What do you think of this Fair Tax proposal?
- Thread starter hapaboy
- Start date
A flat consumption tax is the only way to go.
23% is far too high, though. Try 15% on consumption + exports.
Proponents argue that the FairTax is much fairer than the income tax. From the website:
The income tax is holding us back and making it more difficult than it needs to be to improve our familiesâ standard of living. It makes it needlessly difficult for our businesses to compete in international markets. It wastes vast resources on complying with needless paperwork.
Wealthy people spend more money than other individuals. They buy expensive cars, big houses, and yachts. They buy filet mignon instead of hamburger, fine wine instead of beer, designer dresses, and expensive jewelry. The FairTax taxes them on these purchases. If, however, they use their money to build job-creating factories, finance research and development to create new products, or fund charitable activities (all of which help improve the standard of living of others), then those activities are not taxed.
Under the FairTax plan, poor people pay no net FairTax at all up to the poverty level! Every household receives a rebate that is equal to the FairTax paid on essential goods and services, and wage earners are no longer subject to the most regressive and burdensome tax of all, the payroll tax. Those spending at twice the poverty level pay a tax of only 11.5 percent â a rate much lower than the income and payroll tax burden they bear today.
Under the federal income tax, slow economic growth and recessions have a disproportionately adverse impact on lower-income families. Breadwinners in these families are more likely to lose their jobs, are less likely to have the resources to weather bad economic times, and are more in need of the initial employment opportunities that a dynamic, growing economy provides. Retaining the present tax system makes economic progress needlessly slow, thus harming low-income people the most.
In contrast, the FairTax dramatically improves economic growth and wage rates for all, but especially for lower-income families and individuals. In addition to receiving the monthly FairTax rebate, these taxpayers are freed from regressive payroll taxes, the federal income tax, and the compliance burdens associated with each. They pay no more business taxes hidden in the price of goods and services, and used goods are tax free.
This isn't about WHERE the tax money goes, but the system of taxation. And by the way, you already pay more for the war in Iraq, etc., than someone who makes less than you.
The proper tax rate has been carefully worked out; 23 percent does the job of: (1) raising the same amount of federal funds as are raised by the current system, (2) paying the universal rebate, and (3) paying the collection fees to retailers and state governments. Unlike some other proposals, this rate has been independently confirmed by several different, nonpartisan institutions across the country. Detailed calculations are available from FairTax.org.
It was a very lengthy quote which unfortunately did not address my question - why do you think taxing consumption is any more or less fair than taxing wealth or income. And btw...
Wealthy (and poor) people buying cars, houses, yachts and hamburgers create as many (if not more) jobs as when they are building job-creating factories. Jobs are not created by building factories, jobs are created by increased demand for goods and services and the entire paragraph is economic nonsense.
The proposal is supposed to be revenue neutral - in other words for every net winner there will be a net loser. What's the point then, there are hundreds of other better ways to simplify the existing system.
If you do not consider the elimination of federal taxes, death taxes, estate, gift, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes, along with taking home 100% of your paycheck, and instead being taxed for your level of consumption as being "fair," well, that's your opinion and your entitled to it.
Furthermore, did you ever consider that the millions of illegal workers who don't pay income taxes would now be paying consumption taxes along with every citizen and tourist?
Well, dddooo, many economists differ with your opinion....By all means go ahead and explain one of your hundreds of ways to simplify the existing system, and try to have it passed at the national level.
IMO the Fair Tax is pretty much as simplified as it gets.
Have you even checked out the web site and read the information available there, or are you arguing merely for the sake of arguing?
If you do not consider the elimination of federal taxes, death taxes, estate, gift, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes, along with taking home 100% of your paycheck, and instead being taxed for your level of consumption as being "fair," well, that's your opinion and your entitled to it.
No, it has nothing to do with 'fairness', replacing ten taxes with one may arguably be more convenient but does not mean this one tax is necessarily fair. As I said before it will be just as "unfair" if I have to pay more than you for Katrina, Iraq and Medicare just because I bought 2 plazma TVs this year and you bought one.
IMO the Fair Tax is pretty much as simplified as it gets.
Too bad simplicity does not always translate into fairness or appropriateness and does not always make economic sense.
are you arguing merely for the sake of arguing?
I am arguing because I don't see it as fair, because it will cause a huge drop in consumption and destroy our consumer driven economy. I am arguing because with a revenue neutral system there will be winners and losers and I find it very hard to believe that the poor and middle class will come out on top in a system designed and overwhelmingly supported by the rich.
There are so many holes in this that it ain't even remotely funny. I can hear Jesse and Al winding up now claiming that the rebate is not enough. Wages will still be too low also. And the argument that the wealthy can afford a little more than the poor still drives the class envy crowd.
My personal problem is with the term "Rebate." The definition for the word is:
a deduction from an amount to be paid or a return of an amount to be paid
If you've paid in nothing, or a little, how can you expect a lot BACK? The NAACP argument is that the wealthy can afford more therefore they should pay a larger share of ANY AND ALL burdens. They will not change the tune as that's what they are founded on.
Again, your argument is directed toward where the tax revenue goes. This is about how revenue is collected. If you don't like the fact that your taxes go to the war in Iraq, you should write your Congressman.
What is unfair about the proposal, other than the fact that the revenues will be used for the same things they're used for now, which you don't like?
A plethora of economists vehemently disagree with you. Please elaborate on how the proposal would "destroy our consumer driven economy."
Furthermore, so what if the rich support it if it makes sense and will help lower-income famillies? Rich people would have to pay their fair share no matter how many lawyers, lobbyists and accountants they had on the payroll!
And besides, it is not only rich people who support it. Growing numbers of the middle-class and lower-class also support it as word gets out and they see the benefits of the proposal.
Let the NAACP bitch.Quote from canyonman00:
There are so many holes in this that it ain't even remotely funny. I can hear Jesse and Al winding up now claiming that the rebate is not enough. Wages will still be too low also. And the argument that the wealthy can afford a little more than the poor still drives the class envy crowd.
My personal problem is with the term "Rebate." The definition for the word is:
a deduction from an amount to be paid or a return of an amount to be paid
If you've paid in nothing, or a little, how can you expect a lot BACK? The NAACP argument is that the wealthy can afford more therefore they should pay a larger share of ANY AND ALL burdens. They will not change the tune as that's what they are founded on.
In the meantime, it's worth a try IMO.