Fair Tax

[DragonStryk72]

If you're like my, then you're probably saying some along the lines of, "What's the Fair Tax?", and until a few days ago, I couldn't have told you, not until the February 11th edition of the Link (a free newspaper in Norfolk), did their election coverage for the primaries here in Virginia. Ron Paul was running with it listed on his economic platform. Well, at the same time, we had just received a new book release, titled: FairTax: The Truth Answering the Critics, by Neal Boortz.

Well, I like to read about anything that is both new and offers legitimate solutions, so I started reading. It was actually a very engaging read (I have already finished the book in its entirety, around my 40 hour work schedule, my girlfriend, and valentine's day), and I have come away from it seeing a plan that could actually work, and help our economy in enormous ways.

The current tax code is 76,000 pages long, and even the best of our accountants and economists, or even the IRS, to fully comprehend, and so numerous abuses of the tax code have resulted. Because of these codes, we currently have the 2nd highest business taxes in the world, so much in fact, that it is driving american businesses overseas. The FairTax would seek to be rid of that, by creating a federal consumption tax that would completely replace income tax, payroll tax, federal withholding tax, capital gains tax, and stop punishing for working hard and saving. We would receive 100% of our paychecks, and we would only be paying taxes on what we personally consume.No more IRS, no audits, no more tax forms. As well, illegals, and foreign tourists would also have to pay the tax, expanding the tax base.

It would also lower the price of goods, meaning that there would be little to no change in what you are paying now (The cost of items you buy now have already been marked up to pay off any tax that has been charged to the company, that's on top of the cost to manufacture and ship). It's not just the tax, it's the sheer efficiency that improves things. you would need the massive number of accountants to go over the books, nor would you be taxed for investing, or for saving money.

You can find out more about this on http://www.FairTax.org , but I definitely advise going out and getting a copy of the book for yourself. It really is some great stuff, and it is a change I think we desperately need in this country.

[Hobbit]

I have a signed copy of the first FairTax book and I've read both of them. It's a great plan to get rid of the oppressive tax system we have right now and eliminate the gaming of the system so many politicians do to pander to special interests.

[pegwinn]

Welcome to the fight Dragon. I have the original, not signed, heavilly highlighted and cross indexed. Have not read the new one yet.

I am glad that I won't be the only one ringing the bell.

[JohnDoe]

I have a signed copy of the first FairTax book and I've read both of them. It's a great plan to get rid of the oppressive tax system we have right now and eliminate the gaming of the system so many politicians do to pander to special interests.
I am at a disadvantage for having not read the books, so let me ask you hobbit or anyone really....

What in this fair tax plan stops Congress from spending these tax monies on pork or waste?

What keeps Congress from raising the RATE of the Fair Tax?

Who really benefits the most in our society by instituting this fair tax....at a glance from what is being writen, it appears that those that live on investment income would benefit the most by the fair tax, and i am not saying this is necessarily a bad thing....just noting it in case the book went over it and you know better than my speculation.

But off hand, i think that the Fair Tax is definately a worthy proposal for a comprehensive overhaul of our tax system, leaving the door opened for some tweaking....

jd

[pegwinn]

I am at a disadvantage for having not read the books, so let me ask you hobbit or anyone really.... The first book is available at my public library. You might check yours.

What in this fair tax plan stops Congress from spending these tax monies on pork or waste? Nothing at all. But, you still have the elimination of 76K pages of regulation.

What keeps Congress from raising the RATE of the Fair Tax? Same as above. If our need grows, the tax can grow. Just like the income tax only with less pages, less beurocracy.

Who really benefits the most in our society by instituting this fair tax....at a glance from what is being writen, it appears that those that live on investment income would benefit the most by the fair tax, and i am not saying this is necessarily a bad thing....just noting it in case the book went over it and you know better than my speculation. We all benefit by stripping the Congress of the power to reward or punish special interests via the tax code. We win by removing a huge .gov agency that has a history of bullying citizens. We win by everyone including criminals and tourists kicking in.

But off hand, i think that the Fair Tax is definately a worthy proposal for a comprehensive overhaul of our tax system, leaving the door opened for some tweaking.... What needs tweaking? That's what I am afraid of. Before it is signed into law, it needs to survive unaltered.

jd

Good questions.

[Hobbit]

I am at a disadvantage for having not read the books, so let me ask you hobbit or anyone really....

No problem. I'm all ears.


What in this fair tax plan stops Congress from spending these tax monies on pork or waste?

Absolutely nothing. This is a tax replacement plan, not a government spending plan. Most people who want the FairTax also think government spending should be cut, but we're trying to tackle one thing at a time. The hope, though, is that with a tax plan as transparent as the FairTax, the taxpayers will figure out how much they're actually paying and start looking into where it goes. The FairTax itself, though, is a tax replacement plan, and nothing more. It changes how the federal government collects money, not how it is spent.


What keeps Congress from raising the RATE of the Fair Tax?

Once again, absolutely nothing...except the transparency of the system. Right now, congress can easily raise taxes by only raising them on certain people (i.e. 'the rich'). Under the FairTax, everyone is taxed at the exact same rate, and all items that are taxed are taxed at the same rate, meaning any tax hike will result in an immediate and noticeable spike in prices, and will thus be harder for the politicians to get away with.


Who really benefits the most in our society by instituting this fair tax....at a glance from what is being writen, it appears that those that live on investment income would benefit the most by the fair tax, and i am not saying this is necessarily a bad thing....just noting it in case the book went over it and you know better than my speculation.

Really, everyone who doesn't game the current system for their own personal gain stands to gain a lot from the FairTax, but yes, it will cause a benefit to investors, since money will not be taxed until it is spent. I guess the easy way to put it is that those who benefit the most are the ones who save money and spend less than they make. Those who spend more than they make will actually be getting taxed more.


But off hand, i think that the Fair Tax is definately a worthy proposal for a comprehensive overhaul of our tax system, leaving the door opened for some tweaking....

jd

The door is always open for tweaking. H.R. 25 is as mutable as any other piece of legislation. It is not the FairTax, but rather a legal document which is, so to speak, a manifestation of the FairTax. Provided that the underlying principles of the FairTax remain intact, suggestions are always welcome.

Just to give you an example of the potential benefits, Barack Obama is currently proposing a $210 billion dollar economic stimulus, which really amounts to just giving taxpayers back the money the government stole in the first place, but let's assume his theory on stimulus actually works. $210 billion dollars is a lot. That's $700 per person being dumped into the economy. If you started at the birth of Christ and made $1 million a day, the Roman Empire would be 100 years dead before you had made $210 billion. But hold on a minute. Americans will spend an estimated $325 billion paying people to fill out their tax forms, not to mention the billions of man hours, a valuable resource, spent on this crap. Add to that the $12 trillion in American owned money sitting in off-shore accounts to dodge taxes, most of which would be back in the country within months if there were no tax issues, according to Alan Greenspan. If Obama's plan passed once a week, it would be April 2009 before that much money was put into it.

It's also worth noting that in April of 2040, the yearly interest on the national debt will surpass yearly tax revenue, and we owe much of that to our horrible tax system.

[DragonStryk72]

I am at a disadvantage for having not read the books, so let me ask you hobbit or anyone really....

What in this fair tax plan stops Congress from spending these tax monies on pork or waste?

What keeps Congress from raising the RATE of the Fair Tax?

Who really benefits the most in our society by instituting this fair tax....at a glance from what is being writen, it appears that those that live on investment income would benefit the most by the fair tax, and i am not saying this is necessarily a bad thing....just noting it in case the book went over it and you know better than my speculation.

But off hand, i think that the Fair Tax is definately a worthy proposal for a comprehensive overhaul of our tax system, leaving the door opened for some tweaking....

jd

Alright, aside from what's already been said, it would stimulate the economy to an insane degree. Right now, you are being punished by our government for the following:
1) working hard (the more money you make per year, the more you get hit for)

2) getting raises/promotions (and we have a lovely new tax bracket to go
with that corner office)

3) saving, and investing in businesses. (Also known as the capital gains tax)

this is why so many buisnesses are leaving. Under the Fairtax, you are only taxed for what you spend. 3M went overseas because, if it were simply not stuck with the tax codes here, it could make an extra $100-$200 million per year. Yeah, for $200 mil a year, I'd be willing to move to China.

As well, there is a prebate in place, which pays back a monthly amount equal to the the basic cost of necessities as determined by the poverty level. What does this mean? The poor essentially pay nothing, aside from what they spend beyond their necessities.

Getting rid of the taxes on businesses is important, because the fact is, do you really expect Wal-Mart to pay their taxes without passing the cost on to you? 22% of every single item you buy is just the embedded costs tacked on for the taxes the companies had to pay just to stock the item, this is on top of the regular manufacture and shipping of the item. Then you pay your 5-11% sales tax on top of that, which basically breaks you down about 25% of everything you buy going to paying taxes, that's before you go to H&R or Jackson Hewitt for your taxes. This applies as well to your car, your credit cards, your bank, your gas, everything, they are all dumping you with their taxes. The individual citizen is the only one in america who is actually paying taxes.

Converting to the Fair Tax would eliminate the 76k page tax code, the IRS, and replace it with one that is 113 pages long. Prices would only go up 1%, but you would get to keep all of your paycheck, and ditch all of the hassle of the current system. That sounds worth it to me.

As to the idea that businesses won't drop the price of goods, that's crap, they would have to, or they would go out of business, that's the beauty of competition.

This change though does come with the responsibility to uphold this change. Income Tax after all started out as a flat tax that applied only to the rich, and look at it now. This time though, we are prepared, we know what happens if we let rampant spending get the better of us, and we would have a much more personal stake in

[Mr. P]

In over 10 years of following the Fair Tax movement I have yet to discover anything negative about it.

This tax method would explode the economy, and give the "people" the power of government as intended.

[CockySOB]

But the Fair Tax will never stand a chance of being implemented as long as we have several cottage industries built around our current tax code. Sad, but true.

Personally, I'm a fan of the Far Tax, but I'm enough of a realist to know it ain't gonna happen.

[Mr. P]

But the Fair Tax will never stand a chance of being implemented as long as we have several cottage industries built around our current tax code. Sad, but true.

Personally, I'm a fan of the Far Tax, but I'm enough of a realist to know it ain't gonna happen.

I donno, cocky, folks have had their jobs phased-out before. With the massive benefit this tax system would make, I would find it hard to believe a few cottage industries could stop it once the people knew what it would mean.

[CockySOB]

I donno, cocky, folks have had their jobs phased-out before. With the massive benefit this tax system would make, I would find it hard to believe a few cottage industries could stop it once the people knew what it would mean.

One of those cottage industries happens to be our bloated State and Federal governments. And getting politicians to reduce the size of those governments will be nigh unto impossible.

And that's just the tip of hte iceberg, so to speak.

[Mr. P]

One of those cottage industries happens to be our bloated State and Federal governments. And getting politicians to reduce the size of those governments will be nigh unto impossible.

And that's just the tip of hte iceberg, so to speak.

Right! The politicians will never willingly let go of the monetary grip they have on the people. But IF the people see what could be, well, there are more of US than them. The outrage will be deafening, they'll melt like butter to save their jobs.

[CockySOB]

Right! The politicians will never willingly let go of the monetary grip they have on the people. But IF the people see what could be, well, there are more of US than them. The outrage will be deafening, they'll melt like butter to save their jobs.

Dunno, but I expect that if there is another revolution in America, it will be a tax-revolution, and it won't be pretty.

[Gaffer]

Right! The politicians will never willingly let go of the monetary grip they have on the people. But IF the people see what could be, well, there are more of US than them. The outrage will be deafening, they'll melt like butter to save their jobs.

It will take an outright uprising to get the politicians to listen to what the people want. It will take the same to get the bureaucrats out of their cushy government jobs.

[Dilloduck]

It will take an outright uprising to get the politicians to listen to what the people want. It will take the same to get the bureaucrats out of their cushy government jobs.

So far their plan is working--They get us to hate each other instead of them.

[Mr. P]

Dunno, but I expect that if there is another revolution in America, it will be a tax-revolution, and it won't be pretty.

No guns and stuff...just knowledge and facts. The knowledge that they can't keep on this way when there is a better, much more beneficial, way for ALL of us...else we say bye,bye and elect someone who wants to serve (what a concept) not control.

[Gaffer]

No guns and stuff...just knowledge and facts. The knowledge that they can't keep on this way when there is a better, much more beneficial, way for ALL of us...else we say bye,bye and elect someone who wants to serve (what a concept) not control.

Would be nice but it's not going to happen. We will get the same offering of assholes we are getting now. Appointed by their respective parties. The parties select and fund the candidates. The whole country has to come together in the elections and kick them all out. Won't happen because most of the country is too stupid or just don't care. For that reason an uprising won't work either. People won't leave their couch and miss American Idol to go out and change the government.

[CockySOB]

Gaffer, the populace is too complacent. The politicians pander to every special interest under the sun, and every member of those groups wants their piece of the government handouts. This is also why the beast (government) continues to grow - they "buy" the votes of the public at large.

[Little-Acorn]

The "Fair tax" will be anything but, once it's implemented while the present Income Tax is still in place. The combination of the two will simply boost overall tax rates higher than they already are.

Can you imagine any bill to eliminate the Income Tax, getting through Congress, any time in the last 50+ years? There have always been alternatives proposed... and none has EVER made it, except as an addition to the original tax structure there already is. Is there any reason to think the present "Fair Tax" will be any different? Aside from a politician's promise?

BTW, for all of you who were conscientious and have been socking a lot of money away in a savings account, or savings bonds, or some other kid of after-tax method of putting something away for a rainy day, above and beyond your 401K...

You paid Income Tax on all that money, at a fairly high rate, before you saved it. And once the "Fair Tax" law is passed (even if the Income Tax IS eliminated), you'll pay a nice hefty tax on that savings again, once you draw it out and start spending it.

Suckers.......... :eek:

[Mr. P]

It will take an outright uprising to get the politicians to listen to what the people want. It will take the same to get the bureaucrats out of their cushy government jobs.

I would have agreed a few yrs back, Gaffer, but for the first time ever a Presidential candidate publicly supported the Tax method. The times, they are a changin. :cheers2:

[Mr. P]

The "Fair tax" will be anything but, once it's implemented while the present Income Tax is still in place. The combination of the two will simply boost overall tax rates higher than they already are.

Can you imagine any bill to eliminate the Income Tax, getting through Congress, any time in the last 50+ years? There have always been alternatives proposed... and none has EVER made it, except as an addition to the original tax structure there already is. Is there any reason to think the present "Fair Tax" will be any different? Aside from a politician's promise?

BTW, for all of you who were conscientious and have been socking a lot of money away in a savings account, or savings bonds, or some other kid of after-tax method of putting something away for a rainy day, above and beyond your 401K...

You paid Income Tax on all that money, at a fairly high rate, before you saved it. And once the "Fair Tax" law is passed (even if the Income Tax IS eliminated), you'll pay a nice hefty tax on that savings again, once you draw it out and start spending it.

Suckers.......... :eek:

That first sentence tells me you have NO CLUE about this tax, LA.
For it to go into affect the current tax system MUST be abolished and that's part of the plan.

I don't think you know much about a 401K either..all my contributions were BEFORE tax.

[Hobbit]

The current language of H.R. 25 requires that the income tax die before it goes into effect, and there's talk of slaving it to the abolishment of the 16th amendment. The makers of the tax are way too dedicated to the idea to stand by while it's tacked onto income and payroll taxes. There would be blood in the streets if the politicians tried that.

As far as it 'never happening,' I want this to sink in for you really quick. In the majority of precincts in Georgia, it is nigh impossible to get elected if you do not actively support the FairTax, and there is an open movement to make sure that any politician of any political stripe is thrown out of office on election day if they oppose the FairTax. Oh, there's opposition, to be sure, but if it continues growing the way it has been, the opposition will be like a stack of glasses trying to stop a tank.

[Little-Acorn]

That first sentence tells me you have NO CLUE about this tax, LA.
For it to go into affect the current tax system MUST be abolished and that's part of the plan.
Will the 16th amendment be repealed?

Then the income tax will not be abolished.


I don't think you know much about a 401K either
I know quite a bit about them, actually.

..all my contributions were BEFORE tax.
Ditto. Which is why I said "above and beyond your 401K' and talked about savings instead.

[Mr. P]

Will the 16th amendment be repealed?

Then the income tax will not be abolished.


I know quite a bit about them, actually.

Ditto. Which is why I said "above and beyond your 401K' and talked about savings instead.


What about the 16th Amendment?

It is not the intention of this plan, or the desire of the American people, to end up with both a federal income tax and a federal sales tax. The objective is to ensure that one is replaced by the other, not added on top of the other. By repealing the 16th Amendment, we close the door on an income tax for generations to come.
I missed the saving part..skimmed right over it...but still, future savings will be free of double tax. Now they aren't. Now you pay when you earn then again when you spend them in the form of embedded tax...so this is a win for savings too.

http://www.fairtax.org/site/PageServer?pagename=about_faq

[pegwinn]

The "Fair tax" will be anything but, once it's implemented while the present Income Tax is still in place. The combination of the two will simply boost overall tax rates higher than they already are. LA, you have been listening to some really dumb people. Do yourself a favor and read the bill. You will see the prerequisites in writing.

Can you imagine any bill to eliminate the Income Tax, getting through Congress, any time in the last 50+ years? There have always been alternatives proposed... and none has EVER made it, except as an addition to the original tax structure there already is. Is there any reason to think the present "Fair Tax" will be any different? Aside from a politician's promise? While a large part of the USA is a bunch of illiterate couch potatos who routinely chant "Jerry, Jerry, Jerry".... as the latest kissin cousins make the rounds on reality TV... there is another group that is informed, and, finally, getting pissed off. It will happen. It's only a matter of time.

BTW, for all of you who were conscientious and have been socking a lot of money away in a savings account, or savings bonds, or some other kid of after-tax method of putting something away for a rainy day, above and beyond your 401K...

You paid Income Tax on all that money, at a fairly high rate, before you saved it. And once the "Fair Tax" law is passed (even if the Income Tax IS eliminated), you'll pay a nice hefty tax on that savings again, once you draw it out and start spending it. What's your point? IF you take the money out now, and spend it, you will pay the same rate. The difference is that the fairtax "unhides" all the add ons as the product goes thru the pipeline from pipe-dream to the consumer and puts it as a line item on your receipt.

Suckers.......... :eek: You bought the propaganda without doing your homework, and you call us names....... sheesh

Seriously dude. I am not going to be able to talk you into it if you have already made up your mind based on one side of the story. Do the research, read the material, then come on back...... we'll leave the light on. :salute:

[Immanuel]

Will the 16th amendment be repealed?

Then the income tax will not be abolished.


If I remember what I read about H.R. 25, if it were passed, it does not take affect until the 16th Amendment is repealed. I'd have to go back and check that, but that was my understanding.

Immie

[pegwinn]

If I remember what I read about H.R. 25, if it were passed, it does not take affect until the 16th Amendment is repealed. I'd have to go back and check that, but that was my understanding.

Immie

Essentially correct:


Could we end up with both the FairTax and an income tax?

No current supporter of the FairTax would support the FairTax unless the entire income tax is repealed. Moreover, concurrent with the repeal of the income tax, a constitutional amendment repealing the 16th Amendment and prohibiting an income tax will be pushed through Congress for ratification by the states (filed as HJR 16 in the 110th Congress).

From the FAQ at Fairtax.org
(http://www.fairtax.org/site/PageServer?pagename=about_faq_answers#42)

The actual bill is here (http://thomas.loc.gov/cgi-bin/query/z?c108:H.R.25:).
HJR 16 Mentioned in the FAQ is here (http://thomas.loc.gov/cgi-bin/query/z?c110:H.J.RES.16.IH:).

[DragonStryk72]

The "Fair tax" will be anything but, once it's implemented while the present Income Tax is still in place. The combination of the two will simply boost overall tax rates higher than they already are.

Can you imagine any bill to eliminate the Income Tax, getting through Congress, any time in the last 50+ years? There have always been alternatives proposed... and none has EVER made it, except as an addition to the original tax structure there already is. Is there any reason to think the present "Fair Tax" will be any different? Aside from a politician's promise?

BTW, for all of you who were conscientious and have been socking a lot of money away in a savings account, or savings bonds, or some other kid of after-tax method of putting something away for a rainy day, above and beyond your 401K...

You paid Income Tax on all that money, at a fairly high rate, before you saved it. And once the "Fair Tax" law is passed (even if the Income Tax IS eliminated), you'll pay a nice hefty tax on that savings again, once you draw it out and start spending it.

Suckers.......... :eek:

Um, you realize that with no capital gains tax, that, no you wouldn't get taxed on any of that at all, right? As well, the FairTax is ONLY being put in as replacement, not as an amending of the current. Again, I advise you to *read* up on the FairTax, before your next post, or ask question, I'll be happy to answer them for you.

[Psychoblues]

Even the Bible intimates fair as being according to ability. Just what is your intimation or observation of "fairness"?

[DragonStryk72]

Even the Bible intimates fair as being according to ability. Just what is your intimation or observation of "fairness"?

What part of this is hanging you up, the "it would apply to all equally" part, or the "You would only be taxed on what you use after necessities" part?

[pegwinn]

Even the Bible intimates fair as being according to ability. Just what is your intimation or observation of "fairness"?

Now that you have tried and failed to get a rise out of folks........

Did you have an argument for, against, or a question? We are here to help. :coffee: