Fair tax must be enacted incimentally

Discussion in 'Economy' started by Supposn, Feb 21, 2010.

  1. Supposn
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    Supposn Senior Member

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    I agree that it’s economically more desirable to tax consumption rather than income.

    I am dubious of both the political and economic feasibility of replacing our entire, (both individual and corporate) income tax revenues with a consumption tax. It is certainly financially imprudent to attempt it in a single step. I advocate we transform our major sources of tax revenue incrementally.

    Some suggest first eliminating individual income taxes and later attempt eliminating corporate income taxes. Mine is not the most popular opinion but I believe that eliminating individual and retaining corporate income taxes is economically illogical. I also believe that to whatever extent and rates we tax individuals’ incomes, we should continue to tax corporate incomes. Otherwise too many entrepreneurs will be further enabled to evade paying their fair share of income taxes.

    I contend that after the enactment of one of the incremental tax source transferences, it will become obvious that the consumption tax is approaching an unacceptable tax rate. If that should occur, the government should interrupt or halt the transformation process. If I’m incorrect, (i.e. a consumption tax can replace all income tax revenue), then incremental tax source transference will accomplish complete replacement of all income taxes.

    Those who insist upon passage of an act to accomplish the entire transference in a single step are insisting that an act to accomplish transference never be passed.

    Respectfully, Supposn
     
  2. edthecynic
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    edthecynic Censored for Cynicism

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    You seem to be contradicting yourself.
    If a consumption tax is economically more desirable than an income tax, how could it be unacceptable?
    Are you for or against a Fair tax?
    If you are for it, what would you think of replacing all taxes with a corporate tax?
     
    Last edited: Feb 21, 2010
  3. Supposn
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    Supposn Senior Member

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    EdTheCynic, the misspelled title should be “Fair tax must be enacted incrementally”. I advocate to the greatest feasible extent we replace federal income tax revenues with a sales tax.

    I do not believe the U.S. Congress would imprudently enact transferring our major sources of federal revenue in a single step. I also strongly doubt that it is feasible to replace all (individual and corporate) income tax revenues with a sales tax.

    I believe that after one of the incremental (tax source transference) steps, we will acknowledge that the sales tax is approaching an unacceptable tax rate. We will then delay or completely halt further tax source transference.

    If my belief is incorrect, we will completely eliminate federal income taxes.

    Corporate and individuals' income taxes are expenses for government and the direct taxpayers. Corporate income taxes are passed onto customers and are in affect an indirect sales tax.

    I believe that to whatever extent and rates we tax individuals’ incomes, we should continue to tax corporate incomes. Otherwise too many entrepreneurs will be further enabled to evade paying their fair share of income taxes. That’s the only economic justification for corporate income taxes rather than a sales tax. It is also unfeasible to decrease or eliminate corporate income taxes and not grant similar consideration for individuals’ income taxes.

    Respectfully, Supposn
     
  4. edthecynic
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    edthecynic Censored for Cynicism

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    Corporate taxes are de facto consumption taxes since they are passed on to the consumer, but most Fair taxers are totally against corporate taxes.
     
  5. Supposn
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    Supposn Senior Member

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  6. Supposn
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    Supposn Senior Member

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    FYI:
    Sales taxes are not collected for goods delivered or services that are performed beyond the taxing nation's borders.

    Respectfully, Supposn
     
  7. Toronado3800
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    Toronado3800 VIP Member

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    So for the consumption tax do I understand it would be something like 14% of the money you spend towards your Hummer goes to the IRS?

    Or essentially whatever income tax is now plus whatever sales tax is?
     
  8. Supposn
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    Supposn Senior Member

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    Toranado, I suppose you’re making a point? Your message is obtuse.
    Respectfully, Supposn
     
  9. Neubarth
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    Neubarth At the Ballpark July 30th

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    I favor a flat Federal income tax. Fifty percent of everything in excess of $30,000 a year per wage earner. The states can take the other fifty percent if they feel so led. It is hard to collect sales tax and VAT taxes have been proven over and over again to thwart purchases in the country that foolishly imposes ithem. Stay away from increases in corporate income tax. That would totally destroy the remaining economy in what was once a great country.
     
  10. Toronado3800
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    Toronado3800 VIP Member

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    I probably typed too quickly.

    So the tax is basically going to hit folks WHEN they spend their money not during the year they earn it.

    It should simplify the tax code at the very least.
     

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