Kevin McCarthy’s fate on the line, House conservatives warn speaker’s election could take days

[Hoodat]

If you had ever taken the time to actually read the proposed legislation (HR25 in the last congress) you would know that is directly addressed in the legislation @Hoodat

OK, so help me understand.  Bill Gates buys a new yacht - not from a US yacht maker, but from one in Italy.  And he registers the yacht in the Bahamas, or Isle of Man, or some place like that.  Let's say he forks over around $400 million for it, and then pays $1 million per year to keep it staffed.  How does the US government get its money?

[roamer_1]

There is no way in hell I am signing on to a national sales tax while our government still has the authority to tax our incomes.

That's right - That's a sticky bit. Even if it starts out right, the thought that they could add income tax back in later is an uncomfortable reality.

And then there will be the creation of a new cottage industry for the super-wealthy that will specialize in the avoidance of hefty sales tax bills.  Yacht purchases and registrations will no longer occur in the US.  The same for private planes, etc.  Gulf Stream will have to move offshore in order to remain in business.

I don't know that's true. The wealthy will no longer be being taxed otherwise, so I don't know how that will shake out... Schedule C would be another concern... a worthy point.

[Hoodat]

That's right. I have always been a flat tax fan - Hands down! The only reservation I would have is in taxing groceries and medical/medicines... and maybe housing. Retail goods, no problem. But the ability to live... Taxing that is a bother. I know that sounds more like a luxury tax, but that is not what I mean to do... 

I still prefer a flat tax on income.  If it is good enough for G-d, it's good enough for me.

[Bigun]

The stakes are much much lower for those 45 states.  And it is State agents policing those things, not Federal agents.  We will end up with more tax agents than we have now.  Every current IRS agent will find a new job at BATF.  And that still won't be enough.

There would be no federal agents policing the federal sales tax I'm in favor of either @Hoodat Read the bill!

[Bigun]

I still prefer a flat tax on income.  If it is good enough for G-d, it's good enough for me.

When you can provide me with a definitive, immutable, not subject to change at every whim of congress, definition of the word "Income" we'll talk. 

[roamer_1]

I still prefer a flat tax on income.  If it is good enough for G-d, it's good enough for me.

There is some value in that - That everybody must crack a vein personally - That responsibility is more personal... skin in the game.

But it also is secondary to the economy. Uncle gets his vig no matter how you are doing... I like the idea that uncle gets his vig from the economic market directly and only - Because that makes it in Uncle's interest to keep the economy sailing, and it would make it damn hard for them to want to over tax and slow the economy down.

The balance becomes inevitable and self-sustaining.

[Bigun]

Read, watch, and learn!

https://fairtax.org/about/how-fairtax-works

[Hoodat]

Read, watch, and learn!

https://fairtax.org/about/how-fairtax-works

Will do.  In the meantime, how does the yacht scenario fit into the picture?  Or the guy smuggling Canadian whiskey into the US?  Or Turkish cigarettes?

[roamer_1]

Will do.  In the meantime, how does the yacht scenario fit into the picture?  Or the guy smuggling Canadian whiskey into the US?  Or Turkish cigarettes?

D00d. smugglers don't pay tax. That's all part of the cash economy. That's the point of smuggling... To avoid the tax.

[Bigun]

Will do.  In the meantime, how does the yacht scenario fit into the picture?  Or the guy smuggling Canadian whiskey into the US?  Or Turkish cigarettes?

Read the three papers at the link below.

https://fairtax.org/research-library/evasion

[Hoodat]

OK, reading the details.  First of all, 23% is way too high.  Second of all, the prebate is bullshit.  We would effectively be subsidizing anyone who doesn't spend money.  That is a deal-breaker for me.

With a flat income tax, a person making $10k per year is vested because that person would owe tax on that income.  Under the sales tax proposal, a person spending $10k would be getting free money from the government.  A great big 'hell no' to that.

[Bigun]

D00d. smugglers don't pay tax. That's all part of the cash economy. That's the point of smuggling... To avoid the tax.

The guy down on the corner selling drugs to your kids doesn't go find an IRS agent at the end of the year either! But he does eat, drive fancy cars, wear spiffy duds...

[roamer_1]

The guy down on the corner selling drugs to your kids doesn't go find an IRS agent at the end of the year either! But he does eat, drive fancy cars, wear spiffy duds...

That's right.

[Bigun]

OK, reading the details.  First of all, 23% is way too high.  Second of all, the prebate is bullshit.  We would effectively be subsidizing anyone who doesn't spend money.  That is a deal-breaker for me.

With a flat income tax, a person making $10k per year is vested because that person would owe tax on that income.  Under the sales tax proposal, a person spending $10k would be getting free money from the government.  A great big 'hell no' to that.

Many papers available on the subject. I'm not going to reproduce them here.

https://fairtax.org/research-library/taxes-and-tax-reform

[Bigun]

K Street in Washington is filled with people who spend all of their time working to "refine" the definition of "INCOME"!

[Hoodat]

Read the three papers at the link below.

https://fairtax.org/research-library/evasion

Looking through the first one.  It repeats the claim that tax evasion will be lower, but it does nothing to explain how.

The gist of it is that a national sales tax will have ZERO effect on a yacht bought in Italy and registered in the Bahamas.  Meanwhile, a crew with a $1 million income would no longer be subject to income taxes for their labor.

As for the Canadian lumber smuggler, the only way you are going to catch him is by using BATF agents that will follow him in each State he visits.  No different from DEA agents tracking drug smugglers in every US State.

This is not the panacea that this site makes it out to be.  And 23% is way too high, considering that with the new subsidies, you still won't collect more than 19% of GDP.  I prefer a 17% flat income tax, and then force government to live within that.  No more free tax credit handouts from the IRS.

[Hoodat]

The guy down on the corner selling drugs to your kids doesn't go find an IRS agent at the end of the year either! But he does eat, drive fancy cars, wear spiffy duds...

The income used to purchase those drugs has already been taxed.

[DB]

OK, reading the details.  First of all, 23% is way too high.  Second of all, the prebate is bullshit.  We would effectively be subsidizing anyone who doesn't spend money.  That is a deal-breaker for me.

With a flat income tax, a person making $10k per year is vested because that person would owe tax on that income.  Under the sales tax proposal, a person spending $10k would be getting free money from the government.  A great big 'hell no' to that.

Any income tax is ripe for fraud and will be morphed into what it is now over time no matter how flat it starts out as.

A sales tax is the only way to limit the damage congress can do and reduce the huge burden of tax management on people and business.

[Hoodat]

Any income tax is ripe for fraud and will be morphed into what it is now over time no matter how flat it starts out as.

An employer has a built-in incentive for reporting income (i.e. it lowers tax liability).  There is no such incentive for anyone selling goods.

A sales tax is the only way to limit the damage congress can do and reduce the huge burden of tax management on people and business.

Sure, until they begin reducing the size of the incentive carrot they use to entice sellers to do something that benefits them negatively.   Or until they start increasing the subsidies paid out to "the poor".  Before long, 'the poor' will be getting their subsidy checks directly deposited into their bank accounts as they pay cash for 'goods' from their local street dealers.  No thanks.

[roamer_1]

An employer has a built-in incentive for reporting income (i.e. it lowers tax liability).  There is no such incentive for anyone selling goods.

The burdens of employment and the cost of employees caused me to quit trying on a large scale and is why I went back to sole prop.

All those burdens would be removed. You might get me to hire a dozen people again.

[Bigun]

Any income tax is ripe for fraud and will be morphed into what it is now over time no matter how flat it starts out as.

A sales tax is the only way to limit the damage congress can do and reduce the huge burden of tax management on people and business.

 

[Polly Ticks]

Maybe we should change the name of this thread to Flat Tax debate?

[Bigun]

Maybe we should change the name of this thread to Flat Tax debate?

Point well taken @Polly Ticks

[Kamaji]

Any income tax is ripe for fraud and will be morphed into what it is now over time no matter how flat it starts out as.

A sales tax is the only way to limit the damage congress can do and reduce the huge burden of tax management on people and business.

Sales tax is equally ripe for fraud.  Even a VAT, which has a lot more robustness than a retail sales tax when it comes to providing the means to catch fraud, is still subject to substantial fraud.

And sales tax audits make income tax audits look like the epitome of accuracy and correctness.

[Hoodat]

Maybe we should change the name of this thread to Flat Tax debate?

A correction is in order.  Here goes:


Kevin McCarthy sucks!


Are we back on point now?