There has been a lot of talk in recent days about Eliot Spitzer, NY Gov., and his "call girl ring". I heard today a journalist on TV saying it was time we made prostitution legal. Can you believe that? He said we could then get them to pay taxes.
How stupid his comment when he can have his cake and eat it too. With the FairTax, he can keep prostitution illegal as it should be and take their tax money anyway, every time they purchase goods or services.
And while we're at it, let's get some tax money out of those other underground businesses. Let the drug dealers help us with our taxes, every time they purchase goods or services.
Let the illegal aliens help us with our taxes, every time they purchase goods or services.
Let the "under-the-table" business dealers help us with our taxes, every time they purchase goods and services.
And how about tapping the tourist industry. We pay their taxes when we visit their country - let them help us with our taxes, every time they purchase our goods or services.
Whenever I receive a plea for money from a congressman or a presidential candidate, I write back (using their stamp, natch) and tell them when they publicly endorse the FairTax, then I will donate money to their campaign. So far, no takers.
Don't you think it's time our Congress quit worrying about their campaigns and started worrying about our economy? All of these points made above can help to relieve our tax burden. Tell Congress to pass the FairTax (HR25 & S1025)
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11 comments:
The one valid point about the fairtax is that it would indeed collect more taxes from those who work "off the books" such as hookers and drug dealers.
But since the Fairtax rate would have to be at least 60%, there would be a vast underground economy, and a huge tendency for cheating.
Fairtax would be at least 60% because in reality -- you can not make the government pay itself a sales or income tax. That's just a farce transaction.
Since Fairtax depends on over a trillion dollars in taxes COMING from the government itself, that trillion can't be collected, and the Fairtax rate has to go up accordingly.
Cannot comprehend the thinking that suggests such biz as drug dealers & prostitution are going to charge FairTax for their services unless you bring them out into the light by making them legal.
Mark, I'm tired of your lies - get off my blog!
Notr, get a clue - drug dealers & prostitutes are NOT going to be charging a FairTax for their services. The ARE going to be PAYING the Fairtax everytime they go to the grocery store, the doctor, buy a new car, buy ingredients to make new drugs, etc. etc. etc. That's how they will be contributing to the tax base - same as all of us honest people.
It's time you read The FairTax Book or go to their web site: www.fairtax.org. Thanks for your input.
Mark,
Show the data, references and proof, or go away.
You've been jumping around ranting like an idiot for three months. I have found the multiple blogs you've gone to in order to leave comments. Your posts there are also baseless. Nobody can refute your false statements. It's not possible to refute the lies you've told, Mark.
Thanks for the back-up, Westcoastinventer. I am sick and tired of Mark, who insists on spreading his lies all over the blogs. We won't be hearing from him anymore - I cut him off.
I don't mind intelligent discussions pro & con, using the facts, but to twist the truth the way Mark did simply says he ridiculous.
Either deal with the facts, as written in the FairTax bill (HR25 & S1025) or don't deal with me.
I've been reading Fairtax blogs, and its clear Mark is right about at least one thing.
My Fairtax Book does really say the federal government will be a major taxpayer. I found it in my book.
I happen to know that is impossible, after talking to professional economist to check for sure. Any transaction where the federal government pays itself a sales or income tax is just an accounting trick, and no income is generated.
After exchanging emails and phone calls with Dr's Kotlikoff,
Gale, and Tuerck (Beacon Hill Institute), I need to add that they claim that it doesn't change the Fairtax rate whether the federal government taxes itself or not. I'm still not totally convinced, but their explanation is that if we don't tax the federal government consumption, not only does the Fairtax consumption base go down, but the revenue required also falls by a like amount, and the Fairtax rate remains the same.
My problem with their expert opinions is that I always thought that the revenue neutral amount was a fixed amount based on the 2007 income, payroll, and estate/gift tax revenue. If revenue is fixed and the base is reduced, it seems to me that the rate must go up. But, that isn't the view of the three experts I consulted with. If anyone has other experts available, I'd really appreciate getting a fourth opinion??? Thanks!
badcut56,
Whether it's Federal, State, or Local, any government is a taxpayer already. All government employees pay income tax, FICA, capital gains, estate tax, etc. So when they buy something at the mall they are paying a fraction back to themselves. The same thing applies to private businesses as well. Retail stores (Wal-mart, Home Depot, Kroger, etc.) have many employees who get a discount, but not below cost (a few are at cost but most are around 10-20% off retail). They are paying a fraction back to themselves. Non retail company employees buy some goods or services from a business that is directly or indirectly served by their employer.
If you buy a quantity of soda, and recycle the cans, you just did the same thing.
This mentioned part of the Fair Tax is to simplify the tax code and to prevent government entities from having a tax advantage (especially when situations arise with government and private sector selling similar goods or services). Why should any government entity have a tax advantage?
badcut56,
You are right--governments should not have an advantage when competing with the private sector to provide goods or services--mostly services. The problem with the Fairtax as I see it is one of overkill. By untaxing businesses, it seems to me that the playing field is now level. But, HR25 taxes government consumption and the playing field is now tilted heavily toward the private sector. Perhaps that's a good idea, but it also means that certain services that can better be provided by governments will cost us taxpayers 30% more. And that doesn't seem to be such a good idea?
As to the "quaint" notion if the government can pay itself a tax -- sure it can. It just can't count that as income. So in effect, while it might send itself a check, it doesn't create income for the government, obviously.
So the question is -- does Fairtax plan depend on the government paying itself a tax?
I haven't read the book carefully enough, but if it does say that the federal government will become a major taxpayer -- as claimed -- then it is mistaken on that point.
You will have to ask those who added up the revenue streams for Fairtax, to see if they added any taxes paid to the federal government by the federal government. Any transaction where the federal government pays itself a tax is essentially an accounting procedure, and can not possibly create income.
Reilly,
I have spent the last six weeks working with Professor Gale, Kotlikoff, and Dr Tuerck at BHI, the think tank that did the Fairtax base/rate study back in 2005, on the subject of the federal government taxing itself.
Turns out it doesn't matter if the federal government taxes itself or not. The sales tax rate remains unchanged. The reason for this is that if you reduce the consumption base by eliminating federal purchases, then the revenue required also is reduced by an appropriate amount, and the rate stays the same.
However, in the case of the BHI study, I now believe that BHI made a fundamental error. When they chose to tax the federal consumption, they forgot to add sufficient revenue to offset or pay for the tax. This means, for example, that if we decide not to tax the federal consumption, the consumption base would be reduced by $916B, but there is no offsetting revenue available. The revenue neutral amount does not include an adjustment for federal taxes paid. So, leaving the rate at 23.8% would not raise enough revenue.
The bottom line is that the revenue neutral rate should have been 26.4%, not the 23.8% the BHI study came up with. And, the exclusive tax rate, that is the percentage that all merchants have to add to their costs plus profits in order to arrive at a retail price, would be 35+%.
The reason given for all this taxing stuff is to keep the federal government from competing with the private sector. I think that was unnecessary, but the fact remains that taxing the federal government creates no new revenue and is merely an accounting trick.
Rather than read the Boortz "bible", I'd recommend you read the September 2005 BHI study which can be found on the Fairtax website. Try to find anywhere that the study team added revenue to offset taxing the federal consumption. It isn't there!
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