[POLL] - Liberals, how much is a "fair share?" - Taxes

[kaz]

No, it's assuming the FairTax does what it's supporters claim it does, which is produce the same amount of revenue as the current tax code.

That has never been my goal since I think the government is wasting more money than it spends for the benefit of anybody. My goal is to level the playing field of the tax code, make it far more difficult to manipulate to increase the power, prestige, and personal wealth of those in government, and to produce sufficient money to cover what the government needs to do rather than all the things opportunistic politicians and bureaucrats want to do.

That's fine, but understand that's a different question. The FairTax movement claims their proposal is revenue neutral.

For prices to remain the same under "FairTax" as they are today, one, by definition, must be believe that not only are all business taxes baked into the cost of goods, but that all individual taxes are as well on top of the individuals paying those taxes.

Other than the death tax, which is a small portion of Federal revenues, name a tax that is not baked into the cost of products we buy.

 

[RKMBrown]

That has never been my goal since I think the government is wasting more money than it spends for the benefit of anybody. My goal is to level the playing field of the tax code, make it far more difficult to manipulate to increase the power, prestige, and personal wealth of those in government, and to produce sufficient money to cover what the government needs to do rather than all the things opportunistic politicians and bureaucrats want to do.

That's fine, but understand that's a different question. The FairTax movement claims their proposal is revenue neutral.

For prices to remain the same under "FairTax" as they are today, one, by definition, must be believe that not only are all business taxes baked into the cost of goods, but that all individual taxes are as well on top of the individuals paying those taxes.

Other than the death tax, which is a small portion of Federal revenues, name a tax that is not baked into the cost of products we buy.

What does "baked in" really mean. I assume you mean to view taxes as a component of the consumer producer economy in which government taxation is one of the principle elements that affect the cost of products. From that perspective all existing and expected taxes are currently "baked in" even death taxes.

Why would one argue that the cost of death tax isn't baked in? If you are going to take half the assets of a family does that family not have to raise prices to pay the tax? The money taken represents an amount of supply, thus take a tax, even death tax, and you are affecting the system.

 

[Polk]

That has never been my goal since I think the government is wasting more money than it spends for the benefit of anybody. My goal is to level the playing field of the tax code, make it far more difficult to manipulate to increase the power, prestige, and personal wealth of those in government, and to produce sufficient money to cover what the government needs to do rather than all the things opportunistic politicians and bureaucrats want to do.

That's fine, but understand that's a different question. The FairTax movement claims their proposal is revenue neutral.

For prices to remain the same under "FairTax" as they are today, one, by definition, must be believe that not only are all business taxes baked into the cost of goods, but that all individual taxes are as well on top of the individuals paying those taxes.

Is that what they've said, or has the argument been that the Fair Tax would not reduce our buying power or significantly raise the cost of goods and services? I don't think I've seen an argument that a Fair Tax would be revenue neutral for the federal government. If that is an argument they are making, that could be another reason I would likely oppose a Fair Tax.

Those first two statements are the same. And yes, they do claim it is revenue neutral.

Does the FairTax rate need to be much higher to be revenue neutral?

The proper tax rate has been carefully worked out; 23 percent does the job of: (1) raising the same amount of federal funds as are raised by the current system, (2) paying the universal rebate, and (3) paying the collection fees to retailers and state governments. Unlike some other proposals, this rate has been independently confirmed by several different, nonpartisan institutions across the country. Detailed calculations are available from FairTax.org.

What is the FairTax | What is a Consumption Tax | Answers on Tax Reform - Americans For Fair Taxation

 

[Polk]

Remember the fair tax replaces all other taxes, it's not added onto them. So, for the loaf of bread and your numbers:

$1.25 + 9 (local sales tax) + 17 (revenue neutral Fair Tax) - 17 (eliminated taxes that were included in the price) = $1.34.

Remember the business is no longer paying business tax, payroll taxes, unemployment tax, ...

Now here's the first kicker, think of all the money businesses spend on taxes that don't generate government revenue. Tax accountants, tax lawyers, time to fill in forms, tax disincentives to make economically decisions, ... Those costs go away too.

Now here's the second kicker, everyone who does cash work now and aren't paying taxes are going to be taxpayers because they pay tax when they buy things.

Now here's the third kicker, everyone selling goods in our economy (domestic and foreign companies) are paying the same taxes, which helps US firms compete.

And here's the biggest kicker of all, instead of driving out US companies, we're a tax haven and companies will actually come here.

The cost of the loaf of bread will quickly go down to less than $1.25. There is no transition to be made. On 12/31 we have our current crocked system, on 1/1 we go to the Fair Tax. Initially prices are stable, then they fall.

And you know what octopi those things are. Companies will get creative like they do now and find more advantages, only now they do it with a tax code that drives inefficiency and then they will do it with a market that drives efficiency.

And that doesn't even cover the liberty and privacy aspects of businesses and individuals reporting every piece of their financial data to government and politicians using the code to amass power.

The bolded portion literally claims he's thought of a tax system that can generate free money.

Hence the term ... wait for it ... wait some more ... almost there ... almost ... Revenue Neutral ...

You're saying all individual income taxes today are baked in to the price of every good. That's a much broader claim.

 

[Polk]

That has never been my goal since I think the government is wasting more money than it spends for the benefit of anybody. My goal is to level the playing field of the tax code, make it far more difficult to manipulate to increase the power, prestige, and personal wealth of those in government, and to produce sufficient money to cover what the government needs to do rather than all the things opportunistic politicians and bureaucrats want to do.

That's fine, but understand that's a different question. The FairTax movement claims their proposal is revenue neutral.

For prices to remain the same under "FairTax" as they are today, one, by definition, must be believe that not only are all business taxes baked into the cost of goods, but that all individual taxes are as well on top of the individuals paying those taxes.

Other than the death tax, which is a small portion of Federal revenues, name a tax that is not baked into the cost of products we buy.

Individual income tax.

 

[Polk]

That's fine, but understand that's a different question. The FairTax movement claims their proposal is revenue neutral.

For prices to remain the same under "FairTax" as they are today, one, by definition, must be believe that not only are all business taxes baked into the cost of goods, but that all individual taxes are as well on top of the individuals paying those taxes.

Other than the death tax, which is a small portion of Federal revenues, name a tax that is not baked into the cost of products we buy.

What does "baked in" really mean. I assume you mean to view taxes as a component of the consumer producer economy in which government taxation is one of the principle elements that affect the cost of products. From that perspective all existing and expected taxes are currently "baked in" even death taxes.

Why would one argue that the cost of death tax isn't baked in? If you are going to take half the assets of a family does that family not have to raise prices to pay the tax? The money taken represents an amount of supply, thus take a tax, even death tax, and you are affecting the system.

If you take that broad a view, yes, all taxes are "baked in", but that's stretching to the point of being meaningless.

 

[Polk]

To put the claims in layman's terms:

- The "FairTax" won't increase the total cost of goods and services.
- The "FairTax" repeals all other federal taxes.
- The "FairTax" raises the same amount of income as the current tax code

It is mathematically impossible for all three of those claims to be true.

 

[Foxfyre]

Pointing out that a desire for less pain is a normal human trait is not an insult. I never said that you are "okay with any amount of pain with any form of taxation." Quite the contrary, I merely pointed out the opposite, which is that I fully understand that you are not ok "with any amount of pain" and are also not ok "with any form of taxation" and that this is a normal human trait to reject pain.

Not sure how you missed the many direct answers to your often repeated question re "what products the Fair tax would be assessed on at at what points of the production chain." The many answers even included links to explicit explanations and lists. In summary the fair tax would be like the current sales taxes collected by the states. It would be assessed basically at the retail side of production. The products affected would include things like toys, cars, most of the stuff you get at Walmart in the non food sections,... The products not affected would include basic necessities such as prescription drugs, flour, milk, fruit, the roof over your head, etc.

Yes the poor would have to pay the same sales tax on a flat panel tv that anyone else would have to pay. Voila... fair tax.

Excerpting your specific line that I objected to:
I understand that your income is currently less than it used to be, so of course you are ok increasing and/or putting any amount of pain of taxation on income. I get that. I'm sure most people would agree to system of taxation that did not affect them. Now I may be getting old, and I can accept your explanation that you didn't intend to say that, but I am still sharp enough to read that you said it. And it sure wasn't qualified by anything that preceded or followed it.

But okay. So you want to assess tax at the retail level only. What happens if I buy my flat screen TV in Mexico?

And all those other purchases by those who make and assemble all the components of that flat screen TV are not taxed? And you don't see all sorts of ways to wheel and deal like crazy at home, tax free, but wholesale the product to Mexico or Canada or Grand Cayman or wherever to sell back to us retail?

to the point of contention... My knee jerk is from your earlier post that said you prefer income tax over sales tax cause you already paid income tax and don't want to be double taxed. Being that I've been double, triple, and quadruple taxed most of my life I understand where you are coming from. I understood you to mean that you prefer a system of income tax over sales tax because you are already invested disproportionately in the current system of pain. My jerkish comments were meant to provide you with poison pills associated with the current system in the hopes to argue/nudge you to consider that the current system is about to be changed one way or another. I added the word pain.. cause that's what I see taxes as.. pain. <smiley face so you know I sound grumpy but I'm smiling and pls don't take me seriously when I pick on the greatest generation (who should have known better than to support pyramid schemes)>

Anyhow To your very good question on sales tax avoidance... we also have states that don't charge sales tax, and the states that do have varying sales tax per region. The answer to that paradox is that the sales tax is due to the state/region where your primary homestead is. Voila.. problem solved. Minor items like the number 1 from McDonalds yeah you can get away with not sending that sales tax to TX when you are visiting GA. Even amazon now charges you sales tax based on your home address.

Thus if you buy a TV in mexico, but live in TX you owe the sales tax in TX.

So, if I buy stuff all over the country or several other countries, and live in Texas, I pay the tax for everything I bought to somebody in Texas? Who is going to collect it there? Who do I pay it to? Who determines whether I have paid what I owe? How do they determine what I owe? Will we need to keep receipts showing tax paid on everything we own in case somebody questions whether we paid the tax or not?

I'm really not trying to be facetious or difficult here. But everything I have read on the Fair Tax has been exalted as some great fix for the problem by the proponents, and a whole bunch of potential problems have been spelled out by the critics and skeptics, none of which I have heard anybody address to my satisfaction yet. '

So I remain among the skeptics and I'm willing to be persuaded. But you haven't done it so far. Nor has anybody else. And none of the proponents seem to be able to see the complexities tht actually exist.

 

[Polk]

Excerpting your specific line that I objected to:
I understand that your income is currently less than it used to be, so of course you are ok increasing and/or putting any amount of pain of taxation on income. I get that. I'm sure most people would agree to system of taxation that did not affect them. Now I may be getting old, and I can accept your explanation that you didn't intend to say that, but I am still sharp enough to read that you said it. And it sure wasn't qualified by anything that preceded or followed it.

But okay. So you want to assess tax at the retail level only. What happens if I buy my flat screen TV in Mexico?

And all those other purchases by those who make and assemble all the components of that flat screen TV are not taxed? And you don't see all sorts of ways to wheel and deal like crazy at home, tax free, but wholesale the product to Mexico or Canada or Grand Cayman or wherever to sell back to us retail?

to the point of contention... My knee jerk is from your earlier post that said you prefer income tax over sales tax cause you already paid income tax and don't want to be double taxed. Being that I've been double, triple, and quadruple taxed most of my life I understand where you are coming from. I understood you to mean that you prefer a system of income tax over sales tax because you are already invested disproportionately in the current system of pain. My jerkish comments were meant to provide you with poison pills associated with the current system in the hopes to argue/nudge you to consider that the current system is about to be changed one way or another. I added the word pain.. cause that's what I see taxes as.. pain. <smiley face so you know I sound grumpy but I'm smiling and pls don't take me seriously when I pick on the greatest generation (who should have known better than to support pyramid schemes)>

Anyhow To your very good question on sales tax avoidance... we also have states that don't charge sales tax, and the states that do have varying sales tax per region. The answer to that paradox is that the sales tax is due to the state/region where your primary homestead is. Voila.. problem solved. Minor items like the number 1 from McDonalds yeah you can get away with not sending that sales tax to TX when you are visiting GA. Even amazon now charges you sales tax based on your home address.

Thus if you buy a TV in mexico, but live in TX you owe the sales tax in TX.

So, if I buy stuff all over the country or several other countries, and live in Texas, I pay the tax for everything I bought to somebody in Texas? Who is going to collect it there? Who do I pay it to? Who determines whether I have paid what I owe? How do they determine what I owe? Will we need to keep receipts showing tax paid on everything we own in case somebody questions whether we paid the tax or not?

I'm really not trying to be facetious or difficult here. But everything I have read on the Fair Tax has been exalted as some great fix for the problem by the proponents, and a whole bunch of potential problems have been spelled out by the critics and skeptics, none of which I have heard anybody address to my satisfaction yet. '

So I remain among the skeptics and I'm willing to be persuaded. But you haven't done it so far. Nor has anybody else. And none of the proponents seem to be able to see the complexities tht actually exist.

You're supposed to report it annually, but no one actually does.

 

[RKMBrown]

Excerpting your specific line that I objected to:
I understand that your income is currently less than it used to be, so of course you are ok increasing and/or putting any amount of pain of taxation on income. I get that. I'm sure most people would agree to system of taxation that did not affect them. Now I may be getting old, and I can accept your explanation that you didn't intend to say that, but I am still sharp enough to read that you said it. And it sure wasn't qualified by anything that preceded or followed it.

But okay. So you want to assess tax at the retail level only. What happens if I buy my flat screen TV in Mexico?

And all those other purchases by those who make and assemble all the components of that flat screen TV are not taxed? And you don't see all sorts of ways to wheel and deal like crazy at home, tax free, but wholesale the product to Mexico or Canada or Grand Cayman or wherever to sell back to us retail?

to the point of contention... My knee jerk is from your earlier post that said you prefer income tax over sales tax cause you already paid income tax and don't want to be double taxed. Being that I've been double, triple, and quadruple taxed most of my life I understand where you are coming from. I understood you to mean that you prefer a system of income tax over sales tax because you are already invested disproportionately in the current system of pain. My jerkish comments were meant to provide you with poison pills associated with the current system in the hopes to argue/nudge you to consider that the current system is about to be changed one way or another. I added the word pain.. cause that's what I see taxes as.. pain. <smiley face so you know I sound grumpy but I'm smiling and pls don't take me seriously when I pick on the greatest generation (who should have known better than to support pyramid schemes)>

Anyhow To your very good question on sales tax avoidance... we also have states that don't charge sales tax, and the states that do have varying sales tax per region. The answer to that paradox is that the sales tax is due to the state/region where your primary homestead is. Voila.. problem solved. Minor items like the number 1 from McDonalds yeah you can get away with not sending that sales tax to TX when you are visiting GA. Even amazon now charges you sales tax based on your home address.

Thus if you buy a TV in mexico, but live in TX you owe the sales tax in TX.

So, if I buy stuff all over the country or several other countries, and live in Texas, I pay the tax for everything I bought to somebody in Texas? Who is going to collect it there? Who do I pay it to? Who determines whether I have paid what I owe? How do they determine what I owe? Will we need to keep receipts showing tax paid on everything we own in case somebody questions whether we paid the tax or not?

I'm really not trying to be facetious or difficult here. But everything I have read on the Fair Tax has been exalted as some great fix for the problem by the proponents, and a whole bunch of potential problems have been spelled out by the critics and skeptics, none of which I have heard anybody address to my satisfaction yet. '

So I remain among the skeptics and I'm willing to be persuaded. But you haven't done it so far. Nor has anybody else. And none of the proponents seem to be able to see the complexities tht actually exist.

Gez.. how many different ways can you possibly come up with to ask the same question

>> So, if I buy stuff all over the country or several other countries, and live in Texas, I pay the tax for everything I bought to somebody in Texas?

No. as I explained above, the store that collects payment typically collects the sales tax. In the example I provided Amazon knows your address and uses it to charge sales tax for your area. They charge the sales tax and pay your state for you. It's automatic. The same happens when you buy a car. It's just a thing that the retailer is supposed to do. It's not complicated you don't do anything. They get your address as you are paying. Use a card? They have your address. Use a check? They have your address. Use cash? Ok is it a big item that has to be registered like a car? They will ask for your address. Their computer system will look up the tax rate. In the old days you would just tell them what your tax rate is. Yeah that was a bit odd. Computers make it much easier to do sales tax calculations. It's all automatic. Now, if you find a retailer that does not charge you the tax... yeah you can probably "forget" about it. That just does not happen very often. The ones that don't collect for you start to stick out like a sort thumb because folks like you are spending money there and there's no sales tax payments coming in for the the sales. It's pretty much a self policing thing. Some folks will even report obvious sales tax fraud.

Theoretically you could try to circumvent the law by finding a place to pay cash and hoping no one ever cares buy something that does not charge you sales tax and you could then pretend you forgot about it. This is pretty much impossible to get away with if it's something big like a car or big screen TV as you would stand out like a sore thumb in their computer system when you registered the car.

>> Who is going to collect it there? Who do I pay it to? Who determines whether I have paid what I owe? How do they determine what I owe?

They collect sales tax at the cash register. It's a part of the total that you pay for. Your receipt will read: item $10; fair tax $2.30; total = $12.30; Thank you for shopping at Walmart. If you don't pay they don't let you out the door with your item. They calculate sales tax by multiplying the cost of the item by the sales tax rate, in this example 10 x .23 = $2.30

>>> Will we need to keep receipts showing tax paid on everything we own in case somebody questions whether we paid the tax or not?

No. The retailers collect and pay. You just pay the bill at the point of sale. The only case where I would guess anyone would be concerned about paying sales tax is when buying a registered used vehicle. Pretty sure they provide instructions for paying the sales tax on the title. Other than vehicles I don't know anyone that bothers with making a special effort to look for things to pay sales tax on. It's sort of up to the State to make sure the retailers are collecting. They don't bother the consumers about it.

>>> I'm really not trying to be facetious or difficult here. But everything I have read on the Fair Tax has been exalted as some great fix for the problem by the proponents, and a whole bunch of potential problems have been spelled out by the critics and skeptics, none of which I have heard anybody address to my satisfaction yet. '

The problems are imagined. There are always critics. There's a reason people are running from income tax states.

>> So I remain among the skeptics and I'm willing to be persuaded. But you haven't done it so far. Nor has anybody else. And none of the proponents seem to be able to see the complexities tht actually exist.

You were being honest before when you said why you are against sales taxes... saying you are against them now because they are complex? cmon be honest. These complexities are things that you are imagining and/or blowing out of proportion. No one in TX even thinks twice about the complexities of sales tax. It's no more complex that an automatic tip charge at a restaurant. If paying the amount owed at a retail store is "complex" ... well okay.. To me, paying the total due on my bill is just not that complex.

You put the item on the counter... they ring it up... you put your card in the card reader.. the thing asks you are you ok with the total that now includes your sales tax.. you say ok.. and it bills your card and prints the receipt.. the clerk hands you the receipt for your goods. You grumble that you had to pay taxes. Then you put the item in your car and drive home.

 

[kaz]

That's fine, but understand that's a different question. The FairTax movement claims their proposal is revenue neutral.

For prices to remain the same under "FairTax" as they are today, one, by definition, must be believe that not only are all business taxes baked into the cost of goods, but that all individual taxes are as well on top of the individuals paying those taxes.

Other than the death tax, which is a small portion of Federal revenues, name a tax that is not baked into the cost of products we buy.

What does "baked in" really mean. I assume you mean to view taxes as a component of the consumer producer economy in which government taxation is one of the principle elements that affect the cost of products. From that perspective all existing and expected taxes are currently "baked in" even death taxes.

Yes, baked in means it's incorporated in the price of a product. A toaster company doesn't charge for steel directly, they charge a base price that incorporates the cost of steel as a component. Just like the cost of employees, and employee related taxes. They have to pay interest on their bonds that is high enough for investors to pay taxes and get a risk adjusted rate of return AFTER taxes. That interest is a cost and is baked in. i know you agree with that, just clarifying your question if you understand what I mean by "baked in" or not. You do.

Why would one argue that the cost of death tax isn't baked in? If you are going to take half the assets of a family does that family not have to raise prices to pay the tax? The money taken represents an amount of supply, thus take a tax, even death tax, and you are affecting the system.

The family who pays the tax doesn't have a product and can't raise prices, so I'm not sure what you mean unless you're referring to a family that owns a business. I think you could argue this to a degree, but it's not a clear as a tax paid by a company to do business.

 

[kaz]

The bolded portion literally claims he's thought of a tax system that can generate free money.

Hence the term ... wait for it ... wait some more ... almost there ... almost ... Revenue Neutral ...

You're saying all individual income taxes today are baked in to the price of every good. That's a much broader claim.

It's an obvious claim. Employees don't care what their gross pay is, they care what their take home pay is. Clearly if you hire an IT programmer, they are marketable than someone who is reliable but has no job skills. If you pay an IT Programmer $80K, and the government takes $60K in taxes, and the latter makes $20K and pays $0 in taxes, the programmer's not going to work harder. They aren't making any more, you (liberals) are.

Companies have to pay employees a market rate that is high enough to pay their taxes. As tax rates go up for higher skilled employees, their pay does as well to pay the higher taxes. Then liberals cry about the rapidly raising pay for higher skilled ignoring that higher and higher portions are just to pay the higher taxes. It's a cluster you have going.

But that the cost of individual taxes is baked into the products sold by their employers is obvious for anyone but a socialist ideologue. If employers can't pay their employees enough to pay their taxes, they don't work for them. The total cost of employees is baked into the price of their products just like the cost of steel.

 

[kaz]

Other than the death tax, which is a small portion of Federal revenues, name a tax that is not baked into the cost of products we buy.

What does "baked in" really mean. I assume you mean to view taxes as a component of the consumer producer economy in which government taxation is one of the principle elements that affect the cost of products. From that perspective all existing and expected taxes are currently "baked in" even death taxes.

Why would one argue that the cost of death tax isn't baked in? If you are going to take half the assets of a family does that family not have to raise prices to pay the tax? The money taken represents an amount of supply, thus take a tax, even death tax, and you are affecting the system.

If you take that broad a view, yes, all taxes are "baked in", but that's stretching to the point of being meaningless.

You're obviously not a business owner. We are keenly aware of every cost we have to pay and we focus on the bottom line, the amount after ALL expenses, including taxes, are paid. If not, we'd go bust. We don't say here's the bottom line, wow, I did OK this year. Now I'll pay the taxes, and I won't worry about paying my employees enough to pay theirs, oh yeah, and now I'll pay this tax... That would never happen. Taxes are clearly and directly baked into the price of our product.

Everyone realizes that a toaster incorporates steel. In what possible universe would the same owner of the same company not incorporate the cost of taxes or the higher price we pay for things (loans, employees) so they can pay their taxes?

We say wow, we pay Joe $80K. But $20K of that is so he can pay his taxes, so let's count on the books and charge customers for only $60K. We pay 10% on our bonds, but 2% is for investors to pay taxes and get a market rate of return for the risk level of our bonds, so let's put it on the books as if we pay 8% and eat the extra 2% and not charge customers for it. Let's not charge customers for the matching payroll taxes we pay for our employees, or business taxes, or business property taxes. Let's charge customers for the steel, but not all that.

SSSSUUUURRRRREEEEEEE we do, Virginia .....

 

[RKMBrown]

The family who pays the tax doesn't have a product and can't raise prices, so I'm not sure what you mean unless you're referring to a family that owns a business. I think you could argue this to a degree, but it's not a clear as a tax paid by a company to do business.

Everyone has a product. At a minimum they have their labor. Their labor is sold for wages, but also may be intrinsic or hoarded by working for themselves. Some people work for a living and earn income. Consumers may spend money that they have in their pockets and may also invest.

Taking money from someone reduces the amount of product they can buy. It's gone taken from them. They have to work to replace it.

Yes, I started to refer to family businesses but did not want to get into estate issues. So I broadened the topic just to cover the taking of money from peter to fund government and redistribute to paul.

>>> it's not a clear as a tax paid by a company to do business.

I pooped my pants when I saw the government take the Miami Dolphins away from the Robbie Family. Taking away a family business to pay death taxes is an overt example, yes. But really all death taxes are the same. The money taken represents security, represents a house, represents labor.

The only reason the death taxes are not as overt at the moment is based on the reforms provided by the republican party. Reforms that the democrats wish to go away.

 

[Foxfyre]

to the point of contention... My knee jerk is from your earlier post that said you prefer income tax over sales tax cause you already paid income tax and don't want to be double taxed. Being that I've been double, triple, and quadruple taxed most of my life I understand where you are coming from. I understood you to mean that you prefer a system of income tax over sales tax because you are already invested disproportionately in the current system of pain. My jerkish comments were meant to provide you with poison pills associated with the current system in the hopes to argue/nudge you to consider that the current system is about to be changed one way or another. I added the word pain.. cause that's what I see taxes as.. pain. <smiley face so you know I sound grumpy but I'm smiling and pls don't take me seriously when I pick on the greatest generation (who should have known better than to support pyramid schemes)>

Anyhow To your very good question on sales tax avoidance... we also have states that don't charge sales tax, and the states that do have varying sales tax per region. The answer to that paradox is that the sales tax is due to the state/region where your primary homestead is. Voila.. problem solved. Minor items like the number 1 from McDonalds yeah you can get away with not sending that sales tax to TX when you are visiting GA. Even amazon now charges you sales tax based on your home address.

Thus if you buy a TV in mexico, but live in TX you owe the sales tax in TX.

So, if I buy stuff all over the country or several other countries, and live in Texas, I pay the tax for everything I bought to somebody in Texas? Who is going to collect it there? Who do I pay it to? Who determines whether I have paid what I owe? How do they determine what I owe? Will we need to keep receipts showing tax paid on everything we own in case somebody questions whether we paid the tax or not?

I'm really not trying to be facetious or difficult here. But everything I have read on the Fair Tax has been exalted as some great fix for the problem by the proponents, and a whole bunch of potential problems have been spelled out by the critics and skeptics, none of which I have heard anybody address to my satisfaction yet. '

So I remain among the skeptics and I'm willing to be persuaded. But you haven't done it so far. Nor has anybody else. And none of the proponents seem to be able to see the complexities tht actually exist.

Gez.. how many different ways can you possibly come up with to ask the same question

>> So, if I buy stuff all over the country or several other countries, and live in Texas, I pay the tax for everything I bought to somebody in Texas?

No. as I explained above, the store that collects payment typically collects the sales tax. In the example I provided Amazon knows your address and uses it to charge sales tax for your area. They charge the sales tax and pay your state for you. It's automatic. The same happens when you buy a car. It's just a thing that the retailer is supposed to do. It's not complicated you don't do anything. They get your address as you are paying. Use a card? They have your address. Use a check? They have your address. Use cash? Ok is it a big item that has to be registered like a car? They will ask for your address. Their computer system will look up the tax rate. In the old days you would just tell them what your tax rate is. Yeah that was a bit odd. Computers make it much easier to do sales tax calculations. It's all automatic. Now, if you find a retailer that does not charge you the tax... yeah you can probably "forget" about it. That just does not happen very often. The ones that don't collect for you start to stick out like a sort thumb because folks like you are spending money there and there's no sales tax payments coming in for the the sales. It's pretty much a self policing thing. Some folks will even report obvious sales tax fraud.

Theoretically you could try to circumvent the law by finding a place to pay cash and hoping no one ever cares buy something that does not charge you sales tax and you could then pretend you forgot about it. This is pretty much impossible to get away with if it's something big like a car or big screen TV as you would stand out like a sore thumb in their computer system when you registered the car.

>> Who is going to collect it there? Who do I pay it to? Who determines whether I have paid what I owe? How do they determine what I owe?

They collect sales tax at the cash register. It's a part of the total that you pay for. Your receipt will read: item $10; fair tax $2.30; total = $12.30; Thank you for shopping at Walmart. If you don't pay they don't let you out the door with your item. They calculate sales tax by multiplying the cost of the item by the sales tax rate, in this example 10 x .23 = $2.30

>>> Will we need to keep receipts showing tax paid on everything we own in case somebody questions whether we paid the tax or not?

No. The retailers collect and pay. You just pay the bill at the point of sale. The only case where I would guess anyone would be concerned about paying sales tax is when buying a registered used vehicle. Pretty sure they provide instructions for paying the sales tax on the title. Other than vehicles I don't know anyone that bothers with making a special effort to look for things to pay sales tax on. It's sort of up to the State to make sure the retailers are collecting. They don't bother the consumers about it.

>>> I'm really not trying to be facetious or difficult here. But everything I have read on the Fair Tax has been exalted as some great fix for the problem by the proponents, and a whole bunch of potential problems have been spelled out by the critics and skeptics, none of which I have heard anybody address to my satisfaction yet. '

The problems are imagined. There are always critics. There's a reason people are running from income tax states.

>> So I remain among the skeptics and I'm willing to be persuaded. But you haven't done it so far. Nor has anybody else. And none of the proponents seem to be able to see the complexities tht actually exist.

You were being honest before when you said why you are against sales taxes... saying you are against them now because they are complex? cmon be honest. These complexities are things that you are imagining and/or blowing out of proportion. No one in TX even thinks twice about the complexities of sales tax. It's no more complex that an automatic tip charge at a restaurant. If paying the amount owed at a retail store is "complex" ... well okay.. To me, paying the total due on my bill is just not that complex.

You put the item on the counter... they ring it up... you put your card in the card reader.. the thing asks you are you ok with the total that now includes your sales tax.. you say ok.. and it bills your card and prints the receipt.. the clerk hands you the receipt for your goods. You grumble that you had to pay taxes. Then you put the item in your car and drive home.

I'm sorry but the circular argument here is making me dizzy and you inadvertently continue to misrepresent my arguments. You either can't understand the underlying problems I see in the administration of a Fair Tax or I am asking the questions badly. I did inadvertently run across this site this morning and, without making any assumptions that they aren't also seeing some things incorrectly here, they seem to have summarized it nicely.

Re the Fair Tax:

Pros:

1. Federal income taxes would be completely abolished. According to Fairtax.org, this would include all ancillary taxes on personal income such as estate, gift, capital gains, alternative minimum, self-employment, Social Security, Medicare, and payroll taxes.

2. With the repeal of federal income taxes, the IRS (Internal Revenue Service or Income Robbery Service, depending on one&#8217;s perspective) would have much less power to snoop into the personal and private financial lives of American individuals. Ideally, the IRS would simply cease to exist.

3. The Fair Tax would be &#8220;progressive&#8221; in the sense that it would avoid taxing financially challenged (i.e., poor) people for basic necessities. This is accomplished by means of a &#8220;prebate&#8221;, which according to Fairtax.org would be $2,348 per year for a single person or $6,297 per year for a family of four.

4. The Fair Tax is calculated to be &#8220;revenue neutral&#8221;, meaning that all current government services would continue to be fully funded because the money that is raised from this national sales tax would be equal to the amount of revenue that is lost due to the repeal of federal income taxes. Programs such as Social Security, Medicare, etc. would be unaffected.

5. Because this tax system is consumption-based rather than income-based, people could exercise a certain amount of control over how much tax they pay. Since the tax is only applied to new (not used, secondhand, etc.) items at the point of sale, a relatively frugal person could avoid paying taxes on most things, and might even make money because of the &#8220;prebate&#8221;. Meanwhile, wealthy people who choose to live &#8220;high on the hog&#8221; without paying attention to their spending choices would probably pay more tax.

6. Since the Fair Tax only taxes consumption, it would not punish businesses for expanding and creating more jobs, investing in research and development, or donating to charity. Also, the individuals who create and maintain those businesses would have more disposable income to expand and compete in international markets (assuming that they make relatively wise choices, see the point above).

7. The base price of goods and services (that is, their cost of production before adding any taxes, profits, etc.) would be lower because the embedded costs of the current income tax system would no longer be a factor. This would partially offset the increase in the total price of new products and services that would result from the Fair Tax.

8. From the standpoint of government revenue collection, the &#8220;problem&#8221; of tax evasion would be reduced because people who currently resist paying income taxes and/or derive their income from black market sources would be taxed automatically at the point of sale whenever they purchase new goods and services. Moreover, the government would no longer need to spend taxpayer money in order to chase down income tax evaders.

9. A national sales tax such as this would be much more transparent than the current tax system. There would be no more loopholes, special exemptions, payroll taxes, embedded costs, or other factors that allow people under the current system to avoid realizing how much tax they are actually paying. With the amount of taxation clearly visible to the general public, people (hopefully) would be less likely to tolerate wasteful spending, corruption, and inefficiency in government, resulting in lower levels of taxation and a stronger economy overall.


Cons:

1. The retail price of new goods and services would increase. Although the actual cost of these items would arguably remain the same due to the elimination of embedded income taxes mentioned in Pro #7 above, the initial &#8220;sticker shock&#8221; of apparently higher prices could have a dampening effect on the economy.

2. If the income tax is not fully repealed as promised OR a future president and/or Congress decides to re-instate some portion of the income tax code under the guise of a &#8220;national emergency&#8221; or something similar, we could end up with a national sales tax AND an income tax, which would be disastrous for our economic freedom.

3. The actual rate of the national sales tax would be 30%, not 23% as the Fair Tax proponents claim. This difference is due to the deceptive language that the proponents use to describe the tax rate calculation. Not only is this deception insulting, but it also makes it easier for the government to raise the tax rate in the future because people will think that the current rate is lower than it actually is.

4. Unlike the income tax brackets, this national sales tax proposal is not indexed for inflation, meaning that as inflation increases the base price of goods and services, the amount of sales tax that you pay will also increase.

5. People who have paid into the Social Security system and/or private savings accounts for retirement will be effectively double taxed when they begin withdrawing their money and spending it. This is because most of the money that people have managed to save up to this point already has been taxed under the current system.

6. Because tax rates would be simplified under the national sales tax system, this could ironically make it easier for the government to raise the tax rate on certain items that it deems &#8220;unhealthy&#8221; or &#8220;dangerous&#8221;. If this occurs, things such as fatty foods, cigarettes, firearms, and an indeterminate number of other politically unpopular items could wind up being taxed at exorbitant rates, which would certainly go against the spirit of a &#8220;fair&#8221; tax system.

7. If the Fair Tax is sufficiently high (like 30% or more), this could encourage more people to enter the black market in order to avoid the tax. This could cause crime that is often associated with black markets to escalate and effectively criminalize otherwise ordinary people.

8. The &#8220;prebate&#8221; that is built into the Fair Tax system could actually do more harm than good in the long run because it would effectively put all Americans (except those without Social Security numbers) on the government dole, and this could create problems with dependency and the &#8220;free lunch&#8221; mentality as experienced by recipients of current government welfare programs.

9. The Fair Tax does nothing to solve the underlying cause of high taxation, which is excessive government spending. As long as the federal government keeps spending taxpayer dollars on things that it has no business being involved with in the first place, it will continue to require high taxes in order to finance its expenditures, including the increasing cost of the national debt. Simply changing the method of taxation is not going to change the root causes of unfair taxes.
http://www.karlonia.com/2007/04/16/fair-tax-pros-and-cons/

One of the first laws of management is that you won't fix dishonest or incompetent people by changing the system. And you won't fix a flawed system by changing the people.

The bottom line here as I see it is that the Fair Tax does nothing to solve the underlying problem of an ever bigger, more expense, more intrusive, more authoritarian government that ever invades more and more of our lives, nor will it be beneficial to most people over the existing tax code.

 

[Foxfyre]

Now then, after laying out the pros and cons of a "Fair Tax" system, l can see how a Fair Tax would stimulate economic growth. If it truly is assessed only at the retail level, the USA would again become the nation of choice for manufacturing for export. That is strongly appealing to me. And for honest people, it would eliminate all the issues of what is a 'fair share' of taxes to pay.

But we would have to first set some hard rules into place:

1. The government must be prohibited from imposing additional taxes to the Fair Tax.

2 The government must be prohibited from picking and choosing what products and services will be subject to the Fair Tax.

3. The government cannot raise the tax without a national referendum of the people giving their consent.

The issue of double taxation on retirees could be remedied by increasing the amount of prebate for retirees for a number of years and gradually phase that out over time.

 

[kaz]

Now then, after laying out the pros and cons of a "Fair Tax" system, l can see how a Fair Tax would stimulate economic growth. If it truly is assessed only at the retail level, the USA would again become the nation of choice for manufacturing for export. That is strongly appealing to me. And for honest people, it would eliminate all the issues of what is a 'fair share' of taxes to pay.

But we would have to first set some hard rules into place:

1. The government must be prohibited from imposing additional taxes to the Fair Tax.

2 The government must be prohibited from picking and choosing what products and services will be subject to the Fair Tax.

3. The government cannot raise the tax without a national referendum of the people giving their consent.

The issue of double taxation on retirees could be remedied by increasing the amount of prebate for retirees for a number of years and gradually phase that out over time.

Bam! Yes, these are critical. On #1, this is one thing I disagree with the Fair Tax people on. They want #1, but they are OK with doing it without a constitutional amendment. I believe 100% that if we did that congress would simply start adding back all the other taxes and we'd be worse off and not better. It has to be done with a Constitutional Amendment that covers all three of your points.

 

[kaz]

The family who pays the tax doesn't have a product and can't raise prices, so I'm not sure what you mean unless you're referring to a family that owns a business. I think you could argue this to a degree, but it's not a clear as a tax paid by a company to do business.

Everyone has a product. At a minimum they have their labor. Their labor is sold for wages, but also may be intrinsic or hoarded by working for themselves. Some people work for a living and earn income. Consumers may spend money that they have in their pockets and may also invest.

Taking money from someone reduces the amount of product they can buy. It's gone taken from them. They have to work to replace it.

Yes, I started to refer to family businesses but did not want to get into estate issues. So I broadened the topic just to cover the taking of money from peter to fund government and redistribute to paul.

>>> it's not a clear as a tax paid by a company to do business.

I pooped my pants when I saw the government take the Miami Dolphins away from the Robbie Family. Taking away a family business to pay death taxes is an overt example, yes. But really all death taxes are the same. The money taken represents security, represents a house, represents labor.

The only reason the death taxes are not as overt at the moment is based on the reforms provided by the republican party. Reforms that the democrats wish to go away.

I'm a bit confused about this argument. If you think I'm defending the death tax, you're wrong. I consider it to be the most singularly evil tax inflicted on the American people on our government because it has zero purpose except pure social engineering. You'll hear me bash Social Security/Medicare and Obamacare the most because they are taxes that make all people dependent on government. But from a pure evil standpoint, they both pale compared to the death tax.

All I'm saying is that income taxes, business taxes and all the rest that derive from companies are clearly in the end directly baked into the price of the products/services sold by that company. A death tax is actually paid by a person's estate when they die. I'm not defending it clearly, but when you say the death tax is the same, I don't know what you mean that it's baked into the price of products sold by companies. It's just purely taxing wealth and is done to remove money from individual people and is not designed to fund the government. It's a punitive, hateful tax by cynical socialists and politicians. It's not an economic tax.

 

[RKMBrown]

One of the first laws of management is that you won't fix dishonest or incompetent people by changing the system. And you won't fix a flawed system by changing the people.

The bottom line here as I see it is that the Fair Tax does nothing to solve the underlying problem of an ever bigger, more expense, more intrusive, more authoritarian government that ever invades more and more of our lives, nor will it be beneficial to most people over the existing tax code.

Yeah well your laws of management are flawed. A dishonest system can most certainly increase the number of dishonest and incompetent people. Further, good people can make most flawed systems work in spite of it's flaws.

>>> The bottom line here as I see it is that the Fair Tax does nothing to solve the underlying problem of an ever bigger, more expense, more intrusive, more authoritarian government that ever invades more and more of our lives, nor will it be beneficial to most people over the existing tax code.

I'm not sure whether or not you see the irony that you start your sentence by bemoaning our system of soft tyranny by the majority, then end your sentence by demanding we increase the benefits that the majority already enjoys in this soft tyranny.

 

[RKMBrown]

The family who pays the tax doesn't have a product and can't raise prices, so I'm not sure what you mean unless you're referring to a family that owns a business. I think you could argue this to a degree, but it's not a clear as a tax paid by a company to do business.

Everyone has a product. At a minimum they have their labor. Their labor is sold for wages, but also may be intrinsic or hoarded by working for themselves. Some people work for a living and earn income. Consumers may spend money that they have in their pockets and may also invest.

Taking money from someone reduces the amount of product they can buy. It's gone taken from them. They have to work to replace it.

Yes, I started to refer to family businesses but did not want to get into estate issues. So I broadened the topic just to cover the taking of money from peter to fund government and redistribute to paul.

>>> it's not a clear as a tax paid by a company to do business.

I pooped my pants when I saw the government take the Miami Dolphins away from the Robbie Family. Taking away a family business to pay death taxes is an overt example, yes. But really all death taxes are the same. The money taken represents security, represents a house, represents labor.

The only reason the death taxes are not as overt at the moment is based on the reforms provided by the republican party. Reforms that the democrats wish to go away.

I'm a bit confused about this argument. If you think I'm defending the death tax, you're wrong. I consider it to be the most singularly evil tax inflicted on the American people on our government because it has zero purpose except pure social engineering. You'll hear me bash Social Security/Medicare and Obamacare the most because they are taxes that make all people dependent on government. But from a pure evil standpoint, they both pale compared to the death tax.

All I'm saying is that income taxes, business taxes and all the rest that derive from companies are clearly in the end directly baked into the price of the products/services sold by that company. A death tax is actually paid by a person's estate when they die. I'm not defending it clearly, but when you say the death tax is the same, I don't know what you mean that it's baked into the price of products sold by companies. It's just purely taxing wealth and is done to remove money from individual people and is not designed to fund the government. It's a punitive, hateful tax by cynical socialists and politicians. It's not an economic tax.

My only point was to show how death taxes are in fact baked in. Not sure what was confusing about my explanation. I'm not sure why are you insisting that death taxes are not a part of the economy and/or are already thus baked into the economy.