gfn wrote in
:

On May 26, 6:09*pm, RD Sandman wrote:
gfn wrote
innews:5e36036b-9c38-4449-8578-93cd47cf929f@
v8g2000yqb.googlegroups.com:

On May 26, 1:05*pm, RD Sandman
wrote:
gfn wrote
innews:6b95e91a-138f-49b0-a7bd-e8e44a57e311@
e35g2000yqc.googlegroups.com:

On May 25, 5:42*pm, RD Sandman
wrote:
gfn wrote
innews:7c91830c-c968-4f08-9c9e-77bc0350d428@
y19g2000yqk.googlegroups.com:

Sure I do. *The "flat tax" has the government deriving its
revenue from the income tax.

Yep....at a flat rate for everybody.

As does the FairTax. *Best part is the consumer pays it only
when the
y
buy something. *They decide when to pay it, not when the
governmen
t
decides you owe it on payday.

It looks like they are trying to mix sales tax with the old
luxury tax.

The FairTax is effectively a replacement of the compliance costs
that are already built in to every product and service you buy.

Not quite since those compliance costs are not the same revenue
source as the income tax. *For your Fair Tax to work, that revenue
source from income needs to be added.....so it isn't simply the
'before' costs added to the price of purchase.

No it doesn’t need to be added.

Of course it does. *It is NOT part of that 23% you keep saying is
alrea
dy
paid in product cost or the product taxes, etc. were actually less
than 23%. *What you have is this:

Product selling price
Product cost
Corporate taxes
Inventory taxes
Excise taxes

Now subtract the bottom three from the product selling price.

Now you have:

Product selling price
Product cost
- Corporate taxes
- Inventory taxes
- Excise taxes

Now add those to a Fair Tax

Corporate taxes
Inventory taxes
Excise taxes

Now you need to add in the tax portion that was covered by federal
income taxes. *You now have:

Corporate taxes
Inventory taxes
Excise taxes
The revenue from income taxes
Revenue from FICA

You can't subract 23% from a product, add more stuff to it and add it
back and still have 23%.

* It’s already part of what you are

paying anyway. *Here’s a very simplified example:

Product costs $100, broken down as follows:

Under current system
- * * wholesale = $50
- * * compliance costs = $23
- * * sales and other taxes = $27
- * * Grand total = $100

Under the FairTax
- * * wholesale = $50
- * * compliance costs = - $23
- * * FairTax = $23
- * * sales and other taxes = $27
- * * Grand total = $100

Ooops, forgot the revenue to make up for no income tax and FICA.


The FairTax replaces federal income taxes including personal, estate,
gift, capital gains, alternative minimum, Social Security, Medicare,
self-employment, and corporate taxes. 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. I can't make it any more simple than
this.

And I already know that. Tell me something new like how you subtract 23%
from product costs, add it back in and then add personal income taxes,
estate taxes, gift taxes, capital gains taxes, althernative minimum
taxes, FICA, Medicare Taxes, self employment taxes, corporate taxes and
compliance costs. So how can you end up with the same number?

Either the original 23% you take out is wrong or the 23% you put back in
is wrong.

Economists and businesspeople have spent $22M researching
this. There is nothing more I can tell you to convince you. You need
to read the book and the web site.

Me reading the book or the website won't change that what you are saying
doesn't compute.

* The luxury

tax would have been a tax on top of that.

And to cover the loss of revenue from the income tax being
removed, it is also added into that Fair Tax number.

No, not added to the FairTax number. *The FairTax IS the
replacement to the income tax.

Not if the other taxes were already 23%. *You can't put ten pounds of
crap in a five pound bag.


See above.

Not an explanation, not was your previous comment.

The FairTax is related because it is a flat sales

tax that generates revenue from sales. *It replaces the
income tax as the method of funding government. *If you
full
y
understand the FairTax
you will see exactly where I am coming from.

Then to keep it from becoming regressive you must drop that
sales tax from certain items, like food, housing, public
transportation, gasoline, etc.. or you end up with the poor
paying a much larger percentage of their income on those
taxes than the wealthy.

Nope, There are two reasons why it's not regressive. *First,
peopl
e
pay no net FairTax at all up to the poverty level.

Which means that someone, somewhere needs to know your income.

*Every household

No, they just need to know how many people are in your
household. That determines the prebate, not one's income.

How do you you receive that prebate? *Do you get a check every
month
?

That, or direct deposit to your bank account. *The infrastructure
is already set to do this for any number of government programs so
implementation is not difficult. *Well, we are talking government
her
e
so….

OK

receives a rebate that is equal to the FairTax paid on
essential goods and services.

I looked at the prebate schedule. *Where in there does income
com
e
into it for that poverty level? *

It doesn't. *Nor does it need to. *It only needs to figure what
the
cost of essential goods and services are for a family of X
number of people. *A family of four that makes $100,000 requires
the same essential goods and services as a family of four that
makes $50,000.

And how is that prebate received?

See above.

From what I see, it is based on number of
adults and number of dependents.

Correct, that's all that is needed.

*Second, per my example an item that costs $100 today still
cost
s
$100
*under the FairTax.

* If that's regressive then sign me

up.
The poor are always going to pay a larger percentage of their
income on everything. *No tax system is going to change that.
*Isn't that what the bulk of this thread is about?

Not on a flat tax like I proposed. *The difference is slight,
depending on your income, but it is there.

Not sure I follow. *If taxpayer A makes less than taxpayer B,
assumin
g
both buy the exact same thing then taxpayer A is always going to
pay more of a percentage of their income for buying something.

My flat income tax proposal is on income not goods.

And under that system you are taxed on what you earn AND what you
spend. *Under the FairTax you are taxed ONLY on what you spend.

Wrong. *Under the flat tax system, you are taxed separately on what
you earn and what you spend. *With Fair Tax, you are taxed on what
everyone earns and the product costs but it is all in one tax in lieu
of being separate.


Uh… okay. Mince words if you want. The reality is under a flat tax
you are still paying twice. And, you are paying 23% in embedded
wasted costs. Under the FairTax you are paying once. What I'm
hearing you say is that you would still rather be taxed two separate
times as well as having your income taken from you when the government
wants it as opposed to when you want to give it to them, continue to
comply with a messy tax code and on and on and on. If that's what you
want then there will never be any convincing you otherwise.

No, what you are really hearing me say is that you cannot remove 23% from
a product cost, add it back in, add a bunch of stuff and end up with the
same number. Either you take out a different percentage than 23% or you
add in a different percentage than 23%. Which is it? All you have
really removed from the cost of the product is compliance costs for the
old system. You also added compliance costs for the new Fair Tax and all
those other taxes aforementioned. You cannot convine me that all those
taxes are the same value as the old compliance costs.

The FairTax is a replacement

for the income tax.

Yes....and a flat tax is another method of figuring
income tax.

Yeah....and they both accomplish the same thing. *The
FairTa
x
i
s
better because a flat tax still involves taxing income
which then leads to exemptions, deductions, and keeps the
16th amendment in place as well as the IRS, and I can go
on and on about the pitfalls of our current tax system.

A flat tax on income replaces the current tax system. *If
properl
y
administered it only has ONE deduction and that is poverty
level wages for a family of four. *Everyone gets that ONE
deduction, or exemption if
you prefer, and no other. *You can do your tax on a
postcard.

Under the FairTax you don't have to worry about deductions or
exemptions. *You don't even have to do your taxes on a
postcard because there is nothing to do. *April 15 would be
just another beautiful spring day.

Here's the problem with the flat tax, it retains the invasive
income tax administration apparatus and can easily revert to
a graduated, convoluted mess, as it has many times over many
years.

And your fair tax needs to know number of adults in the
household along with number of dependents. *

Correct. *Again as it should. *That's how the prebate is determi
ned
.

And how is that prebate handled? *There is really nothing in the
propos
al
that indicates that.

From the FAQ: All valid Social Security cardholders who are U.S.
residents receive a monthly prebate equivalent to the FairTax paid
on essential goods and services, also known as the poverty level
expenditures. The prebate is paid in advance, in equal installments
each month.

Read that. *I was asking how and you seem to have answered that
earlier when you said it could be in the form of a check or a deposit
to one's account.

*The size of the prebate is determined by the Department of

Health & Human Services’ poverty level guideline multiplied by the
ta
x
rate. This is a well-accepted, long-used poverty-level calculation
that includes food, clothing, shelter, transportation, medical
care, etc.

Yes, I know what is in it.

Sent via check or direct deposit.

You answered that earlier. *My point was that the FAQ doesn't say
that.
*
It says you get it but not how.


The web site doesn't, the law does.

YOu already told me. Why waste time repeating it?

The Fair Tax Act of 2005, Part XIX

`SEC. 304. REBATE MECHANISM.
...

`(c) When Rebates Mailed- Rebates shall be mailed on or before the
first business day of the month for which the rebate is being
provided.

`(d) Smartcards and Direct Electronic Deposit Permissible- The Social
Security Administration may provide rebates in the form of smartcards
that carry cash balances in their memory for use in making purchases
at retail establishments or by direct electronic deposit.

So each registered family (or family of one perhaps) will get their
rebate checks in the mail, via direct deposit, or via a smartcard/
debit card account arrangement. I would probably use direct deposit
myself. Paper checks are slow, and I think a separate debit card from
my regular check card is not very convenient (just another card to
have to safeguard and another account to watch).


Oh, and with regard to the first paragraph if you aren’t legal you
don’t get the prebate, but you still pay the tax. *Think illegals.

I already figured that out.

Or, how about the drug dealer who pays no income tax at all on his
“earnings”. *The government currently get no, zero, nada, zilch,
income tax from him. *But, does Joe Criminal buy nice cars,
clothes, electronics, houses, etc? *Guess what? *Now he’s paying
the FairT
ax on
that. *How about the tourist who comes to the US for a pleasure
trip? Does the government get any income tax from them? *Nope. *Do
they b
uy
a lot of goodies while here? *Yup. *Get the picture now?

I already had the picture. *I was asking details.

There is also nothing there that prevents it
from becoming another convoluted mess. *Congress can **** up a
bowling ball.

Yes, congress can **** up a bowling ball. *In fact, the first
implementation of our current tax system was just a handful of
progressive tax brackets (several flat taxes if you will),

Prograssive tax brackets do not a flat tax make.

No they don’t, but my point still stands. *Look what has happened t
o
those brackets since 1913.

And with Congress, there is nothing stopping that from happening
again in one form or another with the Fair Tax.


I agree, but as I described it's much harder to do than with an income
tax.

Only because you are relying on congressional folks greed. Not a good
thing to count on.

*with no

exemptions, no deductions, etc. *And look what happened. *There
is
no
reason to believe a flat tax would wind up going back to the
convoluted mess we have now.

I think you meant to say "wouldn't". *Anyway, there is no reason
to believe that a Fair Tax wouldn't either.

Yes, you are correct. *Agreed, but the reasons I laid out make it
far harder to do than the current tax code or even the flat tax
which still would have all the nonsense that goes along with our
current code.

Why would it be harder? *All Congress has to do is to modify the
code.


Really? That's all they have to do? You make it sound so easy. As I
already said everybody…I repeat…everybody pays this tax. No
exemptions, no deductions. Everyone pays it. Now, you tell me what
politician in his right mind is going to risk election or re-election
by raising the rate.

Same ones that are going to have to address entitlements before we go
broke.

If they do they are a one term rep or senator.
I'm not saying it's impossible, but it is much harder.

Not really......just a bit more open....maybe.

Take the current state of affairs. Obama and the leftwing
redistributionists are all in favor of raising taxes on the so called
rich. They are at no real risk of trying to do that because a) the
"rich" are a small percentage of the voting base that actually pay fed
income taxes; and b) their (Obama and the rest of the left) voting
base is predominantly a group that pays little to no fed income tax.
So, if you are a voter asked to vote for someone who will raise taxes
on someone else who the hell are you going to vote for?!?!?
Conversely, if that same politician says they are going to raise taxes
on YOU who do you think they are going to vote for.

That's a good point, but in this case, those taxes will be going up or we
will be going broke.

* Plus, you would still have a tax code,

the IRS, the 16th Amendment, compliance costs, and on and on and
on. Under the FairTax the tax code – gone, IRS – gone, 16th
Amendment
–
gone, compliance costs – gone.

That said, congress can raise the FairTax rate just as it could
raise the flat tax rate or can and does raise the income tax
rate. *The current income tax is effectively hidden.

So are the costs contained in the Fair Tax. *I saw no provision
for showing them.

The costs contained in the FariTax are just a replacement for
income taxes. *That’s the whole point.

I don't think you get the whole point. *At least not in your
examples.
*
You cannot subract a percentage from a cost, add things to it and put
it back in place at the same percentage. *

* It's just taken every

paycheck and I bet 99% of workers don't even know how much is
being taken out every week. *Out of sight out of mind.

That would effectively *be the same with the Fair Tax. *You would
hav
e it
taken out on every purchase but no indication of what all was in
it in what amounts.

The receipt would have a line item that states “FairTax: 23%” with
the
applicable dollar amount. *Better yet, you only have to look at
that line item when you make a purchase. *And, you only have to
look at that line item when you purchase a new item. *Buy a used
car? *No FairTax. *Used bike? *No FairTax.

One reason is that most used stuff is purchased directly from the
seller.
*
There is no one who in the middle to act as a collection point for
that tax. *Not a lot of used stuff is taxed on sale in the current
market.


Used stuff is not taxed under the FairTax because it has already been
taxed once already. It's unfair to tax it again.

I would bet that it is simply that there is no real way to collect it
since it is not through a retailer.

The tax collector
for new stuff is the same entity that it is now, the seller.

No, it isn't. There is a difference between a seller (who can your
neighbor in a yard sale) and Sears who is a retailer.


* They just accept

that government takes it.

Same with your sales tax.

Sure, we’re all hostage to what the government shovels on us. *But,
again, you pay income tax no matter what. *You have no choice. *Wit
h
the FairTax you have a choice.

Not if you wish to purchase anything in other than the used market.


You have the choice to purchase. It's only then that you pay the
tax. Wouldn't you rather have that choice than no choice to be taxed
on your income? I mean, really, I just don't get the line of
reasoning otherwise.

The bottom line is that folks will purchase where they think they get the
best deal. Will the added tax make a difference? Most likely if it is
23%. Hell, people squawk now about a 10% sales tax and your Fair Tax
only replaces the federal portion of that tax....not all of it.

*And, to the extent that you need to

buy necessities of life you get the prebate.

But still pay the tax on those items at time of purchase.


So? That's the purpose of the prebate. You effectively pay no sales
tax on necessities.

You effectively pay no *federal* tax on necessities. You still pay state
and local sales taxes. So now your product will cost:

Product cost
Compliance costs
Profits along the way
State and city taxes
Fair tax.

The first three remain about the same.

* Purposely designed that way by government.

The FairTax is highly visible (displayed on your receipt) and
there is only one tax rate.

That isn't the problem. *Taxpayers DO know what is in their income
tax.
**

I couldn’t disagree more. *Go ahead and ask the next person you see
that you know how much was withheld from their last paycheck. *Bet
they don’t know.

Bet they do when they fill out their taxes. *Those who use CPAs are
sma
rt
enough to have a good idea what is in the taxes and those who don't,
wouldn't know anyway.


You just described another reason for the FairTax. Actually two
reasons. First, under the current, or flat, tax you still have to
file. Not so with the FairTax.

I still have to file state taxes which if I am not doing federal taxes
will have to be done from scratch so state tax preparation will be more
costly and take longer. The IRS still needs to send out all the forms
like 1099s, W2s, etc.. The IRS still needs to track all state and local
taxes although not for federal tax purposes but to establish poverty
level wages, etc.


Then those who use CPA's have
to…well… use CPA's to figure out the tax burden. Wouldn't you rather
a) not have to file anything;

Fair Tax still only applies to federal taxes...not all taxes.

and b) spend the money you just spent on
a CPA on something else ore productive…like a good round of golf on
April 15 instead of working on your taxes :-)

And go to prison for tax evasion on your state income taxes because you
were in the clubhouse celebrating?

They do not know what portion of that Fair Tax is the replacement
for income tax, what portion is corporate taxes, what portion is
government taxes for whatever purpose when Congress changes the
percentage of the Fair Tax.

So what? *What they do know is that the FairTax replaces the income
tax. *They no longer have to file. *They no longer have to keep
records, see accountants, worry about deductions, exemptions,
audits and so on. *Instead, all they do is buy a product and that’s
it.

*Changing that will be harder for congress to do.

Why? *Because the FairTax affects EVERYBODY. *The income tax doe
s
not. *Right now, almost 50% of workers pay no federal income
tax.

The only folks who would pay no federal income tax under my
proposal would be those who income was below the federally
declared poverty line for a family of four and EVERYBODY gets that
one and only deduction.

Fine. *You still have in place the 16th Amendment, the IRS,
compliance, record keeping, accountants, fear of audits. *Then you
have people that pay no income taxes, as I already mentioned, such
as criminals, tourists, illegals, those paid in cash.

And with the fair tax, you have the used market, the under the table
market and swapping.


And that's not happening now?

You don't think an open 23% sales tax on goods won't increase that?

How about the criminals who deal in
such underground markets? What are they paying in income taxes now?
But, do they still buy goods and services?


It's easy for them to say raise taxes on the top 50% that
actually pay.

No, it isn't or Obama would have done it in lieu of extending the
Bush taxcuts.

Have you seen the most recent tax stats?

Are you insane? *Who do you think has been posting the numbers in
here?


Well, actually, I did in one of my responses to John Smith.

The tax burdens by AGI and percentage, who owns the wealth and who owns
the income came from me.


*Nearly 50% of wage earners

pay nothing in federal income taxes. *That’s the highest it has eve
r
been since the implementation of the income tax.

The actual percentage, just for your input, is 45%. *The bottom 50%
pay
s
just under 3%.


I know what the percentage is which is why I said "nearly". If you
want to get in a ****ing contest over 2.7% that's fine, but my point
still stands and is correct.


* This class warfare

thing is in all out mode…and it’s working.

Yep......but you will always have that with Democrats. * When they
get into power, they will mess around with your Fair Tax also.


As I repeatedly said, let them try it. I recall some dumbass who once
ran for president who said "if elected I will raise your taxes".
How'd that one work out for him?

If he was a dumbass, I doubt that one comment is what did him in.

* Raising the FairTax means raising it on them too. *Good luck to

any politician trying that.

As does raising the income tax percentages or do you think
politicians make less than the poverty level? *

No, but I say again, *you still have in place the 16th Amendment,
the IRS, compliance, record keeping, accountants, fear of audits.
*Then you have people that pay no income taxes, as I already
mentioned, such as criminals, tourists, illegals, those paid in
cash.

*In addition, a

large part of the burden of the flat tax -- the business tax
-- will remain hidden from people in the retail price of
goods and services.

This is an interesting point since there are supposedly
intelligent folks in this newsgroup that don't understand that
all businesses end up passing all their costs to the consumer
in the price of the product or service. *If they don't, after
awhile the
y
go under.

Under a flat tax, individuals would still file an income tax
return each year. *Postcard or not, it's still a return.
While this is a simple postcard, the record keeping
requirement is still there. Under the FairTax, individuals
never file a tax return again, ever!

Federally, that could be true, however, when looking at state
and local taxes, it is bull****.

Not could be…would be. *There would be no federal filing.

Which isn't done with state and local taxes anyway. *They
currently get used as a deduction on federal income tax, but even
though there is no federal income tax, they still need to do state
taxes. *All they have saved is entering a number.

But, they are still filing federal forms and worrying about
deductions. *Why bother doing that when all you have to do is…
well….nothing! *Well, except buy a good or service. *And even the
n you
don’t have to file anything and no concerns about deductions.

*But, to

your larger point, the FairTax is a replacement to the federal
income tax, not state income taxes.

Which is what I said.

*Federal taxes are what is at issue

here. *So, what would you rather do on 4/15? *File federal, stat
e a
nd
local tax forms; or just a state and local?

When I do my federal taxes, TurboTax, for example, also does my
state taxes. *The extra time for the state tax is about 5 minutes.

Thanks for making another case for the FairTax. *You said "When you
d
o
your federal taxes". *How about implement the FairTax and not do
them at all? * I know I'd rather just have to worry about doing my
state and local taxes.

I wish to control my taxes as much as I can. *Don't you?


Do you control the government taking money out of your check every
other week? Do you control the fact that you have to file on 4/15?

I control the amount I pay within the law.

As for me here's how I would utilize my control. If I don't want a
good or service I won't buy it. There's my control. That's all I
have to worry about. And, I can do what many people have done and
move to a no income tax state like FL and the like.

I lived in Florida for several years. No state income tax shows up in a
few areas and not always to the good.

How much did TurboTax cost you? *$50, $60 maybe? *Wouldn’t it hav
e
been nice to spend that $$$ on something else rather than complying
with the federal tax code?

I wasn't worried about complying with the federal tax code. *I was
simply
interested in paying my share of the tax burden, but no more than
that.


Maybe you weren't but many companies are which is a big reason why
there is an embedded 23% cost in every item you buy.

Two problems.....one, that hidden cost probably isn't 23% (or if you
think it is post your cite) and companies pass on all costs that they
have to pay. They cannot do it any other way and still maintain as low a
product cost as they can and make a profit. Companies still pay taxes to
the letter of the law. What they do is the same thing I do, and, I
assume, you do....go through your taxes to ensure that you are complying
with the law and not paying anymore than you have to.

Still, the end
effect is still the same. You spent $X on a tax program or CPA. You
can pay your "fair share", whatever that means,

That means what the law requires me to pay.

when you buy goods and
services. If you aren't sure what fair share is and just want to be
sure then you can do more by buying more goods and services. Not only
do you fund the federal government, but you also help the economy.

Or I can simply send a check to the IRS. How often have you done that?

*Under

the flat tax, the payroll tax would be retained and income
tax withholding would still be with us.

Yep.

Under the FairTax, the payroll
tax, which is a larger and more regressive tax burden for
most Americans than is the income tax, is repealed.

No, actually, it isn't. *It is simply placed in the Fair Tax.

And once the FairTax is implemented none of that is withheld
from your paycheck. *

My point was that it was still there. *You just don't see it or
really know how much it is.

It is still there because the FairTax replaces it. *We’re not talki
ng
about doing away with government collecting revenue. *We’re talking
about the mechanism for how it is collected. *This is so much
simpler than the current system or even a one size fits all flat
tax.

Yep, but you need to take a closer look at how you present the
figures or learn more about them. *You cannot subtract x from y, add
z to x and ha
ve *
x be the same amount as it was before.

With the exception of state and/or local withholding you

keep 100% of your check. *So, the payroll tax that is now
effectively incorporated into the FairTax is paid by you only
when you buy a new good or service. *It's not automatically
withheld from your pay. *Y
OU
decide when to pay it. *Not the government. *So, where's the dow
nsi
de
to that?

Knwing what is in it and how much each entity is. *For example,
assume your percentage of 23%. *Now, certain corporate taxes get
changed. *Y
our
Fair Tax rate has to change to cover that. So now, this year it is
24.5%.
**
How does the consumer know which changed.....the income tax
portion, the corporate portion, the FICA portion, the whatever
portion?

I’ve already talked about changing the rate and how easy (or not
so) that would be. *Do you really think people care what has
changed?

Many will.


I suspect many more will care that they no longer have to file federal
taxes and keep their entire check (save state and local) while still
paying the exact same for items they buy every day.

No, they won't be paying the exact same for items they buy every day.

What they care is that an item that costs $100 under the current
system still costs $100 under the new system.

No, it won't. *Stop and think about why.


I have. That's why I (backed by $22M of research) like the FairTax.

Then explain it.

* And if they buy it

used, they don’t even care.

Under the FairTax, what

you earn is what you keep. No more withholding taxes; no more
income tax.

Just more taxes on the point of sale while all taxes from state
and local governments remains intact.

You are not accounting for the removal of the 23% built in costs
that YOU ARE ALREADY PAYING on every good and service that you
buy (that government doesn't even get, by the way – just wasted
dollars).

Yes, I am and it isn't 23% or the Fair Tax could not be 23% and
cover all those costs plus the amount currently from income taxes
or FICA. *

FWIW, all costs of doing business are placed in the price of the
product or service that is produced. *Anyone who doesn't
understand that won't understand either your Fair Tax or my flat
income tax proposal.

The 23% does account for it. *This tax plan is the most widely
researched tax plan in the history of the planet.

The 23% may account for it, but then it couldn't have been 23% when
it was first deducted.

* Economists and

businessmen smarter than me have examined it inside and out. *The
23% figure is the figure arrived at the make current government
receipts revenue neutral.

* When

those built in costs go away you are back to the same price.

Not really. *You have added additional taxes to that proposal in
the fo
rm
on income tax replacement and FICA and federal sales taxes which
were part of certain purchases.

Yeah, really. *What has been added replaces the compliance costs
that go away. *On average, it’s a wash.

Are you trying to tell us that the compliance costs are the same as
the entire income tax revenue? *That would be interesting since about
45% o
f
that federal revenue is individual income tax, 36% is payroll taxes,
12% is corporate taxes (which *you did put into your Fair Tax
number), 3% excise taxes and 4% from other.


I'm just telling you what the research says.

You haven't shown research that says you can deduct 23% in costs from a
product, add other costs in plus income tax, FICA, etc. and come up with
the same number.

You produced a comment that says research has shown that a 23% tax would
be revenue neutral, but I havent seen any comments that the costs would
remain neutral. That has only come from you in your examples.

*See my

previous example.
It uses a flat 23% as the revenue generator.

Call it what you will, the FairTax is a winner.

You may think so. I don't. I think it needs too many
adjustments so that it does not become regressive.

I don't think so, I know so. *Tell me how this is
regressive
?

snip......

Same taxpayer......buys $100 worth of groceries.....pays
$123 for them.

Stop right there. *That's incorrect. *Under the FairTax the $
100
*of
groceries will still cost $100. *There's no need to even go
any further with your example.

I was speaking of the actual worth of the product. *Yes, there
ar
e
business taxes, etc.. in there but one cannot generate a new
tax without adding to what is already there. *So a product
which toda
y
costs $100 plus city and state sales taxes will now cost the
difference between the 23% sales tax and the old taxes on the
product plus city and state sales taxes. *What you have done is
taken the taxes previously included the product price and moved
them into your Fair Tax in addition to the hit on that tax
replacing federal income taxes and FICA.

Nope. *The item that costs $100 today will still cost $100. *Her
e's
why. *The built in compliance costs are, on average, 23%.

Then where did you put the replacement for the income tax? *It has
t
o
b
e
there or the feds are missing a major, major part of their
revenue.

As I said, the income tax replaces the compliance costs that go
away. If you don’t have an income tax there is no income tax code
to comply with.

And I say your number is wrong. *Compliance costs are NOT equal to
45%
of
the entire federal budget. *Now, Social Security, Medicare and
Medicaid are about 40% and both are expected to increase in cost over
the next ten years. *Social Security by 70%. Medicare by 77% and
Medicaid by 99%.

Are you trying to say that compliance costs with our current system
is equal to SS, Medicare and Medicaid? *


Okay, you say the numbers are wrong. Economic research says
otherwise.

Then post that research. The research you have mentioned is that the
revenue is neutral. That is NOT the same as product costs yet you keep
posting product cost examples to show your point. My point is that one
of the two numbers you use is wrong. Either the original 23% (that would
be the one I would suspect) or the 23% for the Tax. Since the tax number
came from the research by the Fair Tax group and is slated to be revenue
neutral, I would assume that that number is probably correct. It is your
example of subtracting out 23%, removing some costs from it, adding a lot
more cost into it and putting it back in as 23% that is suspect.

I can't convince you otherwise. You go for the flat tax
or stay with the current system. Hope April 15 treats you well as you
spend money trying to figure out your tax bill.

*Take that

away and your $100 now costs $77 (which already include the
state and city taxes you mention). *Replace those compliance
costs with the FairTax and you are back to $100.

See above.

Rich guy, he eats the same, so he buys a $100 worth of
groceries...pays
*
$123 for them. *Which one spent the bigger percentage of
their incom
e
o
n
a necessity? *OK, let's fix it....we will not pay that tax
on groceries....oooops, you just generated an exception. *

Three suggestions for you to find out why as well as any
other questions you might have:

1) go visit fairtax.org and read it from front to back.
*Pay particular attention to the FAQ.

I have.

mmmmmmm okay....

2) Buy and read "The FairTax Book" by Linder and Boortz.

Why? *If they can't explain it on their website..........

Boortz and Linder didn't create the web site. *They are
advocates of the FairTax and have their own writing on this.
*You can fit a whole lot more into a book than you can a
website. *You really nee
d
to read the book. *You will not regret it.

3) Then buy and read "FairTax:The Truth: Answering the
Critics"

It will all become crystal clear.

I am familiar with sales tax schemes, they have been around
for years.
*
With exemptions, they become just as convoluted as the
current system. Excise luxury taxes were another attempt to
soak the rich as poor poeple would never buy luxury taxed
items. *How did that work out?

You may be familiar with sales tax schemes, but it's clear
you aren't familiar with the FairTax. *Instead of speculating
as yo
u
have done above why not go visit the site and base your
criticisms on the plan itself? *You will find that many of
the things you raised above are answered there.

Been there, read it.

Not all of it then because many of the questions you asked that
I'm replying to come right from the web site.

Look, I'm with you that a flat tax would be better than the
current system. *Problem is that it, as opposed to something
like the FairTax
,
leaves itself open to far more manipulation than the FairTax.
*The ta
x
code itself is evidence of just that.

Are you trying to say that Congress cannot **** with the Fair
Tax as much as they can **** with a flat tax? *I don't think
so.

That's exactly what I'm saying and I explained why above.

LOL!!

Laugh if you will. *I see that you won't be convinced.

I simply don't feel that you can subtract product costs with taxes,
add income tax revenue to that, put the product costs back in and
have the same number. *If you know how to do it, let me know.


Fair enough. You're a skeptic and I appreciate that. But, the
research is on the website and in the book.

The research on the website addresses revenue neutrality. It does not
address product cost other than to say prices should fall and then wages
may rise. It even states that the change will be subject to market
forces.....however, in your example, you keep using a constant number
that suspiciously just happens to equal the Fair Tax. As I noted before,
it is not the 23% Fair Tax number I am questioning it is the number you
use to subtract from product cost and try to show the total product cost
to be the same as before. That is what I don't believe and have stated
several times why.

At least you are willing
to debate this reasonably. I really do hope you read the book and
learn about it because there are things there that the web site or I
can't do justice to. As for myself, I am not against a flat tax. I
think it would be better than our current convoluted system. I just
happen to think there is a better system.

There may be.

It will be tough going
because repealing the 16th would be the single most largest transfer
of power from government to the people in the history of this
country.

Excuse me, but if there is no income tax, then the 16th Amendment becomes
as useless as tits on a boar hog just like the 3rd Amendment.

The tax code is nothing but a social engineering and vote
buying tool. That power is not easily given up. Then again, a couple
hundred years ago no one really gave a democratic republic much of a
chance either.



--
Sleep well tonight....RD (The Sandman)

Cremation......for those who think outside the box.