. I may support it as a form of social justice in my ideals. You have no clue about the content of my character that motivates my ideals, and how it is represented in the political causes I support, so please stop acting like you do. :wavey:
Not really. From what I remember hearing we would all get this 'prebate' check from the government. How does that help things? It's just the government moving money around, and that type of spending gets the economy no where. Spending money that you are going to take back up creates a viscous cycle of problems. And that's just for basic items. What if they want to buy a house? That 100k is now 130k...yeah. Rent would increase, as would any other item. 11 trillion? Please stop making up numbers, thats just a few trillion less than our current GPD. We won't see 11 trillion more than right now for several more years. I would see goods becoming even more expensive besides the 30% tax you'd be paying on goods. Why? Because every good is now taxed at 30%, the companies have to pay that too. Where does that go? Well you said it yourself. No way do I want to pay 30% on top of everything I buy, weither thats over the internet or going down to the store. I don't get taxed 30% on my income, and most here probably don't either. You have to make some rather respectable money to get into that bracket.
The FairTax, like many other tax plans has quite a few advantages and disadvantages. Here are some of the negatives: 1. It's regressive. The more money a person makes, the less they spend proportionately. Think about it, when you're in college, and making $400 a week, you're spending all of that money on consumption. When you're out, you're spending more than $400 per week, but you're making more. This equates to a discrepancy in the proportion of taxes paid in consumption. The "poorer" spend much more as a percentage of their income than the rich. That's regressive. 2. While the FairTax does do an excellent job of capturing taxes from illegal immigrants, it does so at the expense of industries that rely on foreign dollars. How many tourist dollars come into Las Vegas, Orlando, NYC, and elsewhere across the United States will leave now that the prices of US goods in the United States are X% higher? How would this affect the influx of productive, smart students from foreign countries? 3. The FairTax, upon implementation immediately decreases the purchasing power of funds already set aside in savings. (Post-tax) dollars set aside into savings accounts, retirement accounts, etc. will undergo a second taxation upon consumption. So, that $XXX money you have in the bank would really equate to $XX. 4. While the argument for an inclusive or exclusive tax doesn't change the effective rate, an exclusive tax is more visible to the consumer and much more easily understood how a change in the necessary tax rate would affect the price of a good. If a $100 is taxed exclusively at 10%, it's price would be $110. It's easy to see how a 1% increase in the tax rate would affect the bottom line. It's not quite as easy to determine how a 1% change in the tax rate would affect prices with an inclusive tax rate. Furthermore, inclusive taxes make it harder for the consumer to comprehend the actual cost/value of the good. For example, how much does a gallon of gas cost without tax (it's an inclusively taxed good)? 5. The transition to a FairTax plan would require significant financial investment to support the treatment of existing inventory, validation of "non-final usage", etc. Under the FairTax, consumers don't pay the tax unless it is end-use. This would require some investment in the form of either time or capital to be able to differentiate an end-user from a non-end-user. 6 etc. There are many other roadblocks that make the FairTax a little less appealing including auditing (after all, there's no IRS), sourcing of funds to make the first prebate payment, presumed increase in the ability of tax fraud, etc. There are several elements of the FairTax that I support: 1. People/businesses should not have to pay to pay taxes. I don't like the fact that a business must undertake expenses to be able to properly ensure payment to the government. 2. It does capture revenue from illegal aliens 3. etc.
You really have not done a good job reading up on this have you? I understand that what you are saying is what a lot of members of congress and the senate say...primarily the democratic leaders. But you have to look at their motives and do a little research on your own. The prebate may be shuffling money around, but it still has the same end result of people not paying ANY TAX for the basic necessities. So in effect the poor would pay NO tax. It is not 30% on top of the current costs. It's not even close. It does away with the embedded taxes which are currently estimated at around 23% plus the tax already in place on purchases. The end result is around the same cost for goods with more money to spend on them. The 11 trillion is not a number I have made up. That is the estimated business that would RETURN from foreign countries if this were to be implemented. The reason why they left in the first place? Our current tax structure. Given it is not going to be an immediate shift, but making the US the world's premier place to headquarter companies and corporations due to the tax structure would go a long way to bringing a lot more prosperity to the US and jump starting our economy out of our current rut. The net effect is that this would also give people a way out. They would have more to spend, tax free ability to save and invest in retirement, and bring in more business to increase jobs. Yes the current taxes and savings would in effect be taxed upon the purchase of goods, but when you take into account the current system, with built in taxes and the CURRENT sales tax, it would be anyways!! At lease with the fairtax you could make money without being penalized for investing or attempting to save for retirement. It just makes sense. Another benefit is it gives the AMERICAN worker the advantage. While illegal aliens currently work for lesser wages because they do not have to pay taxes, under this system they would actually be at a disadvantage to legal us workers as they would not get the prebate but they WOULD be paying taxes. This gives the legal American worker the upper hand for the first time in a long time. The playing field would be tipped back the other way towards Americans instead of them having to compete for jobs against illegals that do not have to charge as much! There are a million reasons people can make excuses...saying it would be difficult at first, saying it would present problems, but I say that none of these are more of an issue than our current broken taxation system continues to give us on a daily basis.
The idea is to increase the tax base. This means making more intake points where taxes are collected. Thus, if you consider that income taxes are collected from a few hundred million employed citizens, it makes perfect sense that a tax on ALL retail sales transactions, every last pack of gum, every new car, and every DVD, (trillions of individual products versus a few million people,) can indeed be 'revenue neutral'. I see you're missing a key component here. Let me go over it a bit in detail. To understand and see the value of the Fair Tax is to look at so called "corporate income tax" as an empty name. No corporation pays income taxes from its profits, it passes the cost of taxes on down the line to the consumer. Therefore, corporate income tax is paid by individuals anyways. So when you say up there that "corporate tax makes up just under 400 billion," all that I see is "400 billion is hidden embedded costs that people mistakenly think corporations are paying when the truth is we consumers end up paying it just the same." The mathematics involved in calculating the amount of embedded taxes say between 22% and 29% (depending on the goods) is embedded tax. One of the major cruxes for the Fair Tax is transparency. Instead of hiding these embedded taxes, the Fair Tax lifts it from the corporations' level, but continues to collect it more directly and clearly at the retail level by listing it as an 'exclusive' retail tax. The total cost will be the same after taxes, because the embedded tax disappears and the retail tax replaces it to make sure it generates the same money. If a $3.00 gallon of milk has about $.75 in embedded corporate taxes you don't see, and then the Fairtax is passed, then the Milk will go down to $2.25 and the $.75 sales tax is listed. Total cost is the same. The thinkers behind the Fair Tax knew it would be a meaningless system if it didn't replace the amount funds, or 'revenue neutral.' As far as 'the poor', the Fair Tax basically mimics the current tax code. Almost none of the people classified as 'poor' actually pay any individual income tax now. Is it fair to the people who actually produce more for the economy that they get penalised, and the not as productive get a disproportionate advantage? And the same people can vote for an elected official who will continue to take more from some only to give it to others to capture their votes? If the arguement is that 'the poor' somehow need to not pay taxes compared to everyone else, thats hypocritical. For you to explain how 'progressive' is fair based on what you said here, then you must somehow prove to me that a guy making $70k a year somehow is a bigger burden on the federal government system and resources than a guy making $23k. You can't prove it, because its not true. 'The Poor' by radically higher numbers are far more draining on civil services than more productive taxpayers by proportion. A 'rich guy' doesn't cost any more money for the army to protect, or for the FDA to oversee their food than 'the poor' guy. Your rationale then boils down to 'because they can afford it,' and intellectually, as well as morally, I can't support that thinking. --- With that in mind, the Fair Tax continues to be 'fair' because it gives the exact same breaks to everyone. The government currently sets a 'poverty level' for yearly income to determine who is 'poor.' Under the Fair Tax, instead this figure would be converted be the 'lease you can spend monthly and survive' to determine a poverty level. Whatever that value is, you don't pay sales taxes on that. If the government says that at the very least to get by you have to spend $1500 a month, then you don't pay taxes on that $1500 worth of stuff. The poor don't pay taxes, but then EVERYONE gets this break on the poverty level of spending. That is truly fair. Then, any spending after poverty level is taxed. The rich with more disposable income will consume more, and therefore get taxed more. The poor who can't won't pay any taxes at all in the end.
Again, it's not as "Fair" as you make it out to be. Here's a quick list of people that this is not "fair" to: 1. Low income families and the young: As stated above, those on a lower income spend more in consumption as a percentage of their income than those in higher wage brackets. The result is that these people will effectively pay more in taxes as a proportion of their earnings than those that make (and are able to save) more. Think to when you're in college, making $250 a week. Most of that money went to pizza and beer, and under the Fair Tax, that person would pay taxes on those goods. Compare that to a person that brings home $1000 a week. That person does not likely spend the same proportion of their income on goods and services that would be taxed under this plan. This enables that person to save more money. In short, this enables the rich to get richer while the poor continue to eke it out. The Fair Tax is regressive. 2. Retirees, those on fixed incomes: So, here we have a significant group of people that have worked their entire lives to setup retirement accounts. They've saved X dollars, paid taxes on those dollars with their wages as they contribute to savings accounts (be it IRAs, stock/mutual fund portfolios, etc.). Under the Fair Tax, all of those funds that have been saved would be re-taxed as soon as these people spend the money. This would effectively reduce the value of their retirement accounts. These people would then have to re-enter the work force to make up for the instant 23% increase in prices. Remember, they're not getting that money put back in their paychecks, they're retired.
The Fair Tax eliminates business to business sales taxes. The corporation will have none of those taxes that they have to raise the price of milk to cover.
I was just getting to your other post. The basis for your conclusion is actually untrue. With the Fair Tax, nobody pays taxes on the first chunk of money they have to spend in a month. Right now, the government sets a 'poverty level for income,' under the Fair Tax it would be set as a 'poverty level of spending' instead. In your example; if the poverty level was $1500 a month, and in college you make $1200 a month, you won't pay sales taxes on what you've made at all. Neither will the guy out-of-college making $3000 a month, but only on the first $1500 of 'poverty spending.' After that, the out-of-college guy pays taxes on every dime after $1500 he spends. This makes the Fair Tax progressive, just as much as the withholding income tax you pay now. College guy pays no taxes on what he spends, and ooc guy pays taxes. They (tourists)won't notice a difference because they're paying the corporate income taxes hidden, or embedded, in what they buy right now. Same answer as above. It won't decrease any purchasing power, infact it will increase it. Remember, the Fair Tax addresses a tax you are going to be paying anyways even with your savings now if nothing changed. Thats the embedded taxes from corporate income tax currently in place. You may be asking, how will it increase your power? If you have savings, and you spend it gradually, then the spending of that savings also falls under the same rules as the college guy in the above example. If you have $30,000 in savings now, you'd pay that embedded corporate income tax anyways when you spend your savings, no matter what you did. Under the Fair Tax, you have the potential, if you spend it gradually, to not pay any taxes at all on it. :-] This is true, and this is why only a handful of states actually list the taxes on gasoline exclusively, because the obfuscation of it benefits the government immensely. They can raise it with very little fear of reaction because you don't see it listed there to get upset about, and don't know to ask how they calculate it. However, an inclusive tax is how the Fair Tax is listed because its replacing an inclusive income tax. People do understand their own personal inclusive income tax rate. The easiest comparison is understanding the difference between 'added to taxes' and 'taken away taxes.' The income tax is a 'taken away tax,' and my own tax rate is roughly 36% taken away of my total. This tax is what the Fair Tax is replacing, a 'taken away tax.' Even if most people are familiar with an 'added to tax' when it comes to sales tax, it makes more sense to replace one type of tax method of calculation with the same type. So what makes the Fair Tax better than now, you may ask? Simple: everyone knows exactly what the Fair Tax rate is. Do you know, or does the average tax payer know, right now of the top of your head what your inclusive income "taken away tax" rate is? Or how it is calculated? ;-p If everyone knows exactly what the tax rate is, how its calculated, and who/when it gets changed, its alot harder to make back room political deals with it and nobody noticing, like they do now. actually, it would be incumbent of both the Business (non-end user) and the Wholesaler to sort out. Then, simply, everyone else pays the tax. It will be drastically more simple to manage the exclusion method for a few hundred or thousand businesses in a district. In fact, most retailers and wholesalers already do this with NPOs and Charities that have sales tax exemptions now. Ultimately, it will be far easier for the government to calculate and track a minuscule amount of business exemptions compared to managing the incomes and witholding rates of hundreds of millions of taxpayer records that they do now. In fact, if you read in the Fair Tax bill, theres a neat section to cover the transition on current inventory taxed. It will basically allow a company to declare a percentage of the value of the inventory they had on hand the previous fiscal year before the Fair Tax was enacted. They would apply for that credit gradually as they moved that inventory along. as far as tax fraud, thats also actually harder to do under the Fair Tax. Right now to cheat on your income tax, all you need to do is to falsely fill out a form by yourself and boom, tax fraud. Since the Fair Tax is collected at the retail level, tax fraud would have to be through you the buyer, and through the retail seller. You'd need 2 parties to create similar fraud. And if that doesn't give you a different perspective, then try this neat thought: whats easier to track and police? a few hundred million individual income earning people? or a few tens of thousands of businesses? ;p This is a major moral argument i like to make myself, that one should not have to pay to stay compliant with the law. The average American's compliance cost is somewhere around 60 hours of work to just process their taxes; not even paying, just the processing.
Ok, you and I have hashed this out before, and we'll just continue to disagree. I will conclude with this response, these tax plan discussions only end up resulting in the opposing viewpoints just pissing in the wind. I think the FairTax has its merits, just not enough to warrant the transition. I'll continue to disagree with you on the regressivity of the FairTax. Simply put, the lower one's income, the more he/she spends on consumption as a percentage of income. That makes the FairTax regressive, despite the efforts of the prebate. http://taxprof.typepad.com/taxprof_blog/files/bartlett_fair_tax.pdf That link above gets into a more thought out explanation as to several of the drawbacks of the plan, not just its regressive nature. It's part of what we reviewed as a counterpoint to the FairTax presenter we had in class. A brief response to some of the other issues you brought up that aren't covered in the article. Visibility: The book asks the question (as you did on this forum a while back): How much did you pay in taxes last year? I'll bet that your answer didn't include the ever-so-visible sales tax. Why was that? Can you tell me what you spent in sales tax yesterday? Last week? Last month? Last year? How is the sales tax that's on the tax register receipts that you get any more visible that the withholdings shown on my paycheck? I'll bet 98% of the people on this forum have no idea what they spent last week on consumption (and therefore haven't a clue what they paid in sales tax), let alone have the ability tell me what the sales tax is in the city/county they live, so the concept of visibility is moot to me. We're far too lazy to care. Thanks for the discussion, as before, though it is getting tiresome going through this every year with a new thread. I don't have enough time to answer this as I'd like. I feel as though it's important to show the potential drawbacks to the system, perhaps that it's not quite as Fair or effective as one might think.
To expand on that... IIRC, 99% of consumer spending is done through major retail chains (i.e. walmart, home depot, target...) who would strictly comply with the consumer "fair" tax. As Mallard said, that other 1% ("tens of thousands of businesses") would be easier to monitor than hundreds of millions of people, the majority of whom are dishonest. It's all about transparency, broadening the tax base, taxing those who are currently cheating, and ultimately lessening the burden on honest citizens.
I disagree. Calm discussion is always fun, and i think critical to approaching mutual understanding. ;] I like explaining things that are misunderstood, and I like hearing perspectives and good objections that I hadn't thought about before. But if you're bored with it, then of course its no fun... Unfortunately, Bartlett's credibility takes a severe blow because he continues to erroneously insist that the 'Fair Tax' is a product of a fringe Scientology group. But on the presumption of his first posit, lets analyse the following from his report a bit: His table lists taxpayers broken into quintiles by how much they pay as individuals, but doesn't list them by how much of all the taxes each group pays. To cite him as a source is to agree that most people don't pay income tax anyways. Lets keep that in mind. There's 2 problems i wanna point out with his opening remarks leading to that table and conclusion. One is; he assumes %100 spending of your income under the Fairtax. He has to in order to make an apples to apples comparison. This is because under the current income tax, ALL of your income (to a point) is taxed in its entirety. Therefore, the only way to make a similar Fair Tax comparison is to say you've spent every last dime you made to expose it to being 'Fair Taxed.' But is it really intellectually sound to make such an assumption that everyone that Bartlett seems to be concerned for spends EVERYTHING they make and save nothing at all? Savings would have mega-huge benefits under the Fair Tax. Remember, Fair Tax is only collected when spent at retail, so you can put money in savings and in interest drawing investments without having to pay any taxes. Currently, if you want to save money you still have to pay income taxes no matter what(except for a 401K, with major restrictions) . So Mr Bartlett in order to make the numbers match for his comparison must use %100 spending in his example or the numbers don't work. How many people do you know that save absolutely nothing, disposing of every paycheck as their lifestyle? I know such people exist, but those people are living beyond their means. For those people riding that financial edge all the time, the Fair Tax could very well be perceived as disadvantageous, but thats only compared to the guy next door who is saving. And, if that wasn't enough, he DOES later in this paper point out "The assumption that everybody spends all of his income every year makes the tax rates on the wealthy appear much higher than they actually would be. In the real world, consumption falls as income rises." He points this out in such a way as a 'gotcha,' as though the rich are going to get away with something. But why would he point out this false spending assumption only for 'the rich?' Two is; he is not quite connecting the dots on ALL of the taxes being repealed, he only refers to "elimination of income and payroll tax." Those are not the only taxes repealed, and those aren't the only taxes that have embedded consequences in products and in your net income. The following taxes are repealed with the Fair Tax bill: personal income tax, businesses payroll tax( taxes that your employer pays to have you working for them, but they don't really pay it, they just pay you less to cover for it), the capital gains tax on investments for business and individuals, corporate income tax, Social Security tax, Medicare tax, and self-employment tax (you pay this as a combination of personal income tax and payroll tax all at once). So when Bartlett says "The prices of the things he buys will rise by more than his income rises from the elimination of income and payroll taxes." He's right. And he's right because he is failing to mention all the other taxes I just have. That seems a little intellectually incomplete to me, why would he omit such a critical crux of the bill? and lastly, Bartlett unfortunately, despite his years of financial experience, basically fell into the same 'straw man' trap that most Fair Tax critics do. In this report, he basically changed what the Fair Tax is into something else, and then proceeded to criticise what he changed it into. Straw Man Example: Do you see what he essentially did? Instead of giving an intellectual critique of the actual bill document, he gave his own personal interpretation of what changes he thinks represent it, and then called that a bad idea. He setup a straw man to knock over. Bartlett's example here basically changes something to satisfy what I can only imagine is his own personal sense of social justice that would make the Fair Tax acceptable to him. (we can debate that point seperately.) Only problem with this is when he makes that change, its no longer the Fair Tax. It becomes "Bill Bartlett's impression of a national retail sales tax plan," but instead of calling it that, he tries to continue to call what he just created the Fair Tax, and then use that for his criticism. Thats a really weak way to make an argument. Thats like Subaru saying the 2011 STI concept will ship with 400hp, and then a car magazine editor saying "No it won't because nobody would pay the insurance on a 400hp car, therefore nobody will buy it. So it will have 350hp detuned instead, cost the same, and the STI will therefore suck." oh noes, character limit reached...
part 2...... Well, this kinda ties into my personal observation I made up there about people at maximum consumption threshold, and that they are living outside their means. I'm personally quite confident that most people who live like that (disbarring temp circumstances, like education, short term personal emergency, health, etc) actually have NO idea how much they are actually spending. Thats a piece of the financial irresponsibility puzzle that lets a person get to the place where they are living beyond their means. As far as me personally, yeah, I can calculate my sales tax expenditures last year (though not off the top of my head like I can with income.) And anyone who has any idea how much they spend can get pretty close to calculating it too using their home base as the main tax rate. But I can note many people who see the visibility that you have disinterest in and the compliance cost as one issue in the same. The reason compliance cost is so high is in no small part because of how non-transparent the income tax system is. I can't make you care about it more, but if you can see another angle of why its appealing to others in combination with other issues, maybe you can offer more criticism? In general, this 2007 paper is riddled with flaws that show he didn't take a complete picture of HR25 to form his analyses, as well as logical errors with the way he presents an arguement (such as suggesting character flaw in the supporter instead of the issue) . Things like ignoring no taxes on used goods in his figures that assume everyone buys new, complaining about mortgage interest deduction on your income tax going away(why would you need a deduction on paying $0 income tax?), references to a Tax Reform Commission report that was also riddled with flaws and 'strawman' changes and has been undone thoroughly... Check out this reading for a fisking of Bartlett's analysis by the Boston University professor of economics, and Democrat party supporter. http://people.bu.edu/kotlikoff/New Kotlikoff Web Page/Revised Kotlikoff on Barlett 1-15-08.pdf And I'm glad for it. Finding calm but thoughtful and critical opinions of the Fair Tax is actually kind of rare, so I want to see them keep coming up. The enemy, we must remember, is the current tax system. Any and all discussion to change it has much more potential benefit than leaving it as is.
I have to agree, the enemy IS the current tax system. Imagine going from a system where you get to keep all you earn on each paycheck, get money to cover a portion of the taxes at the beginning of each month, get to SAVE MONEY tax free, invest tax free, grow your retirement tax free, and then someone comes along and says, well we are going to tax all that and when we take too much of your money, we might give back a little of it at the end of the year. I think this would cause a riot!! I believe everyone out there would be dead set against it. But instead we have people trying to confuse the process and trying to make something that could be extremely beneficial to the country and the OVERWHELMING majority of the people in it sound like a poor idea. Every criticism out there I have seen has been all smoke and mirrors. I think the main issue people in Washington have with it is the fact that it would take away their ability to solely tax one group of people unfairly. That goes back to the whole class warfare which is another discussion for another day.
Just a question, as I'm not well read on the subject... But doesn't this subject rank right up there with Universal Healthcare, on the list of things that sound good but are never going to happen?? Not trying to be negative, it just seems like a pipe dream. The US fears change.....