Author Topic: Kevin McCarthy Introduces “Fair Tax” Which Would Abolish Federal Income Tax  (Read 1525 times)

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Online Bigun

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It's a common European system. They call it VAT (Value Added Tax).
The best part is everybody pays, no matter how wealthy. And the tax is included in the price. If the stickers says $5, then you pay $5. Unlike the American system today in which the sticker price has no relevance to how much you will actually pay.

BTW: This confuses the hell out of foreigners who think it is insanity.

Exactly the same here except for the fact that it doesn't show up on your sales receipt.

The corporate income tax is a subtraction method VAT in function and consumers pay every cent when the buy anything made in this country.
« Last Edit: January 20, 2023, 03:11:38 pm by Bigun »
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Offline Weird Tolkienish Figure

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I'd love for this to happen, along with repealing 16th and 17th but it will probably never happen. We love government in this country too much. We just do.

Online Bigun

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I'd love for this to happen, along with repealing 16th and 17th but it will probably never happen. We love government in this country too much. We just do.

We have been conditioned that way for a LONG time now but that does not mean it took everybody in.

If it were up to me, tomorrow morning the Federal Government would be less than one third its current size.
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Offline DefiantMassRINO

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The Feds will KEEP the income tax AND implement a new National Sales Tax.

The Establishment is not about to give back the 16th Amendment to the US Constitution.

So, the alleged "Fair Tax" is a US Chamber of Commerce scam to reduce corpoporate taxes at the expense of average, working Americans.

If Corporations were really people, they'd be paying 40% in Federal Taxes (income + FICA + Medicare).

Lower the damned individual payroll tax rate, Dingus McCarthy.
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Offline catfish1957

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If Corporations were really people, they'd be paying 40% in Federal Taxes (income + FICA + Medicare).



And corporate EPS numbers and dividends would shrink to near zero.

Speak for yourself.  :cool:
I display the Confederate Battle Flag in honor of my great great great grandfathers who spilled blood at Wilson's Creek and Shiloh.  5 others served in the WBTS with honor too.

Online Bigun

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The Feds will KEEP the income tax AND implement a new National Sales Tax.

The Establishment is not about to give back the 16th Amendment to the US Constitution.

So, the alleged "Fair Tax" is a US Chamber of Commerce scam to reduce corpoporate taxes at the expense of average, working Americans.

If Corporations were really people, they'd be paying 40% in Federal Taxes (income + FICA + Medicare).

Lower the damned individual payroll tax rate, Dingus McCarthy.

No! They will not if the FairTax becomes law.
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Offline Kamaji

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The Feds will KEEP the income tax AND implement a new National Sales Tax.

The Establishment is not about to give back the 16th Amendment to the US Constitution.

So, the alleged "Fair Tax" is a US Chamber of Commerce scam to reduce corpoporate taxes at the expense of average, working Americans.

If Corporations were really people, they'd be paying 40% in Federal Taxes (income + FICA + Medicare).

Lower the damned individual payroll tax rate, Dingus McCarthy.


Nonsense.
Correlation does not imply causation

Offline Kamaji

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I'd love for this to happen, along with repealing 16th and 17th but it will probably never happen. We love government in this country too much. We just do.

Repealing the 16th wouldn't do diddly-squat to prevent income taxation of wages.  Capital gains, interest, and rents?  Yes, but not wages.
Correlation does not imply causation

Online Bigun

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"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Offline DefiantMassRINO

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Would a National Sales Tax require a Constitutional Amendment, like the Federal Income Tax did?

Does the Fair Tax explicitly and Constitutionally repeal the 16th Amendment (Federal Income Tax)?

Are there exemptions for food, medicine, healthcare, and clothing?  What about real estate?

Does that mean the cost of building materials at Home Depot will increase almost 30% at a time when we need to build more housing?

Will the sales tax be applicable to business-to-business purchases such as software or paper?
« Last Edit: January 20, 2023, 06:16:43 pm by DefiantMassRINO »
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Offline catfish1957

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I've purposely stayed out of the fray on an exact system to manage taxation.

Problem is, economics is not a static system.  Depending on market conditons, and overall financial criteria, one system may not work over an another.

I think the consensus, might  be a flexed program based on national debt, GDP, and Debt to capitalization, plus profit ratios of those who are being taxed.

I envision the best bet may be a bastardized version of a flat tax and a VAT, and that VAT floating on the criteria I mentioned earlier.
Any new systen DOES in my opinion need to have provisons to clip the wings or eliminate the IRS.  Plus reduce or eliminate any new debt or hae provisons to reign in runaway government spending.
I display the Confederate Battle Flag in honor of my great great great grandfathers who spilled blood at Wilson's Creek and Shiloh.  5 others served in the WBTS with honor too.

Offline Kamaji

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Would a National Sales Tax require a Constitutional Amendment, like the Federal Income Tax did?

Does the Fair Tax explicitly and Constitutionally repeal the 16th Amendment (Federal Income Tax)?

Are there exemptions for food, medicine, healthcare, and clothing?  What about real estate?

Does that mean the cost of building materials at Home Depot will increase almost 30% at a time when we need to build more housing?

Will the sales tax be applicable to business-to-business purchases such as software or paper?

With respect to point 1: (a) a Constitutional amendment would not be necessary for a national sales tax because that is simply a species of "indirect" excise tax, (b) a Constitutional amendment was not needed for the income tax on wages, only for the income tax on rents, interest, dividends, and capital gains, and (c) most likely, if the Supreme Court had been left to its own devices, the 1895 Income Tax cases would have been overruled simply because the logic underpinning the holding was specious in the extreme, meaning that even for the income tax as it applied to rents, interest, dividends, and capital gains ultimately an amendment would probably not have been necessary.
Correlation does not imply causation

Online Bigun

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Would a National Sales Tax require a Constitutional Amendment, like the Federal Income Tax did?

Does the Fair Tax explicitly and Constitutionally repeal the 16th Amendment (Federal Income Tax)?

Are there exemptions for food, medicine, healthcare, and clothing?  What about real estate?

Does that mean the cost of building materials at Home Depot will increase almost 30% at a time when we need to build more housing?

Will the sales tax be applicable to business-to-business purchases such as software or paper?

Read the friggin bill and get back to me when you have some idea as you what you are talking about @DefiantMassRINO

https://www.congress.gov/bill/118th-congress/house-bill/25/text?r=18&s=1

You might also spend some time here in the research library section.
« Last Edit: January 20, 2023, 06:32:20 pm by Bigun »
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Offline catfish1957

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Read the friggin bill and get back to me when you have some idea as yo what you are talking about @DefiantMassRINO

https://www.congress.gov/bill/118th-congress/house-bill/25/text?r=18&s=1

As much as I have screamed about the federal  deficit every other post, you have equally supported our need for tax reform.  Keep up the good fight my friend,   :beer:
I display the Confederate Battle Flag in honor of my great great great grandfathers who spilled blood at Wilson's Creek and Shiloh.  5 others served in the WBTS with honor too.

Online Bigun

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As much as I have screamed about the federal  deficit every other post, you have equally supported our need for tax reform.  Keep up the good fight my friend,   :beer:

On that you can depend @catfish1957 I've been working toward this for thirty years. I'm firmly convinced it's the key to fixing our Republic.

"Our federal tax system is, in short, utterly impossible, utterly unjust and completely counterproductive . . . (it) reeks with injustice and is fundamentally un-American . . . it has earned a rebellion, and it's time we rebelled."

Ronald Reagan, 1983
« Last Edit: January 20, 2023, 08:58:36 pm by Bigun »
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Offline DefiantMassRINO

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The Bill looks more idealogical than fiscal:

- it defangs/eliminates IRS
- transfers Federal tax collection to states while taxation power remains Federal
- deregulates Presidential campaign finance
- it moves Social Security, Medicare, and Pension liabilities to general, annual operating budget
- it transfers Federal tax burden away from income to sales tax on goods, services, and bartering

Deficiencies are:

- Tax rate will be ambiguously variable, which is a source of uncertainty for planning.
- It lacks exemptions or suspension during Declarations of Emergencies and Disaster.
- It has no explicit provisions for reduced Government spending.

It has potential to reduce future spending on current "Non-Discretionary" spending by moving Social Security, Medicare, and Pensions to the general budget.

State Government will still need to intrude into people's lives to calculate, collect, and administer the taxes.
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Online Bigun

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The Bill looks more idealogical than fiscal:

- it defangs/eliminates IRS
- transfers Federal tax collection to states while taxation power remains Federal
- deregulates Presidential campaign finance
- it moves Social Security, Medicare, and Pension liabilities to general, annual operating budget
- it transfers Federal tax burden away from income to sales tax on goods, services, and bartering

Deficiencies are:

- Tax rate will be ambiguously variable, which is a source of uncertainty for planning.
- It lacks exemptions or suspension during Declarations of Emergencies and Disaster.
- It has no explicit provisions for reduced Government spending.

It has potential to reduce future spending on current "Non-Discretionary" spending by moving Social Security, Medicare, and Pensions to the general budget.

State Government will still need to intrude into people's lives to calculate, collect, and administer the taxes.

“If an enemy power bent on destroying our nation were somehow given the opportunity to devise our tax code with a goal of sapping the nation of its economic vitality, imparing the moral fiber of its people, wasting huge resources on unproductive administration, and causing division and frustration in its people, it could do little better than to adopt our current Internal Revenue Code…The American Tax system is a complete mess.”

 Richard Vedder (Hearing before the Subcommittee on Oversight of the Internal Revenue Service of the Committee on Finance, U.S. Senate, 98the Cong., 2nd Sess., September 17,1984) p.130

"It is a signal advantage of taxes on articles of consumption that they contain in their own nature a security against excess. They prescribe their own limit, which cannot be exceeded without defeating the end proposed - that is, an extension of the revenue.  When applied to this object, the saying is as just as it is witty that, "in political arithmetic, two and two do not always make four." If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them.

Federalist #21

"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Online Bigun

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"What the income tax does is lead the people of this country down a path to where actual control of their resources, which in the end is the control over their will, is handed off to the government.
The government then manipulates that will in order to destroy the freedom of our electoral system through the income tax structure, and we call the resulting slavery a free system.
In point of fact, it is not as the founders understood, and the only way to restore real freedom is to give people back control over the income that they earn so that they won‘t, at the voting booth and in other phony issues, be subject to that manipulation."


   ALAN KEYES IS MAKING SENSE Television Show Monday, Jan. 28, 2002
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Offline Weird Tolkienish Figure

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Would a National Sales Tax require a Constitutional Amendment, like the Federal Income Tax did?

Does the Fair Tax explicitly and Constitutionally repeal the 16th Amendment (Federal Income Tax)?

Are there exemptions for food, medicine, healthcare, and clothing?  What about real estate?

Does that mean the cost of building materials at Home Depot will increase almost 30% at a time when we need to build more housing?

Will the sales tax be applicable to business-to-business purchases such as software or paper?

With the traditional fair tax there were "necessity" exemptions like food, clothing etc. Not sure about building materiels.

In theory it wouldn't matter, the burden is shifted from income to consumption, so you may still end up with more money in your pocket.


Online Bigun

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With the traditional fair tax there were "necessity" exemptions like food, clothing etc. Not sure about building materiels.

In theory it wouldn't matter, the burden is shifted from income to consumption, so you may would still end up with more money in your pocket.

Fixed
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Online Bigun

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As much as I have screamed about the federal  deficit every other post, you have equally supported our need for tax reform.  Keep up the good fight my friend,   :beer:

BTW @catfish1957 those two things are very closely connected (as you well know already)
"I wish it need not have happened in my time," said Frodo.

"So do I," said Gandalf, "and so do all who live to see such times. But that is not for them to decide. All we have to decide is what to do with the time that is given us."
- J. R. R. Tolkien

Online Hoodat

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I'd love for this to happen, along with repealing 16th and 17th but it will probably never happen. We love government in this country too much. We just do.

Sadly true.
If a political party does not have its foundation in the determination to advance a cause that is right and that is moral, then it is not a political party; it is merely a conspiracy to seize power.

-Dwight Eisenhower-

Offline Kamaji

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With the traditional fair tax there were "necessity" exemptions like food, clothing etc. Not sure about building materiels.

In theory it wouldn't matter, the burden is shifted from income to consumption, so you may still end up with more money in your pocket.



“In theory” - such wonderful, comfortable words.  “In theory” the mRNA vaccines would cure Covid-19 without any risk to the vaccinated.  How’d that work out?
Correlation does not imply causation

Online Hoodat

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There should be no exemptions to any tax.  Eveyone pays.  Everyone.  It's called 'Equal Protection'.  It actually says it in the Constitution.
If a political party does not have its foundation in the determination to advance a cause that is right and that is moral, then it is not a political party; it is merely a conspiracy to seize power.

-Dwight Eisenhower-

Offline DefiantMassRINO

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A National Sales Tax would mean that the Government would be less intrusive in People's lives and in Businesses.

A National Sales Tax would put more pressures on Businesses' profit margins as its inputs are taxed and its customers have to pay a higher price for their output.

Low wage retailers would benefit by lower structural labor costs.

The effect on businesses that consume significant input is more ambiguous.  A company that consumes a service would pay a tax if its provided by an independent entity, but if they hire the persons in-house, the company can avoid a sales tax.  This would provide businesses that in-source services a competitive price advantage over those who consume third-party services.

For an enterprise that consumes goods as inputs, the structural cost of those inputs increases, possibly exponentially for value-added goods as inputs.  This may put domestic manufacturing or value-add enterprises at a competitive disadvantage.

Small domestic manufacturing business concerns would be competing on an even playing field with each other, but at a significant disadvantge to foreign manufacturers and those who import foreign goods.  Importers and their customers are paying a sales tax on a finished product, versus each input and the finished product being subject to the sales tax.

The current income dispartities in this nation are primarily caused by capital gains being taxed less than wages and profit.  A national sales tax does nothing to resolve this disparity unless a sales tax is applied to each acquisition and disposition of stock shares, bonds, and assets.

The  Fair Tax Act provides for a significantly less intrusive Federal Government, but, would lead to a re-balancing of American economies - personal, business, and Government.

Such a proposal should be through an expansive and diverse set of economic modeling to measure outcomes.

A monetary impact would be a decrease in the velocity of money through the economy.  A higher velocity of money would produce more economic activity with a smaller money supply.

Taxation is a no-goldilocks-solution problem  Any proposal that initiates discussion about changing the tax regime in the United States is a productive excercise.

Wages and Profits need to be taxed less; Capital Gains need to be taxed more.  Also, business taxes should be applied based upon the business activity in the U.S. versus based upon where the business is domiciled.

To bring more supply chains back to Amercia, we need a tax regime that decreases input costs - goods, services, labor - rather than increasing it.

I'm of the general belief that consumption tax regimes are regressive.
« Last Edit: January 21, 2023, 04:38:07 pm by DefiantMassRINO »
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