After reading "Our View" on Aug. 10 on the need to place a sales tax on Internet sales, I have to respond.
Instead of merely tinkering with the current tax system over and over and expecting different results, there is a better way and it's called the FairTax. It would be a national sales tax that replaces all federal taxes and would automatically include Internet sales. Talk about a level playing field.
Since the FairTax would replace all income taxes, it would abolish the Internal Revenue Service. Employees keep everything they earn — no more federal withholding. Prices stay about the same: businesses pass on their federal taxes to consumers.
The 22 percent hidden tax we pay on everything now would vanish, to be replaced with a 23 percent national sales tax. Most of the companies that took their business overseas (because of taxes) would come back to business tax-free America with all those jobs we lost.
Compare our free spending politicians and our economy to an alcoholic or a drug addict. To be cured, they need to hit rock bottom and then take the cure. This country is very close to economic rock bottom. The cure is staring us in the face: the FairTax.
We can tinker forever with the current tax system or really fix it for good. I support the FairTax as the solution.
Gary Fuller, Greenwood
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It's funny, if you watch any
It's funny, if you watch any blogs, whenever politics or government are discussed, you have liberals standing steadfast supporting thier side and you have conservatives standing just as steadfast supporting thier side and things get heated. But when you discuss the "fair tax" things rarely get heated. Questions are asked, answers given and everyone learns a thing or two. Why does this happen? Because a "fair tax" system makes sense that's why! If we want our representatives to grow the brass it takes to make this change, then it is up to us to tell them so or replace them with someone that will!
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.It's called the "prebate".
Part of the FairTax legislation is the "prebate", a monthly rebate of the sales tax on the "poverty" level of income. You would know about this if you had actually read the legislation. For example, suppose that level is determined to be $40,000 per year, as in your example. You would receive $9,200 (23%) in 12 equal installments. That is, that family would pay ZERO tax. And the FairTax completely replace employment taxes (Social Security and Medicare) so the lower income folks would make out like bandits.
The prebate would be paid to everyone. Nothing fairer than that, unless your habit is to whine and moan about the rich paying their "fair share". But when some "fat cat" buys a Gulfstream V for $50 million, he'll have to cough up an extra $11.5 million. Isn't that soaking the rich?
That's a lot of checks for the Feds to write, but we already have the infrastructure - it's called Social Security.
The FairTax does affect everyone proportionately. But that fact is ignored by those who a vested interest in the current tax structure.
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.This comment ...
... was aimed at Mr. Frecker. By the way, a family making less than the poverty level would still receive $9200. That is, they pay NEGATIVE taxes. Progressives who have concocted the current EIC scam say this is a good thing - as long as it originates with them.
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.Fair(?) tax
The idea of a national sales tax has some merit; but, to me, there are too many unanswered questions about it. What would the rate be (23% seems very high)? What would be taxed? Everything? Or would some necessities be exempt from the tax? Would there be exemptions for low-income Americans? Etc., etc.?
And it seems a larger sales tax will disproportionately impact the middle class and below. If the typical "family of four" has an income of about $40,000, they'll have to spend nearly all of it just for necessities and living expense. Thus, all of their income will be taxed. But those with higher incomes won't have to spend all their income just to survive. The impact of a large sales tax will be less on them.
Most people agree that the present income tax system doesn't work very well. Would it be "fairer", if there were a "flat" tax on ALL income? Would a flat tax provide enough revenue to fund the government at whatever level the politicians settle on?
To be "fair" a tax should affect everyone proportionately. How to achieve that is the problem.
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.Those unanswered questions
1. //What would the rate be (23% seems very high)?// 23% does seem high when you look at it directly, as many do; and I agree with that. But when you look at the big picture, you will see that that 23% is just right. Let me explain: If you're an average (middle-class) citizen, your wages are taxed at 15%. Include your FICA taxes (7.65%) and you're paying the gov't about 23.65% of your wages each month. Now add on the 7.65% that your employer makes and the gov't is raking in over 31¢ on every dollar you make. Include Estate, Gift, capital gains, alternative minimum, and self-employment taxes and you're talking some serious money. The FairTax eliminates all of those income taxes and puts them back in your pocket and back in your employer's pocket. This frees up money for you to spend as you wish. Having a 23% (inclusive; or 30% exclusive) consumption tax is sounding much better now, isn't it?
2. //What would be taxed? Everything? Or would some necessities be exempt from the tax?// Only NEW goods and services (at the retail level) will include the FairTax. No exemptions, no exceptions. The reason for this (and the reason for the monthly rebate; more on this later) is to prevent loopholes. Exempt just 1 item and that opens Pandora's Box. Consequently, by removing the loopholes we also remove the ability for lobbyists to lobby for new loopholes. It's been said that the FairTax will eliminate nearly 1/2 of the lobbyists in DC.
You probably noticed that I said "Only NEW goods and services". The reason used goods are not taxed is because the taxes were already been paid on them when they were new. One great aspect of the FairTax is that it eliminates double and multiple taxation. Thus, limiting the amount of money the gov't can steal from us. With the FairTax, if we _choose_ to avoid paying taxes, it is our right to do so. But keep in mind that there are still things that we must purchase new; food, underwear, and such aren't something you would want after they've been used.
3. //Would there be exemptions for low-income Americans?// This is where the monthly rebate comes in. I believe someone else here explained it very well, but here is my version: We all have what we define as our necessities. For some it may be food and rent; for others it may be a mortgage payment and toiletries; and yet for others it may be beer and Cheez-its. Point being that what you define as your necessities is immaterial to the value of your monthly rebate and you can spend that money on whatever you like. To be "fair" every taxpayer is reimbursed for the taxes s/he is estimated to payout in the coming month. This amount is based on the composition of your family. For instance, a Single Person (M or F) with no children will receive approximately $209 per month. Whereas a married couple with two children will receive approximately $564 per month.
The monthly rebate also addresses your later comment about "If the typical 'family of four' has an income of about $40,000, they'll have to spend nearly all of it just for necessities and living expense." By untaxing their necessities, we are allowing them to temporarily live tax-free while still supporting their local economy. If they spend past that limit, they gradually begin to pay taxes. The more they spend past that amount, the more their effective tax rate is.
4. //And it seems a larger sales tax will disproportionately impact the middle class and below.// You're absolutely right, for any standard "sales tax"; but the FairTax isn't your standard sales tax. The FairTax is the only non-partisan tax bill in Congress. It was engineered, drafted, and written by businessmen; for Americans. The vast majority of support is from Republicans, but a good number of Democrats (those who have taken the time to read HR25) also agree with it and support it fully.
5. //Would it be "fairer", if there were a "flat" tax on ALL income? Would a flat tax provide enough revenue to fund the government at whatever level the politicians settle on?// Remember this: The current income tax started out as a flat tax. That flat tax soon became the bloated system we are in today. A flat tax will do nothing more than "reboot" our current tax system once again (last reboot was in 1986 under President Reagan). The FairTax will completely wipe out the existing 70,000+ pages of IRC and start over with a clean slate of 133 (double spaced) pages.
6. //To be "fair" a tax should affect everyone proportionately. How to achieve that is the problem.// You are absolutely 100% correct. Problem is that that solution is right here under our noses; it's called the FairTax. I implore you to please look further into the FairTax. Visit FairTax.org. Learn from the source before you explore other opinions of it; and please don't listen to critics who try to tell you that "it's in the fineprint".
If you're still reading, I thank you sincerely for listening.
Robert Williams
@TXFairTaxer
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.What could be fairer than
What could be fairer than ANYONE who purchases ANYTHING pays the tax on it at time of purchase, regardless of their income...PERIOD. No exemptions for low income families, or any of that nonsense. Don't want to pay the tax or can't afford the tax? Don't buy the item. The tax is the tax, and that's it. Perhaps, utilities such as heat and lights might be exempted, but that should be it. There aren't enough politicians who have the stones to support a fair tax or a flat tax. It'll never happen due to lack on testicular fortitude on the part of our "leaders". We're stuck with the beast that eats its own tail.
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.There are allways loopholes.
The problem is loopholes. There are always loopholes, and those who would spend more would have a greater motivation to exploit them.
Ask yourself this: Would it be worth driving to Canada to buy stuff? Maybe for most of our purchases, no. But as you ratchet up the price that goes from a no to a maybe to a hell yeah.
Example - GE buy all their vehicles in Canada, and registers them up there. They just dodged a millions in taxes.
I'm not saying it's a bad idea, I just think there is far more motivation to game the system at the top than at the bottom, and thats a problem with any tax system.
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.Loopholes
Jason, you're absolutely right. There will always be loopholes and there will always be miscreants who try to exploit those loopholes. But the FairTax does the best job that I've seen when it comes to comparing tax systems and loopholes.
The current tax system has over 70,000 pages of code that most tax attorneys and economists (including U.S. Secretary of the Treasury, Timothy Geithner) don't completely understand. The current tax system has opened up the loophole system for every and any lobby group in the US to attack, bend, and twist to their will.
The FairTax on the other hand, eliminates the entire IRC and starts over with a clean slate. It eliminates Income Taxes (one of the most attacked sources of lobbyists) and does not exempt any new goods or services. Additionally, to help the poor, the FairTax provides all U.S citizens with a monthly rebate of the taxes they are estimated to spend in the coming month. The reason for this rebate is to prevent the need to allow lobby groups to attack the code.
Now, am I saying that loopholes won't open up? No, unfortunately I cannot predict the future. But I can tell you that from what I have seen, heard, and read, the FairTax does a damn fine job of keeping the critters out.
As for driving across the border to buy stuff, remember this: First, this happens today under our current tax system. Second, if you buy anything over a certain monetary value you are required to pay the duty fees. So, technically, whether you purchase an item here or you head over the border to buy it and bring it back you will be paying the FairTax regardless. So all you've really done is wasted time and energy by driving further than you needed to. And if you want to risk being caught smuggling it back, then you risk losing it. Again, I'm not saying this cannot or will not happen, just saying that it isn't as likely under the FairTax.
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I am a proponent of the conversation of a "Fair Tax" but Jason brings up a good point. How many of us make a state at the N.H. state liquor store...But with our current tax structure, as it affects the middle class, the ones that use the least pay the most. The ones that use the most pay nothing..or get paid. It's like incetified poverty. Little side note. Do you know that the arbitrary marker called the poverty line in the U.S. is higher than the average standard of living in Great Britian.
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.Didn't know it, but doesn't
Didn't know it, but doesn't surprise me in the least. There are only two things to be in the U.S.A. Rich or poor. If you're rich, you have everything; if you're poor, you're given everything by your govt. If uou're working middle class, you get to watch everyone ride up and down the elevator while you get the shaft.
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Would you like to respond? Login or create a new account. You'll need to verify your account before you can respond.Well stated. However, I think
Well stated. However, I think most will agree that anything would be better than what we have now. There are more words in the current tax code than there are in the Holy Bible. The only ones who fully understand it (the tax code) are the very ones who enforce it. How fair is that for the average working stiff who can barely understand his own pay check.
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