23% sales tax only?

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[ARCHIVED THREAD] - 23% sales tax only?

Posted: 9/24/2004 2:06:17 PM EDT

Would you go for that? No other fed taxes?

Posted: 9/24/2004 2:09:21 PM EDT

[#1]

how about a 15% strait tax, no deductions.

Posted: 9/24/2004 2:10:07 PM EDT

[#2]

I would be thrilled if the gov. went to a flat tax (sales tax) system.

They will never do it. It would throw thousands of valuable IRS workers out of business, not to mention tax preparers and tax lawyers.

Oh yeah, lets not forget. Then congressmen would be paying taxes too. This will never be.

Posted: 9/24/2004 2:10:18 PM EDT

[#3]

Sounds good too but some Republicans are pushing a 23% Federal sales tax

Posted: 9/24/2004 2:10:44 PM EDT

[#4]

Doesn't work for me.

Posted: 9/24/2004 2:10:56 PM EDT

[#5]

Quoted:
I would be thrilled if the gov. went to a flat tax (sales tax) system.

They will never do it. It would throw thousands of valuable IRS workers out of business, not to mention tax preparers and tax lawyers.

Oh yeah, lets not forget. Then congressmen would be paying taxes too. This will never be.

My mom said the same thing: Nice but no chance.

CRC

Posted: 9/24/2004 2:11:47 PM EDT

[#6]

Works in other countries. I was in south america 23% IVA (Added Value Tax) and 4% property tax and thats it.

Posted: 9/24/2004 2:12:33 PM EDT

[#7]

too much for me.

[kerry]the weathiest 1% would love it though[/kerry]

Posted: 9/24/2004 2:13:33 PM EDT

[#8]

But you would not pay any other Fed taxes?

Inez Tennebaum is slamming Jim DeMint over this in SC.

Posted: 9/24/2004 2:15:44 PM EDT

[#9]

Quoted:
Would you go for that? No other fed taxes?

In a heart beat.

I live modestly and that would mean a ton of cash back in my pocket.

Posted: 9/24/2004 2:15:48 PM EDT

[#10]

I thought the idea was they were going to get rid of the IRS and institute the sales tax. I'd much rather have the sales tax than an income tax.

Posted: 9/24/2004 2:17:23 PM EDT

[#11]

Yeah keep all your own money but a compact car (read Geo Metro) costs $23K while I was in South America.(of course that included import fees)

Posted: 9/24/2004 2:18:02 PM EDT

[#12]

I would turn into the world's biggest saver... lol, wouldn't buy shit... love it!

Posted: 9/24/2004 2:18:56 PM EDT

[#13]

Taxing what you consume makes a lot more sense to me than taxing what you earn.

Posted: 9/24/2004 2:19:54 PM EDT

[#14]

Would guns be taxed twice?

Posted: 9/24/2004 2:21:04 PM EDT

[#15]

It seems on the high side.

But then they're taking more than that out of my paycheck as it is.

Posted: 9/24/2004 2:23:28 PM EDT

[#16]

This borrow-and-spend economy would go down the shitter in a month. Saving is great but it doesn't generate a lot of retail sales, which of course lowers commercial spending, which lowers industrial spending... Which means less jobs all around.

Japan recently had a negative interest rate for people saving their money in traditional savings accounts. They were actually LOSING money by having it in the bank. That's mostly because they as a culture like to bank a lot of their earnings.

The best situation is to be a saver and investor in a spendy economy.

Posted: 9/24/2004 2:26:23 PM EDT

[#17]

You guys must be forgetting that we currently work the first five months of the year to satisfy all our tax obligations for that year.

People would crap their pants if they knew how much of their money goes to taxes.

Posted: 9/24/2004 2:30:49 PM EDT

[#18]

Here is a column that Neil (High Priest of the Painful Truth) Boortz wrote on the Fair tax plan.

Imagine receiving 100% of your paycheck!
Neal Boortz (archive)

August 27, 2004

Two weeks ago a man stood up at a George Bush campaign appearance in Florida to ask about a piece of legislation known as HR25. Many, including myself, were pleased to hear Bush respond with some positive thoughts about the Fair Tax plan, a movement to replace the federal income tax with a national retail sales tax.

Washington is a city of inertia, and right now the inertia belongs to our present method of funding the operations of our government, the income tax. Politicians will not easily surrender a funding mechanism that lends itself so well to political demagoguery and which can be used to reward political allies and punish enemies.

The Fair Tax plan deserves a thorough public examination and debate. John Kerry seems dedicated to making sure this doesn’t happen. Soon after Bush cited the national retail sales tax as something worthy of further exploration, Kerry stepped forward with the typical class warfare rhetoric of the left. Acting as if he actually knew what was he was talking about (he didn’t), Kerry announced that the Fair Tax would amount to the largest increase in the tax burden on poor and middle income Americans in our history.

John Kerry was wrong. He was either speaking out of ignorance, or he was deliberately lying about the Fair Tax proposal in order to gain a political advantage. A politician lying in order to gain political advantage --- imagine that.

This column is lengthier than the norm, but I promise you that if you will invest the time it takes to read it you will be well on your way to becoming yet another rabid supporter of the Fair Tax plan. You will know that the poor and middle income Americans would be the prime beneficiaries of the proposal. You may even organize your own neighborhood march on Washington to demand that HR25 receive a fair hearing. In the next two minutes I’m going to turn you into a HR25 Fair Tax zealot. Read on:

First … the briefest of overviews: Simply put, HR25 would provide for the repeal of the 16th Amendment (the income tax amendment) and the dismantling of the IRS. All personal and corporate income taxes would end, as would all payroll taxes. There would not be one cent of federal taxes of any nature taken out of your paychecks. No more Social Security taxes. No more Medicare taxes. You earn $2,000 a payday; you get $2,000 a payday. The federal government would be funded through a national sales tax on goods and services sold at the retail level. No taxes on investments. No taxes on savings. You only get taxed on what you spend at the retail level. Store your earnings in a shoebox if you wish. They won’t be taxed.

When originally proposed, calculations showed that the sales tax would have to be in the area of 23%. A complete economic study is now being completed that is expected to bring that total to under 20%. For the purposes of this column, we’ll stick with the 23% figure.

OK … let’s put on our sensitivity hats for a few minutes here and think of the consequences of the Fair Tax Act on our nation’s poor, poor, pitiful poor. After all, they can hardly afford a 23% sales tax when they’re living paycheck-to-paycheck in the first place, right?

Bear in mind that for the most part those whom we define as “poor” aren’t paying any income tax anyway. In fact, many of them are getting checks from the government; a form of outright income redistribution. The absurdly named Earned Income Tax Credit, for example. How can these people survive going from a no-tax situation to paying a 24% sales tax on all their retail purchases?

The implementation of the Fair Tax would fail in short order if, as the question presupposes, nothing were to change except that all of us would be paying today’s prices for a gallon of milk or a loaf of bread, plus a 23% sales tax. But … that’s would be far from the reality under the Fair Tax. Under the Fair Tax the poor won’t only survive, they’ll positively thrive! The Fair Tax could turn out to be the best poverty-fighting tool devised in this country since the concept of hard work.

Let’s begin by considering two realities.

First, remember, please, that the poor, along with everybody else, will no longer have Social Security taxes or Medicare taxes withheld from their paychecks. Whatever they earn, they get on payday. For the poor this means an immediate 12 to 15% increase in their earnings.

Second. Don’t forget the 22% in imbedded taxes. These embedded taxes exist in virtually everything poor Americans or any other Americans have to buy. These embedded taxes represent all of the corporate and business income taxes and payroll taxes that the companies involved in the production, manufacture, marketing, distribution and sale of the goods and services must pay in the course of business. As soon as these taxes are gone, and after the competitive forces of the free market work their magic consumers, including the poor, will be paying at least 20% less for virtually everything they buy. This includes such basics as food, clothing, shelter and transportation. Yes... they’ll have to pay the new national sales tax, but when you factor in the lower prices caused by the disappearance of the embedded taxes you’ll see that the total price paid for consumer goods in terms of real dollars will fall or will remain very nearly the same.

So … just considering these factors, the Fair Tax delivers a winning hand to people living in or near to what we call poverty. They get every penny they earn on payday, amounting to a 12 to 15% pay raise, and when you factor in the Fair Tax and the lower prices, they’re actually end up spending less of their money for a retail purchase than before. What John Kerry calls the greatest increase in the tax burden on the poor in the history of our country is, in reality, their greatest tax reduction.

You need a clearer picture? Pull out your calculator. Let’s say that a single mother with two children spends $45 a week on groceries. The removal of the 22% embedded tax would bring the price of those groceries down to $35.10. The sales tax at 23% would be $8.07. This brings the total price to $43.17. That’s less than would have paid under today’s tax system. This single mother, whom we’ll consider “poor,” has just received a 12% to 15% increase in her weekly paychecks, and she’s paying less at the grocery story for her basic necessities.

So far, so good. At this point you should be thoroughly convinced that the Fair Tax would actually benefit, rather than harm the poor. But, then again, maybe not. Here’s the convincer. Brace yourself for the knockout punch.

The Rebate

Under the Fair Tax plan every consumer, rich and poor alike, will receive a check or an electronic credit to their bank account from the federal government every single month equal to the sales tax that person or that family would be expected to pay on the purchase of the basic necessities of life for that month. The size of the monthly payment will be based on the government’s published poverty levels for various sized households.

Here’s an example of how the rebate payments would have worked in 2003.

Let’s say you’re a married couple with two children. The Fair Tax Act sets forth a formula for computing the poverty level, based on government figures, which negates any marriage penalty. If the Fair Tax Act had been law in 2003 you would have been granted an annual consumption allowance of $24,240. This is what the government would assume you would have had to spend during that one year to buy the basic necessities of life for your family. The sales tax on this amount would equal $5,575. The government would have rebated this amount to you in 12 equal monthly installments of $465. What about a single woman with one child? Her monthly rebate in 2003 would have been $232. The lowest payment would be to a single person with no dependents. That person would have received $172 per month.

Now … bear in mind, this rebate isn’t only paid to the poor. It is paid to everyone, rich and poor alike. The purpose here is to make sure that no American has to pay the Fair Tax sales tax on the basic necessities of life. Unlike the present income tax system, the Fair Tax treats each and every person in this country exactly the same. This, of course, presents somewhat of a problem to politicians who like to use the tax code to foment class distrust or outright warfare.

OK … let’s add it up for America’s lower income citizens:

1. They get their entire paycheck.
2. Even with the sales tax, and considering the drop in prices, they’ll be paying essentially the same or less for everything they buy.
3. They get a check from the federal government every month to rebate any sales taxes they had to pay on life’s basic necessities.

Are you beginning to see just how far off-base John Kerry was with his intemperate criticisms?

Though most of the poor don’t have what we would call complex tax returns, let’s also include the time these they (all of us, really) will save by not having to keep tax records or file tax returns.

If you’re looking for some reason to oppose the Fair Tax plan, you’re going to have to find a better excuse than its effect on the poor. John Kerry might find it politically expedient to demagogue the issue for votes, but now you know enough to know what he’s up to.

For more comprehensive information on The Fair Tax you can visit http://www.fairtax.org.

Posted: 9/24/2004 2:33:25 PM EDT

[#19]

Won't work for me.

I doubt if 23% would be enough to pay all the bills.

Posted: 9/24/2004 2:44:14 PM EDT

[#20]

This only part of the Federal tax you pay - don't forget SSI and Medicare. A consumption tax is good for consumers that are frugal, bad for spenders. Besides, the spenders on both sides of the aisle are voracious and will eat this revenue quickly, soon followed by restoration of the income tax.

Posted: 9/24/2004 2:47:54 PM EDT

[#21]

I would go 25%, I'm in the 38% now plus 15.3 % s.e.t.

Posted: 9/24/2004 2:48:51 PM EDT

[#22]

This would be one of the most regressive tax system. Discourages buying/trade. Negatively impacts the poor far more than the rich.

Posted: 9/24/2004 2:49:40 PM EDT

[#23]

I know this in the post above but roughly 20% of all retail cost is used to cover payroll and other types of tax. With these gone we should see about a 20% reduction in cost of goods (in theory I know). That pretty much evens out. Couple that with the 40% of your paycheck you get back and it's a good deal..but as said above add in congress having to pay those taxes and you've got the old snowball in hell cliche.

Posted: 9/24/2004 2:54:51 PM EDT

[#24]

Quoted:
This would be one of the most regressive tax system. Discourages buying/trade. Negatively impacts the poor far more than the rich.

I'm tired of hearing about the poor.

90% of the "poor" in America have 2 tvs, a car,cable,all appliances, and live in larger sq. ft. house than the average income person does in any major city in the world.

The top 1% of wage earners pay 90 something% of all taxes paid.

Now you tell me thats fair. Plus a tax on purchases would make the illegals turn loose some of that $$$ that they aren't paying income tax on now and not send it to some 3rd world shithole so they can bring more of them over here.

Posted: 9/24/2004 3:11:42 PM EDT

[#25]

23% is federal only, it would probably go to 35% when you include state/local taxes. (think 8% local sales tax, plus state income tax, plus local property tax)

Remember, even if the tax system changes dramatically, it's still going to have to extract the same amount of money from the people. The current tax system operates at an equilibrium between opposing forces (raise vs cut, progressive vs regressive, lobbyist A vs lobbyist B). I fear that any major new tax system would eventually be hammered into the same sort of equilibrium, with the same people paying about the same as they are now. (if you really want to change the system permanently, we need to change the fundamental legislative machinery - campaigning, elections, lobbying, etc - not individual rules).

I agree that more transparency would be helpful in any case. Citizens should know what they are paying, and what services they are receiving in return.

Also we need to dispense with this silly "tax cuts are for the rich" rhetoric. The tax system is so progressive that it's virtually impossible to construct a tax cut plan that won't favor the rich. (hmm, I wonder if it's designed that way for a reason...)

Posted: 9/24/2004 3:15:34 PM EDT

[#26]

Also, don't forget the amount of tax money that would come in from the millions of foreign tourists that come in every year. Just think of say Orlando, FL. How many foreign visitors visit that city every year? Think of how much extra money would be made off of the foreign tourists spending their money in these places.

Posted: 9/24/2004 3:16:43 PM EDT

[#27]

I would jump on it with both feet. The basic assumption for minimum income tax (assuming you pay it, as opposed to filing a "tax return" underwhich you pay nothing and get the $3500 "earned income tax credit" - a friggin check to compensate you for contributing NOTHING to the shared cost of gov't services) is 22%. So right now, we all pay 22% or more income & payroll tax, plus sales taxes, et c. et c. People who actually pay taxes now would pay less than they do now.

ETA: I'd cheerfully forego the "rebate" program just to stay off their damned lists.

Posted: 9/24/2004 3:16:50 PM EDT

[#28]

Hell YES!!
I'd be forced to limit my spending in order to save a shitload of cash. I'd be seriously discretionary about any purchase.

Posted: 9/24/2004 3:25:56 PM EDT

[#29]

I dunno, but if it ever passed, I'd buy stock in Ebay and anyone else that sells used items--unless the Gov.org changes the way things are sold between individuals, you will start to see a HUGE surge in sales of used stuff between individuals and more of the barter system.

AFARR

Posted: 9/24/2004 3:28:01 PM EDT

[#30]

Quoted:

I'm tired of hearing about the poor.

90% of the "poor" in America have 2 tvs, a car,cable,all appliances, and live in larger sq. ft. house than the average income person does in any major city in the world.

The top 1% of wage earners pay 90 something% of all taxes paid.

Now you tell me thats fair. Plus a tax on purchases would make the illegals turn loose some of that $$$ that they aren't paying income tax on now and not send it to some 3rd world shithole so they can bring more of them over here.

Your estimates are off, it's more like the top 25% earners paying over 80% of taxes. I am fortunate to belong to this group and I harbor no bitterness or sense of injustice in having to pay a higher share within reason. Unlike you, some of us do care about the poor.

Posted: 9/24/2004 3:32:57 PM EDT

[#31]

Quoted:
Quoted:

I'm tired of hearing about the poor.

90% of the "poor" in America have 2 tvs, a car,cable,all appliances, and live in larger sq. ft. house than the average income person does in any major city in the world.

The top 1% of wage earners pay 90 something% of all taxes paid.

Now you tell me thats fair. Plus a tax on purchases would make the illegals turn loose some of that $$$ that they aren't paying income tax on now and not send it to some 3rd world shithole so they can bring more of them over here.

Your estimates are off, it's more like the top 25% earners paying over 80% of taxes. I am fortunate to belong to this group and I harbor no bitterness or sense of injustice in having to pay a higher share within reason. Unlike you, some of us do care about the poor.

My point is not that I don't care, it is the definition of "poor" Most of the poor are just lazy or goverment subsidized for generations. When you are "broke" you go to "work"

On top of that who said you can only work 40 hrs a week? The kids need shoes, the house needs repair, get off your ass and go make some $$$. Its the lazy people that I have no respect for, not the ill, handicapped,etc.

Also the statistics are correct. You prove otherwise.

Posted: 9/24/2004 3:43:02 PM EDT

[#32]

Quoted:
Its the lazy people that I have no respect for, not the ill, handicapped,etc.

That I agree with 100%
The difficulty comes in putting together a "simple" tax system that recognizes true difficulties faced by people that work hard yet remain poor for whatever reason (single moms, illness, low paying unskilled laborers, etc) while eliminating benefits that provide incentive for the lazy to leech off the system.

Posted: 9/24/2004 3:47:02 PM EDT

[#33]

Quoted:
Quoted:
Its the lazy people that I have no respect for, not the ill, handicapped,etc.

That I agree with 100%
The difficulty comes in putting together a "simple" tax system that recognizes true difficulties faced by people that work hard yet remain poor for whatever reason (single moms, illness, low paying unskilled laborers, etc) while eliminating benefits that provide incentive for the lazy to leech off the system.

If they are that poor, they don't need to buy anything but needs,not wants. Maybe no tax on groceries?

btw are you a democrap?

Posted: 9/24/2004 3:48:00 PM EDT

[#34]

Quoted:
Would you go for that? No other fed taxes?

How bout 10% FLAT tax. No tax shelters no exemptions and EVERYONE pays.

Posted: 9/24/2004 3:49:51 PM EDT

[#35]

Quoted:
This only part of the Federal tax you pay - don't forget SSI and Medicare. A consumption tax is good for consumers that are frugal, bad for spenders. Besides, the spenders on both sides of the aisle are voracious and will eat this revenue quickly, soon followed by restoration of the income tax.

Read the above post about Boortz. It includes SS and Medicare.

Posted: 9/24/2004 3:51:46 PM EDT

[#36]

The only thing I'd be pissed off about is that as a college student, I have basically no income. I'm living off of my savings, which i've already been taxed on. The result is right now I pay very little tax (and am basically living like I'm broke) -- forcing me to pay a 23% tax on everything would mean that I couldn't finish school.

Posted: 9/24/2004 3:53:53 PM EDT

[#37]

A flat tax sounds good but I just don't think it's viable. When all you know is "I worked at X, I made Y dollars... my tax should be Z" it makes sense. When you get into all the complicated financial structures, accounts, investments, deals, and business structures leading up from self employed to Corps along with all the ins and outs of investments it becomes much more complicated than "take your income times X".

Posted: 9/24/2004 3:56:55 PM EDT

[#38]

Quoted:
Quoted:
Would you go for that? No other fed taxes?

How bout 10% FLAT tax. No tax shelters no exemptions and EVERYONE pays.

Nope.

Any income tax is essentially confiscation of wealth.

Sales tax is voluntary. If I don’t want to pay tax, I don’t buy big ticket items. Sure, I’ll pay a little bit buying essentials. No big deal. I still come out WAY ahead.

The way Americans spend, and would spend with all that extra money, would probably put the government ahead.

More importantly, it would allow those of us who are interested in keeping what we make a choice to do so.

Posted: 9/24/2004 3:58:04 PM EDT

[#39]

Quoted:
A flat tax sounds good but I just don't think it's viable. When all you know is "I worked at X, I made Y dollars... my tax should be Z" it makes sense. When you get into all the complicated financial structures, accounts, investments, deals, and business structures leading up from self employed to Corps along with all the ins and outs of investments it becomes much more complicated than "take your income times X".

Simple what you make is what you bring home, what you buy add 23% at the register.

No IRS, so it must be easier.

Remember what I said earlier, How many illegals are here? Millions???? Those millions would have to pay the 23% too, think about that. That alone would steal some of their reason to sneak their asses in here and work off the clock or claim 10 exemptions.Everytime they buy some bling bling or those damn wheels that keep spinning when they stop thats more$$$$. There would be no deficit.

Posted: 9/24/2004 4:03:10 PM EDT

[#40]

tag

Posted: 9/24/2004 4:07:41 PM EDT

[#41]

I couldn't imagine paying 23% tax on something big like a car. yikes!

Posted: 9/24/2004 4:09:39 PM EDT

[#42]

The fact is, you already do.

Posted: 9/24/2004 4:14:37 PM EDT

[#43]

With the amount of tax writeoffs I usually have each year, the 23% sales tax would cost me much more than the current system. Last year I had a net income of $5500.

Posted: 9/24/2004 4:24:52 PM EDT

[#44]

Um, what would happen is that would get passed, and then they would forget to repeal the income taxes. We would end up with both in all likelihood. Then they would spend 10x what they took in from the sales taxes.

Unfortunately, this would hurt the individual State's ability to generate revenue. As people buy less, they are also going to be giving less to their state government. Consequently, the States will depend even more heavily on Federal Aid. In turn, the Federal Government will force the State legislatures to adopt whatever laws they dictate as a condition of the federal aid. Then your freedoms will get eaten away all the quicker by federally mandated state laws.

No, as good as it at first sounds, the answer is revising the current system. And by revise, I mean scrapping the IRS and starting over.

Posted: 9/24/2004 4:52:48 PM EDT

[#45]

Quoted:
Your estimates are off, it's more like the top 25% earners paying over 80% of taxes. I am fortunate to belong to this group and I harbor no bitterness or sense of injustice in having to pay a higher share within reason.

That makes you a Communist.

You want to redistribute your wealth, go right ahead. There are hundreds of charities you can give your money out to if you want to save the world.

Social Security Disability. Medicaid. Food Stamps. Lower Income Tax bracket. Etc. Just how much more is enough? It's an endless pit. If you give a dog a bone, he will eat it and the marrow and be your best friend for life. Give a poor person a bone and they will ask why it doesn't have any meat on it. If it has meat, then they'll ask why is their piece smaller than yours? People aren't dogs. They will take and take and take if you are willing to give. They can and do abuse the system whenever possible. I witness this firsthand on a daily basis.

Quoted:
Unlike you, some of us do care about the poor.

Boys, I think we have a bleeder.

[ARCHIVED THREAD] - 23% sales tax only?

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