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SBK
09-13-2005, 11:08 AM
So Im sick of the blame game here, lets start a new discussion.......

Has anyone else read the book? The Fair Tax Book. You can also visit www.fairtax.org (http://www.fairtax.org).

http://www.amazon.com/exec/obidos/tg/detail/-/0060875410/qid=1126631119/sr=8-1/ref=pd_bbs_1/104-0172773-0261563?v=glance&s=books&n=507846

I have to say, after reading it, Im think it's the way to go. If you haven't read it pick one up and take a look. It's a great idea, and is compatible to both liberals and conservatives. Any questions, let me know and I'll help you out.

SBK
09-13-2005, 07:52 PM
I guess nobody gives a crap. It must be too much fun to fight amongst yourselves.

unlurking
09-13-2005, 08:01 PM
Have not read it, but I'd like to hear more about what it proposes if you don't mind taking the time to summarize. I'm a pretty firm believer in flat taxes at the moment, but open to other ideas that can help eliminate the bloat that has become the federal fovernment.

Phobia
09-13-2005, 08:02 PM
I'm in.

WoodDraw
09-13-2005, 08:52 PM
I haven't read too much on it but it seems like an interesting enough idea. A couple questions/concerns though:

No one seems to be real sure what rate would be needed to make it revenue neutral. Some estimates are as low as 20% while other are towards 50%. The low rates seem to be assuming a lot of resulting economic growth and if that doesn't happen then things would be kind of scary. Both sides will want to exempt their favorite things as well which will require a higher rate.

Also, the 16th Amendment would have to be repealed for this to work and that would take a true bipartisan effort that just doesn't exist right now. It would be hard enough to get the majority of Congress behind this, let alone 2/3 and 3/4 of the states.

And it always concerns me when proposals like this are completely supported by one side. All of the sponsors are Republicans at this point with Democrats wanting nothing to do with it. Is that all political or do they have legitmate concerns?

I'd be more interested in seeing Congress restore fiscal sanity before they tackle tax reform. It's an interesting plan though.

Boozer
09-13-2005, 09:26 PM
I haven't read too much on it but it seems like an interesting enough idea. A couple questions/concerns though:

No one seems to be real sure what rate would be needed to make it revenue neutral. Some estimates are as low as 20% while other are towards 50%. The low rates seem to be assuming a lot of resulting economic growth and if that doesn't happen then things would be kind of scary. Both sides will want to exempt their favorite things as well which will require a higher rate.

Also, the 16th Amendment would have to be repealed for this to work and that would take a true bipartisan effort that just doesn't exist right now. It would be hard enough to get the majority of Congress behind this, let alone 2/3 and 3/4 of the states.

And it always concerns me when proposals like this are completely supported by one side. All of the sponsors are Republicans at this point with Democrats wanting nothing to do with it. Is that all political or do they have legitmate concerns?

I'd be more interested in seeing Congress restore fiscal sanity before they tackle tax reform. It's an interesting plan though.

I don't think the 16th Amendment would have to be repealed...it simply authorizes a "direct" income tax. The original text of the Constitution prohibits non-apportioned "direct taxes," but I'm not sure what that means, other than that the federal government cannot tax land in direct relation to land ownership. I don't know whether this would prohibit a national sales tax.

SBK
09-13-2005, 10:54 PM
I haven't read too much on it but it seems like an interesting enough idea. A couple questions/concerns though:

No one seems to be real sure what rate would be needed to make it revenue neutral. Some estimates are as low as 20% while other are towards 50%. The low rates seem to be assuming a lot of resulting economic growth and if that doesn't happen then things would be kind of scary. Both sides will want to exempt their favorite things as well which will require a higher rate.

Also, the 16th Amendment would have to be repealed for this to work and that would take a true bipartisan effort that just doesn't exist right now. It would be hard enough to get the majority of Congress behind this, let alone 2/3 and 3/4 of the states.

And it always concerns me when proposals like this are completely supported by one side. All of the sponsors are Republicans at this point with Democrats wanting nothing to do with it. Is that all political or do they have legitmate concerns?

I'd be more interested in seeing Congress restore fiscal sanity before they tackle tax reform. It's an interesting plan though.

I'll do my best to answer, but you'd do yourself well to pick up a copy of the book. All of the answers are in there, and it's not a bad read.

H.R. 25, has a rate of 23%. That sounds super high, but the Fair Tax gives the gov't one shot at your money. No payroll, estate, capital gains, FICA, social security, self employment, mediacare or all of the other taxes. You would receive 100% of your money, and the gov't would no longer be prying into your finances. This is good.

With the loss of all of those taxes companies pay, (ex. you pay 7.5% and they match your tax), cost to produce goods would go down. The book says that studies have shown everything you buy from a jumbo jet, to a loaf of bread have about 22% embedded tax in the price of that item. So, if you eliminated all of that tax, the cost of every item would drop 22%. So if you add a 23% tax to it, the cost should remain the same. (evil corporations will not keep that money, because the market will drive the price down. good examples of this type of thing in the past, but you have to read the book)

So basically it turns into you keep 100% of your check, and the price of goods would remain very close to the same.

They have also built in a way to keep poor folks from a higher tax burden than they have. They take the current poverty level, which is $26,000 or so, and cut every American a check for the tax that they would pay on that amount. That way lifes necesseties aren't taxed. I think it came out to like 400 or 600 bucks a month from uncle sam to you. This way, the poor pay 0 tax, but the system is fair to all Americans, something that the current system isn't.

With this system the IRS would be abolished, and the 16th amendment would be thrown out. I don't think it'd be too hard to get that passed, because who in this country actually likes the IRS?

Did I answer your questions?

SBK
09-13-2005, 10:56 PM
Have not read it, but I'd like to hear more about what it proposes if you don't mind taking the time to summarize. I'm a pretty firm believer in flat taxes at the moment, but open to other ideas that can help eliminate the bloat that has become the federal fovernment.

See my post below. It's a short summary. Or visit www.fairtax.org (http://www.fairtax.org).

SBK
09-13-2005, 10:57 PM
I'm in.

Me too. :clap:

SBK
09-13-2005, 10:58 PM
Let me add one thing that is hard for me to understand. This system is right up liberals alley. It taxes way more from the rich, poor folks pay no tax, and it will increase the amount of money the gov't brings in. However, liberals do not support it at all. It seems strange to me.

Miles
09-14-2005, 02:03 AM
I don't think the 16th Amendment would have to be repealed...it simply authorizes a "non-direct" income tax. The original text of the Constitution prohibits non-apportioned "direct taxes," but I'm not sure what that means, other than that the federal government cannot tax land in direct relation to land ownership. I don't know whether this would prohibit a national sales tax.

Yeah i dont understand why it would have to be either since it just allows the current tax scheme.

Before the 16th amendment direct taxes (basically property or income) had to be apportioned among the states with regards to population. The direct tax also had to be uniform to all people which prohibited the graduated tax rates.

Even if this tax scheme were a good idea, it wouldn't ever get put into place since part the plan requires the almost elimination of the tax code and the IRS. Politically it would be essentially impossible to just simply abolish the largest administrative agency in the county. The tax code also has lots of social engineering built into it which would make nearly impossible to eliminate for political reasons.

Boozer
09-14-2005, 06:23 AM
Does anyone have any figures on how much states pay to collect sales taxes? The current federal income tax (and despite all the rhetoric, the IRS) is extremely efficient. The IRS's expenses amount to less than 2% of the amount collected. How much does Texas spend on collecting its sales tax, measured as a percentage of revenue collected?

SBK
09-14-2005, 08:29 AM
Does anyone have any figures on how much states pay to collect sales taxes? The current federal income tax (and despite all the rhetoric, the IRS) is extremely efficient. The IRS's expenses amount to less than 2% of the amount collected. How much does Texas spend on collecting its sales tax, measured as a percentage of revenue collected?

The current system is entirely in-efficient. I don't have it here, but do you have any idea on the man hours it takes for we the people to prepare our tax returns? How many hours companies spend in deciding which moves they should or should not make based upon tax consequences? How many pages the current system is, and how even folks inside the IRS don't know it all?

If the fair tax were put in place, states would have to stop collecting income tax, as they use federal standards for collections, deducts and stuff. So there would be a little figure on top of the federal take for what the specific state would need.

SBK
09-14-2005, 08:31 AM
Even if this tax scheme were a good idea, it wouldn't ever get put into place since part the plan requires the almost elimination of the tax code and the IRS. Politically it would be essentially impossible to just simply abolish the largest administrative agency in the county. The tax code also has lots of social engineering built into it which would make nearly impossible to eliminate for political reasons.

Yeah, the current system is made by, and for politicians. It's completely unfair, which they can use to their advantage. They can pit one group against another, or promise some kind of tax "relief" for another group to gain votes.

Not to mention they can receive tons and tons of money from companies that want a small change to the IRS to benefit them in some way.

By the way, the Fair Tax is a great idea.

Adept Havelock
09-14-2005, 09:41 AM
Nice idea, but it will never happen.

1)IRS too protective of their turf.
2)Lobbying from Corporate interests, as there will be no loopholes to use to avoid paying their fair share.
3)Lobbying from an account/tax prep. industry that would find itself obsolete.

Find a way to deal with all the bribery....oh, I'm sorry, lobbying money, and the bill HR 25 might have the chance of a (frozen water) snowball in Oakland (the narcotic snowballs are readily available at the stadium).

Until then, a nice idea, but it's not realistic.

However, i've been wrong before.

patteeu
09-14-2005, 10:02 AM
...
They have also built in a way to keep poor folks from a higher tax burden than they have. They take the current poverty level, which is $26,000 or so, and cut every American a check for the tax that they would pay on that amount. That way lifes necesseties aren't taxed. I think it came out to like 400 or 600 bucks a month from uncle sam to you. This way, the poor pay 0 tax, but the system is fair to all Americans, something that the current system isn't....

This is my biggest disagreement with the Fair Tax although I understand that it's probably a political necessity. There shouldn't be any rebate or exemption for life's necessities. If there weren't, the rate could be brought down dramatically (I don't know how far, but it would be more than a couple of percentage points).

It's time for the poor to start paying their fair share of taxes. Everyone should be in the same tax boat so that we don't have one group pitted against the other all the time like we do now.

SBK
09-14-2005, 01:10 PM
This is my biggest disagreement with the Fair Tax although I understand that it's probably a political necessity. There shouldn't be any rebate or exemption for life's necessities. If there weren't, the rate could be brought down dramatically (I don't know how far, but it would be more than a couple of percentage points).

It's time for the poor to start paying their fair share of taxes. Everyone should be in the same tax boat so that we don't have one group pitted against the other all the time like we do now.

I agree. But unless Satan is out shopping for a winter coat, we'll never see it happen.

The prebate sounds crazy, but if you exempt certain things you'll have lots of groups trying to get other things exempted. So the prebate is probably the best thing you could come up with.

You'd think libs would be on board, with 100% of Americans on Uncle Sams paycheck, but then again.....

SBK
09-14-2005, 01:11 PM
Nice idea, but it will never happen.

1)IRS too protective of their turf.
2)Lobbying from Corporate interests, as there will be no loopholes to use to avoid paying their fair share.
3)Lobbying from an account/tax prep. industry that would find itself obsolete.

Find a way to deal with all the bribery....oh, I'm sorry, lobbying money, and the bill HR 25 might have the chance of a (frozen water) snowball in Oakland (the narcotic snowballs are readily available at the stadium).

Until then, a nice idea, but it's not realistic.

However, i've been wrong before.

If people would get behind something, and show congress that there is vast support for it, they just might get their wish. I do admit it's a steep, steep uphill climb though.