1,470 people who made more than $1 million in 2009 paid $0 in federal income tax.

[CuteOldGuy]

"You may say I'm a dreamer. But I'm not the only one."

[IIFFOFRDB]

Eventually these people will croak the host. Then they won't have anyone to leach off of. "Dennis Miller".

[Sexyeccentric1]

Originally Posted by Jackie S

I am not talking about a flat tax. Just make all income, regardless of the source, taxed at the same rate as W-2 income. That means, the bricklayer, the teacher, the doctor, and the CEO all are subject to the same rate.

Here is how it will work. Say a small business man makes about $400,000 a year. He will pay a 10% rate on the first 8500, a 15% rate on the the next up to 34,500, 25% from there to about 84,000, 28% from there to about 175,000, 33% from there to about 380,000 dollars. Above that is taxed at 35%.

So, Warren Buffet, George Clooney, Donald Trump, Katie Couric, and so on will be paying a full 35% on anything they make OVER $380,000, regardless of the source.

Ah ok, from what I am reading on several different sites is that this Fair Tax system is incredibly defective and actually worse than a flat tax plan.

Here is a snippet from one site that seems to be touting a No Tax Plan.. not sure that will work but below is a snippet;

The main defects in the FairTax plan are: No tax cuts (except for the estate tax cut and gift tax cut for the wealthy), cancellation of the home mortgage interest deduction, charging taxes on top of health care costs, increasing the number of tax collectors, taxing retirement savings twice, and making every day tax day.

Other than that, it's still needlessly complicated, does not eliminate state and local taxes, does not account for more than a trillion dollars of lost revenue via the estate and gift tax cuts for the wealthy - which will be made up by someone - most likely the middle class.

The FairTax authors claim the tax is voluntary. The fact is that there is no way to avoid paying the tax - you have to eat! - and all food is taxed under the FairTax. Using this logic our present system is also voluntary.
FairTax supporters claim that the bill would repeal of the 16th Amendment. However, all it does is repeal a few sections of the tax code. The bill only suggests that the 16th amendment to the United States Constitution should be repealed. To repeal the 16th Amendment would require a constitutional amendment, the approval of congress and approval by three-fourths of the states. Without the repeal of the 16th Amendment, nothing will prevent an income tax from being imposed again after the FairTax is in place.
Although the FairTax would eliminate individual income tax returns, the FairTax turns every business (from Ebay sellers to farmers markets, and up) into a tax collectors. Every business no matter how small and every Internet business will have to collect taxes for the federal government. Every doctor and lawyer will now have to charge sales tax. The bill does nothing to eliminate other taxes. The FairTax is on top of existing state sales taxes. That is on top of the sales tax and local taxes that many cities and counties. That is on top of gas taxes, cigarette taxes, alcohol taxes, and other sin taxes. In addition, there is no part of the bill that limits how high congress can increase the national sales tax.
A major deception is the tiny prebate that wouldn't even cover a month's worth of food, let alone huge energy costs, gas for heat, electricity, and health care. The idea that $187 a month will cover the tax on the basic needs of an average individual is the biggest pile of bullshit in this entire plan. Most people spend more than that just on gas for their car. That amount of money wouldn't cover an office visit to a doctor. The entire prebate thing is a lie.


Even worse, as a sales tax, the FairTax taxes everything you buy and every service you use so that every day is tax day!


Worst of all, it taxes money that you worked for and earned. Gifts, estates, and basically any welfare or free money that you didn't earn or work for is tax free. FairTax supporter will try to tell you that estates, capital gains, and gifts are not "loopholes" to this tax. They are undeniably new income to the person receiving it no matter who had the wealth before the receiver did. There's no taxation without respiration. These unfair major loopholes costs will the government $700 billion a year.


To top it all off the FairTax may only have a limited possible lifespan. Because only new goods are taxable, all land, all property, buildings, and all houses will eventually all be declared "used". Buildings, houses, and especially land, have extremely long useful lives. There is really no need to buy new land if you just keep passing it from one generation to the next tax-free. At some point all houses, buildings and land will be considered "used" and will never be taxed again. This will cause a huge drop in the revenue of the government and will force modification to make up for lost dollars.
To repeat what we said before. The fact is that the FairTax is an extreme burden for the poor. Because they have to spend 100 percent of what they make to survive, then they are literally in the 100% tax bracket because all of their earnings are taxed. The FairTax is a penalty for the middle-class because they spend 80 percent of what they make in consumption, they are taxed on 80 percent of their income so they are literally in the 80 percent tax bracket. The FairTax is a nuisance for the rich. Since they save and invest most of what they get, and can invest tax-free, and transfer wealth tax-free. They only spend 5 percent on consumption so they are taxed on only 5 percent of their income and are literally in the 5% tax bracket. That doesn't sound fair to me.
Most progressives and intellectuals see the FairTax as a smoke screen for cutting the estate tax, gift tax, and capital gains taxes. All the manipulation of the tax code without reform, without balancing the budget, or without cutting taxes equally, is a nothing more than a cleverly disguised trick to set the ignorant listeners of hate radio to do the bidding of a handful of greedy billionaires.
We think that the real issue isn't reforming the tax plan. The real issue is controlling spending. Many Democrats, Republicans, and Libertarians with real fiscal sense know this to be true. The root of the problem is that government wastes nearly all the money it gets and is allowed to borrow and tax for more. We need to have a balanced budget where no extra spending is allowed. People should not have to pay for government they don't need and don't use. People should get something of value for their money. People should not have to be at the mercy of billionaires who didn't earn their inherited money, and who do everything they can to manipulate politics to favor themselves and their financial interests - we need to get corporate interests out of government.


The purpose of government is simple. The founding fathers spelled it out in the Constitution as follows: We the People of the United States, in order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defense, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America. There is nothing here about helping the stock market, promoting business, giving tax breaks to foreigners, giving old money billionaires a free ride. There is nothing about offensive weapons or invading other countries - only defense. What it does include is a fair justice system, a common defense system, and a general welfare system - nothing else! - for the express purpose of the happiness and union of the American people.


FairTaxFraud.com

See also PDF report from a Tax Analyst: Tax Analyst Special Report


Ok so gonna do some more reading and research on this tomorrow been up late late.. and I will give more input on this then! Night all!

[JD Barleycorn]

How many of those millionaires are Obama supporters like Warren Buffet?


Seriously, how was this money earned? If someone worked hard and invested their money intelligently they may earn a million dollars in dividends on a yearly basis. This is money that has already had taxes paid on it.

[CuteOldGuy]

You need to read about the real FairTax, not that jumbled bullshit. None of that is accurate.

[Sexyeccentric1]

Originally Posted by CuteOldGuy

You need to read about the real FairTax, not that jumbled bullshit. None of that is accurate.

I am reading the PDF that the Tax Analyst Report shows..and says the following:

If the FairTax imposes a new 23 percent tax on goods
and services, it looks as if it is largely a wash. Their prices
will fall by 22 percent once all income taxes are abolished
and the FairTax will add about the same, so the final
consumer cost will be no higher than it is now, at least on
average.15 If this is true, however, it is hard to understand
why there needs to be a tax rebate to compensate for the
burden of the tax, since it appears as if there is no burden.
Of course, there is also the question of transition that
FairTax supporters gloss over. They assume that prices
will fall by 22 percent the day the FairTax takes effect.16
However, economists know that in practice, wages and
prices are fairly rigid.17 If they weren’t, we would never
have recessions, which occur mainly when the Federal
Reserve tightens monetary policy to control inflation. A
recession emerges precisely because wages and prices
don’t adjust downward either quickly or easily.18
Consider the Great Depression. Most economists now
believe that its fundamental cause was that the Federal
Reserve allowed the money supply to shrink by about
one-third between 1929 and 1933.19 This was a problem
because the general price level is fundamentally determined
by the money supply times its rate of turnover
(which economists call velocity). This will equal the
quantity of goods and services times their prices (which
is the GDP).

If the money supply suddenly shrinks like that, there
will necessarily be a glut of goods that people will have
insufficient money to buy in the aggregate. If prices
adjusted as easily as FairTax supporters assume, producers
and sellers would have just cut their prices by
one-third. Then prices would have been in equilibrium
relative to the money supply.

Sorry had to cut and paste out of the PDF format. Any way drinking my coffee and continuing to read it.

[nwarounder]

I've said it 3 or 4 times now and no answer from any Fair Tax supporter yet, but I'll try again in vain. The U.S. has no control over foreign countries and therefore could not make them collect taxes on our behalf. What would stop another country (probably Cananda since they are pissed over Keystone) from exempting taxes on purchases from Americans and shipping goods to us via FedEx? Also, many countries already have no or little tax basis for American purchases as an incentive for Americans to purchase luxury goods in their countries, the Fair Tax doesn't address this issue either.

[Laz]

Goods from foreign countries go through customs. The tax can be assesed there. That is why you have to fill out customs forms when entering the US.

[nwarounder]

Originally Posted by Laz

Goods from foreign countries go through customs. The tax can be assesed there. That is why you have to fill out customs forms when entering the US.

LOL, you are being silly. How is customs going to determine the price of a T-shirt, a pack of gum, condoms, art, jewelry, or the value of every single item in the world from every single company in the world and what price it was on the date I purchased it, then send me a bill for the taxes on it? The government would have no idea of what I paid for any item and the company or person (like an ebay seller) I bought it from is not obligated to tell them.

Keep in mind, FairTax.org has been asked this question since 1995, and has yet to provide a plausible answer either, other than to say, "It is unlikely that "shopping across the border" in Canada or Mexico will result in any cost savings to the consumer.".

[CuteOldGuy]

Ok, just for argument's sake, let's say that we had a considerable amount of cross-border shopping after the FairTax is implemented. I doubt it, but let's just say so. Duh. Tariffs. Just like we funded government for 150 years before the income tax.

I'll have more on the FairTax later, but you really should look at FairTax.org. Do you really think our income tax is superior to the FairTax? If you do, please explain.

[CJ7]

as long as the politicians spend their asses off, it doesnt make a turd in a sack how we are taxed

[CuteOldGuy]

CBJ7, I think you made half a point there, and it was a good half.

[nwarounder]

Originally Posted by CuteOldGuy

Ok, just for argument's sake, let's say that we had a considerable amount of cross-border shopping after the FairTax is implemented. I doubt it, but let's just say so. Duh. Tariffs. Just like we funded government for 150 years before the income tax.

I'll have more on the FairTax later, but you really should look at FairTax.org. Do you really think our income tax is superior to the FairTax? If you do, please explain.

I have looked at FairTax.org many times over the past years, and as I have said in a few other posts, I think the FairTax may, or at least has the possibility of being superior to a progressive income tax with deductions.

But, they do need to come up with a solution to this problem, and a few others, or it has the possibility of being a complete failure also. The problem with FairTax.org is that they refuse to address the issue. I'm not inclined to support an organization that claims to have something better, but does not answer any questions, or only answers the questions they want to answer. I can rely on the Dems and Repubs for that kind of mentality.

Tarrif, tax, whatever you want to call it, the government still does not have the ability to determine the cost of the item. If you are suggesting a tariff be placed on all T-shirts with a smiley face on them to be x.xx amount, and a seperate tariff be created for every item in the world, it would take millions of pages of documents to support those tariffs and no gov employee could comprehend. Then you would have the expenses involved of having customs open every single package, appraise all the items, code them into an acct system, repackage, issue a tax bill, collect the tax, and so on and so on. Personally, I don't think the government could do all that in an efficient manner to collect $1.73 on a $7.50 smiley face T-shirt.

And I'm not sure if all that would be constitutional either, I could see a right to privacy issue being raised very quickly.

[CuteOldGuy]

You're describing the income tax when you talk about incomprehensibility. However, since we levied tariffs and completely funded our government with tariffs for more than 150 years, I don't think its constitutionality is in question. But you never know. I think the tariff system could be made simpler, but I'm not totally convinced it's necessary.

I think the FairTax would be such a boon to our economy, foreign competition would be negligible. But let's implement the FairTax, and if it becomes a problem, it will be much easier to solve than reforming (for the nth time) our monstrous income tax system. Even if tariffs were needed, and even if they were complicated, they could not possibly be more complicated or unfair than our current income tax system.

And thank you for a thoughtful, reasoned response. That's unusual here.

[Laz]

Originally Posted by nwarounder

LOL, you are being silly. How is customs going to determine the price of a T-shirt, a pack of gum, condoms, art, jewelry, or the value of every single item in the world from every single company in the world and what price it was on the date I purchased it, then send me a bill for the taxes on it? The government would have no idea of what I paid for any item and the company or person (like an ebay seller) I bought it from is not obligated to tell them.

Keep in mind, FairTax.org has been asked this question since 1995, and has yet to provide a plausible answer either, other than to say, "It is unlikely that "shopping across the border" in Canada or Mexico will result in any cost savings to the consumer.".

Leave it up to the recipient to provide the documentation and pay the tax before the item clears customs. Yes there will be some fraud but not enough to matter.

That is just one option. I am sure there are other solutions that can also work. Bottom line this is not a barrier.