FairTax Blog

FAIRTAX NEEDED NOW

2009-10-11T14:01:00.000-07:00

There has never been a time in our lives when we needed the FairTax so much. Total unemployment stands at 17 percent nationwide. Youth unemployment is above 50 percent. The tax gap averages $350 billion per year. This is the amount the IRS cannot collect with our current tax system. You and I have to make up that difference. It costs us well over $300 billion every year to fill out our tax forms. We spend over seven billion hours filling out tax forms. The only ones who benefit from our tax system are those who know how to cheat the system, politicians who reward friends and punish enemies with it, and half of the lobbyists in D. C. who make 7 figure incomes from clients.

Passage of the FairTax immediately frees up $650 billion to grow our economy. Estimates are that the GDP will grow between seven and ten percent the first year the FairTax is in effect. The Dow Jones Industrials is expected to double quickly because of the FairTax. The FairTax means a 25 percent increase in spendable income for workers.

How do we pass the FairTax? The first thing is to make people aware of the FairTax. Americans for Fair Taxation has raised $250,000 as a first step in creating TV ads educating 140,000,000 taxpayers. In June the Rasmussen Poll found that 43 percent of Americans favor replacing the income tax system with an undefined national consumption tax! That’s real progress. If we want change we must look to ourselves. It is up to each of us to ask people we know if they have heard of the FairTax. Then direct them to http://www.fairtax.org/. We also offer webinars the fourth Thursday of each month at https://www.gotomeeting.com/register/476518786. You must pre-register.

Tell your congressmen you want the FairTax.

Best regards, Al Ose

This letter was written by FairTax volunteer, Al Ose. He hit the nail on the head with this letter. The bills are in congress now: HR25 and S296. Ask your congressmen to become sponsers of these bills and start pushing them towards fruition. We need the FairTax NOW!

OBAMA'S ADMINISTRATION NEEDS TO RETHINK

2009-05-05T16:12:00.000-07:00

Following is a letter from Jim Bennett, a FairTax volunteer, regarding the proposed crack down on tax havens and the FairTax solution:

Rather than crack down on tax havens, as the Obama Administration announced it would do on May 4, 2009, we could do better if we, ourselves, were to become the world’s tax haven. And there is a bill in Congress to do just that - The Fair Tax Act of 2009, HR25, S296.

The Obama Administration proposes a series of measures to eliminate deductions for companies that take jobs overseas, combined with reforming the tax credit system. But with 70,000 pages of tax statutes, regulations and revenue rulings, the closing of one loophole necessarily results in the opening of another. The Administration is overly sanguine that adding 800 revenue agents will be enough do the policing job that its proposal would require.

The FairTax, on the other hand, while being fairer to low-income people than today’s tax code, eliminates all taxes on business and investment and repatriates dollars voluntarily. The FairTax replaces payroll taxes, estate, gift and generation-skipping taxes, and corporate and personal income taxes with a national retail sales tax on consumption of all new property and services -except education - once and only once. A rebate to all households with valid social security numbers for tax on consumption for essentials assures the tax is fair to low-income families.

Millions of dollars of research say the tax will fully fund the federal government at current real spending levels. The FairTax would bring trillions of dollars of offshore capital back to the United States in months - without hiring any more revenue agents. The repatriation would be free of federal compulsion.

The Obama Administration needs to rethink its approach.

APRIL 15TH - SOMEDAY JUST ANOTHER SPRING DAY

2009-04-15T09:00:00.000-07:00

April 15, 2009 :

The following is from Steve King, a U.S. Congressman, who is pushing the FairTax.

King Addressing National FairTax Rally on Tax Day:

"The FairTax will unleash the power of America’s worker, allow us to grow out of the current economic downturn" WASHINGTON, D.C.

Cong. Steve King made the following statement on Tax Day, the date taxes are due to the I.R.S. King will speak at a national FairTax rally this evening in Columbia, SC. King will be joined by former Gov. Mike Huckabee and [others].

"April 15th is our annual day of reckoning with the IRS and the day the government stakes its claim on our hard-earned money. Our current tax system is simply broken.

"The worst part of our tax system is the way the income tax penalizes our work. That’s backwards. Why would government want to tax us for the work we do – taxing us more when we work harder and smarter and earn more money? Instead, the tax should be on consumption, not productivity, just like the FairTax –a national sales tax that un-taxes productivity.

"Our current income tax system is a relic of the past and we should toss it into dustbin of history. The FairTax will unleash the power of America’s worker and allow us to grow out of the current economic downturn."

"By shifting taxation from productive behavior to consumption, the FairTax allows Americans to take home their entire paycheck and eliminates the income tax and IRS. This will have a stimulative effect on our economy. Not only will Americans have more money to spend, they will have more money to save and invest—which will give American businesses more access to capital. This, in turn, will allow greater investment in research and development and result in the creation of new jobs."

"I hope you join me in firing the IRS, scrapping the income tax code and establishing the FairTax. Once we join together to get that done, we can let April 15th fade into history as just another day."

Check out the FairTax

GET YOUR LIST OF TEA PARTIES HERE

2009-04-09T13:25:00.000-07:00

Here is your link to all of the Tea Parties across the nation, well over 2000 and counting. This site shows a map marking all of the Tea Parties available to you.

Find one in your area and go do your thing. Make a sign, put on your FairTax T-shirt and hat and join the masses marching against Socialism being forced upon us in many ways.

One of these ways is the outrageous borrowing and spending by the Federal Government. It is ruining our economy and putting a huge burden of debt on us, our children, grandchildren and great-grandchildren.

But WE HAVE A SOLUTION - THE FAIR TAX! Go shout it out, pass out your literature and take advantage of these multitudes of people who are looking for a solution.

JOIN THAT TEA PARTY - BEFORE IT'S TOO LATE

2009-04-08T13:36:00.000-07:00

The following is from Gary Anderson, a FairTax Volunteer - a MUST READ:

We are NOT in a fight of left vs. right, R vs. D, or black vs. white. This is a fight to maintain the freedom to dissent. The traditional 3 branches of Government are currently colluding to wrest power from the American People, creating a facist regime bent on world domination.

Our ONLY respite is to energize the FOURTH branch of government, "The PEOPLE" to take back those powers that were delegated by us to them, by reason of their refusal to adhere to the Constitution.

We do this by non-compliance on every level; NOT just a few zealots who are glutton for punishment, but as a "body politic", in unity. First with voices, then with our labor, our taxes, and if need be, our arms.

We are at stage 1. Our voices are being heard in tea parties nationwide, & the polling places. But this fight could be over and lost by waiting to elect a new President. Therefore, our voices must be evermore LOUD.

In times future, you will be called upon for labor strikes, and sit downs; (get used to it!) Also, our tax Dollars must be wrest from their ability to automatically TAKE our money from us by the IRS (fica).

The income tax must GO! -- convenient for now, but absolutely critical for the future, if we are to de-fund the despots! I call on EVERY ONE of you, to DEMAND the FairTax, in every venue and to every person, so that our tax Dollars go directly to THE STATES (to withhold it), rather than Washington DC.

This kind of control will break the back of facism, by starving it into submission (to the people). In this respect, it can be seen that FairTax is not a "nice idea", but a necessary weapon to keep our freedom.

YOU MUST:
1. Learn your Constitution.
2. Understand the power of the FairTax to YOU (www.FairTax.org).
3. Be willing to remain resolute, despite minor incoveniences, or income constraints.
4. Commit these qualities to every person you come in contact with.

The time is short. The task is gigantic. But our latent strength is unparalled, -- if we choose to use it. This fight is "We the People" vs. the Federal government. One of these will win.

JOIN THE TEA PARTIES

2009-04-03T09:28:00.000-07:00

There has been much discussion among the Fairtaxers whether or not to join the Tea Parties on April 15th. What better place to express our freedoms and make the FairTax known to the entire nation?

Freedom and Fairtax go together. Get out there and tell the world there is a better way. Wear your Fairtax shirts, hats, pins and hand out your information. Educate these people and the media that we have the solution to our economic woes.

Below is a portion of a letter written by Jeff Locke, a FairTax Volunteer:

What does this country really need?
• A stimulus for all of us! What is more stimulating than our whole paycheck?
• Employment, jobs and a robust economy! No more business taxes means businesses produce cheaper products creating more sales and more jobs for us and our children coming out of college.
• A system that assures everyone pays for medical care, and police and fire protection!! The FairTax assures everyone pays their fair share.
• Save the family farm or business for our children and assure that our retirement and estate remains ours!! The FairTax lets everyone keep all savings and investments and assets.
• And get rid of America’s abomination, the IRS.

Again, stay the course and demand Washington pass HR 25, S 296 and all the financial system ails disappear. All of the ideas I have heard take money to research, study and time to write. Then negotiations and bickering will be needed to create a final bill. When will all of this happen with our present distractions in Washington?

The FairTax needs nothing. It is already researched, studied, written, approved by economists and ready for a vote. Let’s demand that of Washington until we get it. Scream about that at those tea parties.

STAY THE COURSE.

FAIRTAX TO BE DISCUSSED IN CONGRESS

2009-03-14T10:30:00.000-07:00

The following letter came from Tom Freeman, a FairTax supporter:

Representative Steve King (IA-5) is requesting an hour for Special Orders at the end of the legislative day on this Tuesday, March 17 to discuss the FairTax. The time is anticipated to be around 6 PM. As a member of the House Ways and Means Committee, I respectfully request that you give this address your special attention. The FairTax is the right Federal tax reform for everyone in the United States. It is also the most stimulative action the Congress can enact.

Additionally, Congressman King noted in his January 12, 2009 press release: Implementing the FairTax would immediately eliminate tax barriers that presently hurt American companies and favor production abroad over production here in America. Right now, when American companies export their products overseas, they must pay payroll taxes, embedded taxes and compliance costs to the IRS, and then compete directly with foreign manufacturers who do not pay these taxes.

Our current income tax system puts American products at a disadvantage on the world market and makes American products more expensive than their competitors in foreign markets. With the FairTax, American producers will no longer be forced to pass on embedded costs to foreign customers.

I respectfully request that a vigorous debate about the FairTax be the most important issue the House Ways and Means Committee addresses this year.

I presume the 6pm time is Eastern Daylight time. Please contact your representatives in Congress and ask them to be present to support this effort by Rep. King.

ORGANIZE A MARCH FOR THE FAIRTAX

2009-02-23T16:21:00.000-08:00

Following is a letter from Gary Anderson, a FairTax volunteer, admonishing us all that now is the time to get out there and march for the FairTax. Do it for yourself:

What does "Critical Mass" look like?

Well, is it like "Pandora's Box"? Or "St. Elmo's Fire"? If (when) the FairTax has reached critical mass, will it tap us on the sholder and say, "Ahem!", or just mow us over in growth? I suppose it depends on what speed you're moving at. As proof, logon to Michelle Malkin's site and hear about four protests in four days, and more coming as I speak. Seattle, Mesa, AZ, Denver, Kansas City, and soon Chicago, L.A. and Atlanta; IT'S HAPPENING, and you don't even realize it. Try "ReTeaParty.com" and Google "tea party".

FairTaxers may be bowled over by their own issue, and only a few are moving with the flow. As example, see this article in IBD today, in which (some) FairTaxers are doing the work to make a difference:
http://www.investors.com/editorial/IBDArticles.asp?artsec=16&issue=20090220

THERE ARE genuine FairTaxers who are VERY hip to what's happening in this groundswell. And if you're waiting for it to happen, maybe it's because it's passing you by. I have been increasingly upset by this "spirit of control" surfacing within FairTax, where we sheepishly wait for "permission" to act, that has an effect of a brakeshoe to the grassroots movement. Everywhere I look there are Americans who are Mad as H---, and doing things with hundreds of boots on the ground. but some of us are still busy setting up booths. April 15th is going to be a great kick in the A-- for FairTax, but not so much as the July 4th march, in several cities simultaneously, and soon up Pennsylvania Avenue.

IF FairTaxers fail to take their rightful place in these marches, we only pave a path for "other tax plans" that will NOT WORK. Get UP, Get Educated to what's going on, and Get OUT there, to LEAD these maddend masses. 90% of them don't know what they want, and if WE don't tell them, it will derail Fairtax, perhaps forever. NOW is the time, to show them the "premiere" tax plan that will cure the ills they can discern, yet not define.

DO NOT wait for an official FairTax "sanctioned" event, with all the Who's Whos to WOW you! YOU are the FairTax! YOU get downtown on April 15th, and lead them in the way they should go. YOU promote other marches in other cities, and YOU fill the web with your presence (as well as your personal presence).

Some of these groups protest the Fed, or free elections, and even the right to assemble: Pay no mind of what issue they shout about, they're shouting for YOU to guide them. BE THERE with your banner, and they will appear as a FairTax army behind YOU! NOW is critical mass, and it's erupting all across this land! If you don't see it-- you just missed it.

Gary R. Anderson

GREAT U-TUBE FAIRTAX COMMERCIALS

2009-02-09T16:24:00.000-08:00

Here are some great FairTax commercials shown on U-Tube, produced by Paul Wizikowski, a FairTax supporter. They are very short and really make their point. I wish we could see them on Network TV:

FairTaxHub "Less" : http://www.youtube.com/watch?v=se7-smPLydI

FairTaxHub "Collected": http://www.youtube.com/watch?v=7JGj85npt-c

FairTaxHub "How Much?" http://www.youtube.com/watch?v=k3OaIA_Of1s

FairTaxHub "Her": http://www.youtube.com/watch?v=SBUkeiTX4Ek

FairTaxHub "How it works": http://www.youtube.com/watch?v=D2yt5gQsmHg&feature=channel_page

If these links don't work, let me know and I will contact Paul to see how I can do this better. THESE ARE GREAT!

NEW SECTION OF HR25

2009-01-16T08:16:00.000-08:00

SEC. 401. ELIMINATION OF SALES TAX IF SIXTEENTH AMENDMENT NOT REPEALED.
If the Sixteenth Amendment to the Constitution of the United States is not repealed before the end of the 7-year period beginning on the date of the enactment of this Act, then all provisions of, and amendments made by, this Act shall not apply to any use or consumption in any year beginning after December 31 of the calendar year in which or with which such period ends, except that the Sales Tax Bureau of the Department of the Treasury shall not be terminated until 6 months after such December 31.
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This is supposed to make our Congress more comfortable with the FairTax, which we sorely need this year to get us out of this horrible economic hole they have gotten us into. This has been a bi-partisan effort to bring our country down economically and make us more dependent than ever on "government". Now let's "hope" for a bi-partisan effort to boost our economy back up and make it more prosperous than ever, with the FairTax.

Keep on writing, calling or faxing your congressman until they finally get the picture - it's not about them, it's about the economy. And about the survival of our country.

MAKE SOME NOISE

2009-01-06T13:32:00.000-08:00

I just read about the Grassroots Freedom Rides, a motorcycle group who is touring the country to promote the FairTax

You can make a pledge to contribute so much per mile and 80% of the collections will go to support the efforts of Fairtaxers all over the country to help them in their efforts to inform and enthuse the public about the FairTax. Following is a portion of their Mission Statement from their website.

Mission Statement
To generate enthusiasm, give a voice and fund raising assistance to grass root supporters in the FairTax movement throughout the nation, through motorcycle enthusiasts and those who support them. We seek to "Make Some Noise" so that we're heard throughout the USA. We seek to synergize the time, talent and treasure of FairTax grass roots supporters by organizing a financial support system for the great ideas generated by this wonderful group of people to educate their fellow citizens about the FairTax.

Please visit their website to view the rest of their mission statement, pictures of their motorcycles, etc. and how to make a pledge to this worthy cause.

THE FAIRTAX IS NEEDED NOW

2008-12-05T20:04:00.000-08:00

The FairTax is needed NOW, to dig us out of this economic morrass. It would solve our economic problems, put Social Security and Medicare back on solid ground, bring trillions of dollars in off-shore money back to America and solve the problems of corporate America, including unemployment.

I don't want to see our country become a third world country because Congress turns up its nose at "change". "Change" to the FairTax and their will again be "Hope."

TRANSITION FROM INCOME TAX TO FAIRTAX

2008-08-08T11:43:00.000-07:00

Below is an excerpt from an e-mail from a FairTax volunteer:

Under frequently asked questions on the FT website, the question "What do we experience in the transition from the income tax to the FairTax?" is No. 46. The reply is:

Everyone will have to think about taxes in a different way. Income -- what we earn -- no longer has to be documented, measured, and tracked for tax purposes. The only relevant measure of our tax liability is the amount we choose to spend on final, discretionary consumption. Tax-related issues are suddenly a lot simpler and more straightforward than they used to be. The aggravation and anxiety associated with “April 15th ” disappears forever after passage of the FairTax. The FairTax is not new -- most Americans come into contact with sales taxes daily, since 45 states currently use them to collect state revenues. It is easier to switch from an income tax to the FairTax system than it is to switch from gallons to liters, or from feet to meters! Of course, those who depend on the structure and complexity of our current system (e.g., tax lobbyists, tax preparers, and tax shelter promoters) will have to find more productive economic pursuits. However, everyone will have enough advance notice to adjust to the new system.

Job creation booms. Residential real estate booms. Financial services boom. Exports boom. Retail prospers. Farming and ranching prosper. Churches and charities prosper. Civil liberties are enhanced. In short, it is difficult to imagine the far-reaching, positive effects of this change. Though this tax policy is exactly what our Founding Fathers counseled us to do with the Federalist Papers and the Constitution.

IT'LL NEVER HAPPEN? I THINK IT WILL..........

2008-07-12T19:28:00.000-07:00

This was presented to the East Tennessee Libertarian group on May 13th. It was an adaptation of an article by our own John Linder. Perhaps this will help some of you in presenting the FairTax.

Upon telling folks about the FairTax bill, they frequently say, “It’ll never happen.” This has been the common reaction to every big idea ever proposed in the history of man. If the FairTax plan is such a great idea, if it is much needed, then why will it never happen?

Have we become so cynical that we cannot believe that much-needed change is possible?

Have we come to accept the current tax code as a permanent, immutable part of our lives?

The FairTax bill would repeal all corporate and individual income taxes, payroll taxes, self-employment taxes, capital gains taxes, death taxes and gift taxes. They would be replaced with a revenue-neutral, 23% personal consumption tax. Americans would receive their entire paycheck. They would have the power to choose exactly when and how much to pay in taxes. It is in keeping with Libertarian thinking that all taxes should be voluntary and that government should not have the power to confiscate our earnings.

The FairTax achieves this by offering to every household of American citizens a tax prebate. The prebate will amount to 23% of the money they spend up to the poverty level. Families that spend only to buy basic necessities will be tax free because the prebate will cover their taxes every month. When a rich man decides to buy a new private jet 23% of the purchase price will enter the federal treasury. America will return to taxing wealth instead of wages.

There are many reasons why changing the way we fund our federal government is necessary. Here are three of the most compelling:

1) Our current code is taxing American businesses into a severe disadvantage in competing in the global economy. Because of corporate, personal and payroll taxes our businesses have a 22% embedded tax in every good they produce. Foreign goods do not have this burden and so have a leg up on American industries. The FairTax will give our industries the best business cost structure in the world.

2) Our current code punishes productivity. On average, Americans lose 33% of their wages to taxation. The FairTax will unleash the power of the American worker and greatly increase their spendable income.

3) Our current code violates the right to privacy of Americans. The FairTax will restore the privilege of anonymity long cherished but long denied. Under the FairTax, there will be no more IRS and no reason for the government to know how much you earn and how you spend it.

Change should be a no-brainer, but the current system is perceived as a constant that has always been and always will be. The reality is that following the 1894 Supreme Court decision declaring an income tax unconstitutional, it took politicians 19 years to contrive and have ratified the 16th amendment in 1913. Subsequently, Congress adopted a simple tax code that permitted only a small flat tax on the very wealthy. This was the beginning of the monstrosity of a code that suffocates American liberty today.

We can only wonder how many people in 1894 when they heard the idea of an income tax said, “Bad idea, but it’ll never happen.” How many people hearing in 1895 that all senior citizens would be provided a government pension said, “Great idea, but it’ll never happen.” The Social Security program we have today began in 1896 as the Civil War Pension program. As all entitlement programs are wont to do, it grew and evolved until it was signed into law as the Social Security Act in 1935.

The FairTax bill was introduced in Congress in 1999. It is a big idea and big ideas take time to establish. Gaining momentum is the greatest challenge to the enactment of the FairTax bill, and there is no greater momentum killer than Congress. The only antidote to the failure of Congress to act is to let them know the will of the overwhelming majority of American voters. In just nine years, a grass-roots force of over a million FairTax supporters has been mobilized. FairTax rallies of over 10,000 Americans have been held, and 72 members of Congress have been persuaded to co-sponsor the FairTax bill. Most Americans have not heard of the FairTax bill and most politicians probably have not read the bill. Only by spreading the word on it will the FairTax bill be passed.

Ronald Reagan touched on the greatness of our country when he stated that the American people have always had the capacity “to do whatever needs to be done to preserve this greatest bastion of freedom.” We will do this; we will do it because we must if we are to preserve the greatness that generations before us created. In closing, to those of you out there who say, “great idea, it will never happen,” imagine the dinner table talk when John Kennedy told America we were going to send men to the moon.

THE SAME OLD DIVISIVE POLITICS

2008-06-29T17:53:00.000-07:00

An excellent picture of what is going on today with politicians and taxes, submitted by a FairTax Volunteer:

POLITICIANS ONLY GIVE LIP SERVICE TO TAX REFORM

“There you go again.” At a recent presidential debate, this statement made famous by Ronald Reagan, should have been directed to both Senator Obama and Senator Clinton when each of them spoke of changing the tax code to penalize some groups and give relief to others. Both were campaigning on the promise of unifying Americans and changing the way business is done in Washington DC. As far as promoting unity, using changes in the tax code to favor one voting bloc while punishing another is a divisive tactic which has long been a staple policy of the Washington DC establishment. Thus, in one breath they champion unity and change and in their next they propose doing business the same old way. Witness the fact that our congresses have made some 16,000 changes in the tax code in the last 24 years! These changes have simply been a “carrot and stick” approach by republican and democratic legislators to win votes and increase their power to control their constituents. Obama and McCain have proven themselves by their own proposals, viz. change the tax code, to be part of the same old approach to solving America’s problems. If they were sincere they would promote the passage of the FairTax bill. This would unify Americans under a system that would eliminate income taxes and the 16th amendment. This system would fund the government at its current or higher level and be simple, transparent, and fair to every American. We need to demand that all of our candidates and congressmen first educate themselves and their constituents on the FairTax bill and then take a stand on it. All of our legislators need to make a fair and truthful evaluation of the FairTax Bill and stop giving only lip service to tax reform.

Imagine what a boost the American economy would experience if taxpayers were handed a virtual $400-billion-per-year tax cut! This amount of extra money in our pockets would work to grow the economy. Further imagine that even with this virtual tax cut, the government would continue to be funded at its current level. The treasury would merely have to collect federal taxes by a simpler, more transparent, and fairer system than that of our current tax code. The Fair Tax bills before Congress would replace the IRS with just such a system.

To look at the money spent just to comply with the current tax code from the point of view of its purchasing power, I will quote the report of President Bush’s Advisory Panel on Federal Tax Reform published in late 2005. The report states that the money spent by Americans filling out their tax forms would fund “the Department of Homeland Security, the Department of State, NASA, the Department of Housing and Urban Development, the Environmental Protection Agency, the Department of Transportation, the United States Congress, our federal courts, and all of the federal government’s foreign aid.”

This same advisory panel noted that widespread noncompliance costs each honest taxpayer an extra $2000 in taxes yearly. It further notes that due to the arbitrariness of the code increasing your income by 50% can increase your tax burden by 140%. It shows that marginal income tax rates can now rise over 30% for a family earning just $30,000 per year. That’s does not include the 15% payroll tax. A 45% marginal rate on a $30,000 yearly income is happening today! This comes straight from the advisory panel experts. Who in his right mind can prefer the current system to the 23% Fair Tax?

THE COST OF PAYING INCOME TAXES

2008-06-24T19:08:00.000-07:00

This came from a FairTax Volunteer - a good read and the hard truth...............

American tax payers bear a financial burden over and above what they pay in federal taxes. This extra burden consists in covering the tax gap and both the time and money spent to comply with the tax code. For 2001 alone the 130 million Americans who filed tax returns paid on average $2,649 extra to fill the gap created by Americans who did not pay their share. This means that the tax bills paid could have been 32.1% LOWER! These 130 million compliant tax payers paid on average $8,265when they should have paid only their fair share of $5,616.

The compliance burden hangs like a huge stone around the necks of all tax payers. It consists of all the time and money wasted on filling out forms, maintaining records, studying tax rules and other tax-related chores. Since 1913 the tax code has grown from 400 pages to over 67,000. In 2005 individuals, businesses, and non-profits spent 6 billion hours and over $265.1 billion to comply with the tax code. The hours spent represent a work force larger than the combined populations of Dallas, Detroit, and Washington DC and more than the total of workers employed in the auto, computer manufacturing, airline manufacturing, and steel industries.

Compliance costs are very regressive, hitting the poorest hardest. Adjusted gross incomes of less than $20,000 pay 5.8% of income while those of over $200,000 pay only 0.45%.

Small businesses bear an unfair burden in compliance costs. As far back as 1991 corporations with under $1 million or less in assets (90% of all corporations) paid $382 in compliance costs for every $100 they paid in income taxes. Corporations with $250 million or more in assets paid about $3 in compliance costs for each $100 paid in income taxes. In 2004 the average American business taxpayer spent $894 per employee on tax compliance activities, but small employers (less than 20 employees) spent $1,304 per employee.

The compliance costs for the private sector are 30 times what the compliance expenses of the IRS are.

The FairTax plan in Congress would slash compliance costs. It would decrease the number of tax filers by 80%. The replacement of the income tax with a national retail sales tax would reduce compliance costs by 95%. This would reduce the cost of doing business and lower the prices of goods while enabling businesses to hire more workers and pay higher wages. It is a cruel hoax when politicians say they are going to raise taxes on businesses. The result of this is to decrease employment and wages and raise the prices businesses charge to the consumers of their products and services.

WHO GETS THE FICA DEDUCTIONS? EMPLOYER OR EMPLOYEE?

2008-06-20T12:22:00.000-07:00

Here is some interesting correspondence between a couple of FairTax Volunteers:

I have always been assuming that we would see a 7.5% increase in take home pay with the FairTax due to no personal deductions for Fica and Medicare. The employer would seem a reduction in payroll costs of the same amount for their contribution as well as unemployment.

I see detractors saying that the employees would see a reduction in their wages. Are they considering the employer contribution to be part of the employees "wages" instead of a tax the employer pays?

Daniel P. Alston, DDS, PC

Dan,

I agree with your assessment (we will get a 7.5% increase in take home pay)
at least for the short term after the FairTax goes into effect.

There is no feature of the current FairTax Bill that would compel any other outcome.
Without such a feature both the employer and employee will get to keep their respective portions of FICA and MediCare taxes as well as the Income taxes.

Employers will try and keep the eliminated taxes as additional profits, however market forces will drive them to cut prices the 5% or so that these taxes add to the selling price of their products.

The mythical 21% price deduction that Neal Borts talks about so much relies on
the business keeping all of the tax reductions of both the business and the
employees. That flat out will not happen. We will have more money in our pockets
that we will need to spend to pay the FairTax added on to the slightly lower prices.

It's not a Free Lunch. Most people will end up with nearly identical standards of
living(consumption). Some at the low end of the income scale will benefit some
will pay more. Those that have no savings and are living hand to mouth will benefit
due to the prebate. Those that are living well off of savings and have no income
will likely pay more (the retired Rich). The retired living modestly with some savings will not be affected much due to the gross up in SS benefits and Prebate. Those currently borrowing to finance an extravagant lifestyle (currently tax free) will be hit hard by the FairTax. High earners accumulating wealth by saving and investing will benefit most.

I believe these effects are as they should be protecting the weak, rewarding the builders and punishing the takers.

Ron Woodward, PE
Yorktown, VA

WAKE UP AND SMELL THE TAXES!

2008-06-16T10:23:00.000-07:00

Or should I say "Wake up and SEE the taxes?" The following is from a FairTax Volunteer and really lays out the "hidden taxes" we pay in addition to income and payroll taxes. A good eye-opener:

Federal income taxes represent only 42 percent of the total tax burden of U.S. taxpayers. The remainder is hidden, distorting taxpayers’ awareness of their real tax burden and of the true cost of government. Only fundamental tax reform with an emphasis on visibility can ensure a fair tax code that allows taxpayers to evaluate whether they are getting their money’s worth from government.

Despite all the attention given to federal income taxes, they represent only 42 percent of the total tax burden Americans carry each year. There is at least $657.5 billion in additional “hidden” taxes—$2,642 per person—that is not visible to the taxpayers. If more Americans realized that their total tax burden equaled 56 percent of annual personal consumption spending, there might be a second Revolution.

Unlike sales taxes that appear on a cash register receipt, hidden taxes are those charges that are not expressly clear to the taxpayer. One example is fuel. The average price of a gallon of gas last August was$1.49 and 43 cents of that amount represented taxes. That 37% tax rate does not appear on your receipt. In recent years fuel taxes have become the fastest-growing federal tax imposed on middle-income Americans, amounting to $220 a person.

“Sin” taxes are also great sources of revenue. For instance, tax revenues from liquor are many times higher than the total profits of distillers. Nearly half the cost of a six-pack of beer is tax, and cigarette taxes alone will generate $45 billion through fiscal year 2005.

There are also hidden taxes on a litany of products and services ranging from inoculations to firearms to travel expenses. Almost half the cost of an $80 hotel room is tax as is 40 percent of a $159 airline ticket. And the typical monthly utility bill includes 25% tax. With the rise in telecommunications subsidies and Internet commerce, Americans will be feeling—but not necessarily seeing—even more of a tax bite.

Not all taxes are hidden in the cost of goods and services. Some are even more surreptitious. Payroll taxes, including income tax withholding, “employer share,” and unemployment and workers’ compensation taxes not only mask the true burden of paying taxes but also raise the cost of hiring workers, which in turn actually lowers wages and conceivably threatens jobs.

Payroll taxes have increased dramatically since 1937. Today over 90 percent of American workers pay more in payroll taxes (including the “employer share”) than they do in income taxes. Just since 1977, the payroll tax rate has grown by nearly one-third. And when combined with other mandated labor costs such as unemployment insurance and workers’ compensation taxes, the resulting burden actually raises the cost of hiring workers, lowers wages, and can even eliminate jobs.

When taxes are not visible, Americans are unable to evaluate whether they’re getting their money’s worth from the government. While not every hidden tax is responsible for every inequity contained in our current tax code, hidden taxes do contribute significantly to the most complex and inherently unfair system of taxation ever placed upon the American public.

Tax overhaul is imperative, but the fundamental focus of any reform must be on visibility. That’s because a hidden tax is an unknown tax, and an unknown tax is one that cannot be evaluated and judged by those who pay it. In the end, the consumer is left to wonder, How much tax did I really pay? - Read Full Report!

Source: http://www.ipi.org/ipi%5CIPIPublications.nsf/PublicationLookupFullTextPDF/3F31DF6F0D040EE986256AB700630B84/$File/PR160-HiddenTax-FINAL.pdf?OpenElement

This report makes me want to use fowl language!

TAX FREEDOM DAY IN NEW YORK

2008-05-30T19:36:00.000-07:00

This letter came from a FairTax Volunteer in New York:

Good job! The Saturday before NY states "Tax Freedom Day", I was on a local station in Geneva, NY, WGVA 1240. Not nearly the number of listeners, however the listeners in this area of the state are fed up with payroll/income taxes, too.

My focus was on CONTROL OF OUR PAYCHECK!! By doing away with payroll taxes, the money is in OUR HANDS FIRST. Who holds the money, holds the power. Politicians have to listen to our positions on crucial issues, or we can stop BUYING and limit the tax revenues!

Prior to and during the American Revolution, the Patriots used "boycotts" to pinch the British. Our government eliminated this power with payroll tax legislation.

Taxes are economic chains of tyranny. If we have a national sales tax, and the federal government raises the tax rate without our support, consumers can reduce their purchases to slow down the flow of taxes to the Treasurey. We don't have that power now.

It is OUR GOVERNMENT, WE THE PEOPLE! The "ruling class of regulators" are out of control. Get rid of payroll/income taxes, give control of money back to the people, and watch how "FairTax Freedom" gives "true power" back to the people of the United States of America.

Spread the word,
Armand Marianetti
FairTax Freedom Volunteer, NY 29

WE NEED THE FAIRTAX NOW!

2008-05-08T18:53:00.001-07:00

I obviously am not writing on a daily basis anymore. My husband is ill and my thoughts and deeds lie with him right now. From time to time I will pass on a letter from my correspondence with other FairTax supporters. Also, please read my earlier blogs. They give a simplified version of the FairTax without the extra words that go into padding an article or a book. Fast, easy reading. Feel free to comment.

The following is from a FairTax supporter regarding an article in the newspapers:

Fair Tax proposal

Regarding "Experts predicting rise in tax rates" in the April 10 Huntsville Times: The 2007 Congressional Budget Office analysis says the income tax rate would have to almost double in order to meet Medicare, Medicaid and Social Security requirements through 2050,under the current tax structure.

This is consistent with the report by trustees of the Social Security and Medicare funds.

Medicare will start negative spending in 2008 and be depleted by 2019; corresponding
dates for Social Security are 2017 and 2041, according to the March 26 Huntsville Times article titled "Social Security, Medicare face big challenges."

Further, according to an April 10 Times article, the International Monetary Fund says
America is headed for a recession.

However, since 1999, Congress has failed to act on the Fair Tax bill, HR 25, the best
solution for stimulating the economy and truly fixing our tax code.

The Fair Tax replaces federal income and payroll taxes including: personal income,
estate, gift, capital gains, alternative minimum, Social Security, Medicare,
self-employment and corporate taxes.

It is a single-rate, federal retail sales tax collected only once: at the final point of purchase of new goods and services for personal consumption.

The principles were developed by professional and university economists and accountants based upon $22 million of research, not by politicians.

(See "FairTax: The Truth,"by Neal Boortz and John Linder, or www.FairTax.org.)

I urge each reader to investigate the Fair Tax, come to some conclusions, and take the appropriate action.

Bobby L. Austin,

Huntsville, 35806

Scroll down for the article, please.
http://www.al.com/opinion/huntsvilletimes/index.ssf?/base/opinion/1210151747111100.xml&coll=1

TODAY COULD BE "JUST ANOTHER SPRING DAY"

2008-04-15T13:02:00.000-07:00

Have you noticed how few news items there have been in recent days about "Tax day"?
Not a word from any of our presidential candidates, newspaper editors, opinion columnists, nobody!

I know I exagerate, but that is how is seems to me. You would think the presidential canditates would at least have something to say about taxes, but I really didn't expect it. They haven't said or done anything but make our tax situation worse every year.

I realy do miss Mike Huckabee. He was extremely vocal about how broken our income tax system is and he also presented a solution: The FairTax.

By the way, Mike Huckabee has a new website, dedicated to "life, liberty and the pursuit of happiness". Check it out at www.huckpac.com. Hopefully he will continue to make a difference by promoting the FairTax.

I hope you or your accountant finished your taxes on time. Mine didn't. We had to cancel an appointment because of illness, sent our tax info to him, and he ignored us in favor of those who saw him in person. Next year is Turbo-Tax year for me!

Bah, humbug!

96,000 NAMES ON FAIRTAX PETITION!

2008-04-08T12:41:00.000-07:00

The following letter is from Ken Hoagland, Communications Director for www.fairtax.org. If you haven't signed the petition yet, please do so today. The FairTax people will be delivering it to Congress on April 15th to show grassroots support for the FairTax and the need to pass it soon:

Dear FairTax supporters:

Wow! We are close! I mean really, REALLY close!

We now have over 96,000 signatures, and need just 4,000 more to hit our target of 100,000 names for our "Pass the FairTax" April 15th petition. Please take a second and help us surpass that goal today.

We know you care about the FairTax, so we'll hope you'll take this last opportunity to add your name now at www.changedc.org and help us hit our 100,000-signature target. As you know, this is a critical time for the FairTax and every voice--especially yours!--counts. So please take a second, make a difference, and help us change DC this tax season.

As you know, we'll be delivering a copy of this petition and 100,000 names to Congress and the leading presidential candidates on April 15th. By signing now, you'll be there too and reminding our elected officials in Washington that demand for the FairTax is growing, and that real change is coming to Washington courtesy of engaged citizens just like you.

Again, thanks for your help during our April 15th "Pass the FairTax" petition. We, literally, could not do this without you!

Sincerely,

Ken Hoagland
Communications Director

HAVE YOU FINISHED YOUR TAXES YET?

2008-04-07T10:28:00.000-07:00

Now that we are down to the wire for this April 15th and you probably have good numbers ready, try out Marlene Tobin's FairTax Calculator at www.fairtaxcalculator.org

You can readily determine your effective tax rate.

After that, find the petition and sign that, to show your support for the FairTax.

After that, "read The FairTax Book" or go to www.fairtax.org and read the basics of the FairTax. Or check out my earlier blogs for shorter explanations of the FairTax.

Write or call your Senators and Representatives in Congress to ask their support for the FairTax.

We FairTax supporters need to do all of this, frequently, to show we are serious about Congress changing the tax code to save our economy, social security, medicare and US.

IT’S THREE A.M.

2008-04-03T14:40:00.001-07:00

and your phone rings. It’s the IRS demanding your taxes be paid by April 15th. Are you still working on yours? I am. Or at least, my accountant is. We all will have paid approximately $251 billion by the end of the tax year just to figure out and conform to the many IRS rules and regulations.

We ALL have to file taxes this year if we expect to get our “rebate” from the Federal give-away program. That means much more than the estimated $251 billion will be spent just so we can get that “rebate”.

But wait! That rebate could mean something else besides just getting a hand-out. It could prove that the Federal Government is capable of handing out “pre-bates” if the FairTax were enacted. Just think – by the end of this year, they will have it all figured out just how to do this.

And then, all they have to do is vote in the FairTax (HR25 & S1025), already in committee, co-sponsored by over 70 congressmen and just sitting there waiting for the Government to finally do something about our economy.

Go into www.fairtax.org and sign the petition to get this bill moving. We need lots and lots of signatures to show Congress we mean business. Our country won’t be free much longer if we don’t do something about our economic future. And if our country isn’t free, neither will you be free. Think about it.

LET'S GET RID OF THE INCOME TAX MESS

2008-04-01T19:45:00.000-07:00

Below is a piece written by the National Communications Director of the FairTax.org. It is rather long, but a good read.

The Income Tax Mess
By
Ken Hoagland

This year American businesses and individual taxpayers will, astoundingly, pay more than $265 billion in tax preparation costs just to comply with our nearly indecipherable 67,500 pages of income tax regulations. Although universally despised, the income tax system has, for all the wrong reasons, strong defenders in Washington.

The income tax is big business in Washington. More than half of all lobby expenditures in any given year are devoted to winning tax code breaks. While Republicans and Democrats disagree on almost everything else, in Congress they are equally enamored of manipulating the tax code. Providing special breaks for favored constituents, punishing political opponents and affecting the behavior of citizens is pursued with equal vigor on both sides of the aisle. The process has created a complex mess.

Warren Buffet and other American millionaires and billionaires will pay a lower tax rate again this year than their secretaries. If you are married, you will pay higher taxes than two people living together. If you continue working while collecting Social Security, your benefits will be taxed. If you are an American business, “embedded” income and payroll tax costs will account for as much as 20 percent of the price of your goods and services.

These costs and the highest corporate tax rate in the world make American products are far less competitive both here and abroad. Our income tax system has actually helped drive more than $12 trillion of American wealth offshore in recent years.

But if you happen to find a job on the House Ways and Means Committee, the Senate Finance Committee or the Joint Committee on Taxation as either a staffer or, better yet, an elected representative, you have a bright future with the tax code. Seven figure signing bonuses are not uncommon when “K St” tax lobby firms are looking for talent and connections. Is it any wonder that taxpayers hear frequent promises that “something must be done” but that the tax code only gets more complex, unfair and dysfunctional?

The difference between what is owed and what is collected by the IRS is about $350 billion and will result in average tax bills being about $2,000 higher than they would be otherwise. Many middle class taxpayers would have been hit with an additional $2,000 tax this year if not for another one-year legislative “patch” of the 1969 error of the tax writing committees in not indexing the Alternative Minimum Tax for inflation. While every eligible taxpayer is looking forward to welcome rebates this year, the money to stimulate our economy is, in fact, borrowed from China and other lender nations. There is a better way.

The most viable alternative to the current system remains the FairTax, a progressive national consumption tax with 70 Congressional co-sponsors and a growing citizen base clamoring for change. Unlike the current system, it taxes the $1.5 trillion underground economy, transforms twelve million illegal immigrants into taxpayers as consumers, and ends the marriage penalty, the corporate tax, the capital gains tax, the inheritance tax and all income and payroll taxes.

It eliminates all federal taxes on the poor, gives the middle class a healthy tax break and taxes billionaire’s spending at an equal level. Every wage earner takes home their entire (federal withholding free) paycheck under the FairTax.

It also provides a far broader base of revenues into the faltering Social Security and Medicare programs. Most experts concede that adoption of the FairTax would stimulate trillions of dollars of foreign investment into the US economy but for predictably self- interested reasons the tax lobby hates the FairTax despite its clear benefits to the nation.

Even without prominent FairTax advocate and Presidential candidate Mike Huckabee on the campaign trail and despite blatant distortions from Washington, the national FairTax campaign continues to grow at the grassroots level. Like all citizen driven reforms, it is building toward the day when enough taxpayers can finally overcome Congress’ self-interest in their favorite plaything, the cause of our annual tax torture and a millstone around the neck of our economy.

EDITORIAL: WHY WE NEED A DIFFERENT TAX

2008-03-27T20:08:00.000-07:00

This editorial is from the Albany Democrat Herald in Albany, OR. This editor has obviously read The FairTax Book and is ready for a change. He brings up a very good point: Why are the Presidential candidates not addressing our flawed income tax system? Now is the time!

Editorial: Why we need a different tax.

The tax-filing season is revving up to its nail-biting conclusion in less than three weeks. So you would think voters would demand that federal candidates, especially for president, speak about their plans for relieving Americans of this annual ordeal.

But the voters don’t ask, and if the candidates have any such plans, they are keeping mum. No one who actually reads the federal tax instructions can believe that sane people wrote the laws on which they are based. Maybe the trouble is that more people don’t read them, which they can avoid doing by filing a simplified return or having their returns done by a pro.

So one idea for reform would be a requirement that every voter read at least the instructions for Form 1040 and pass a test. After all, the voters are responsible for sending to Congress the people who are responsible for the laws — either by writing them or refusing to change them — that form the basis of the instructions.

But that’s assuming that the present system is worth keeping, which plainly it is not. It’s not worth keeping not only because it demands that you file a return and go through all kinds of contortions, in terms of record keeping and computations, in order to meet the requirements of the law. If that doesn’t amount to involuntary servitude, name something that does.

The system also leads to wide discrepancies in what people owe, owing to peculiar circumstances. Savings are required for long-term economic health, but savings are taxed, and so are any earnings from savings. And perhaps worst of all, even though from some people it confiscates enormous sums, overall the federal tax system does not raise nearly enough money to cover the outlays that Congress continues to approve.

We need two things to reset the balance. Even though the idea has not been seriously mentioned in a decade or longer, we need a requirement that government spending be limited to roughly the same as income every year. And we need a tax system that collects the necessary revenue without the need for filing returns.

Whether we call it a sales tax or a value-added tax, or even a “fair tax,” some universal consumption tax like that would fill the bill. (hh)

EXEMPT FOOD & MEDICINE FROM FAIRTAX? GET REAL!

2008-03-24T11:18:00.000-07:00

A FairTax volunteer e-mailed this article - a must-read................................

Why not just exempt food and medicine from the tax? Wouldn’t that be fair and simple?

Exempting items by category is neither fair nor simple. Respected economists have shown that the wealthy spend much more on unprepared food, clothing, housing, and medical care than do the poor. Exempting these goods, as many state sales taxes do, actually gives the wealthy a disproportionate benefit.

Also, today these purchases are not exempted from federal taxation. The purchase of food, clothing, and medical services is made from after-income-tax and after-payroll-tax dollars, while their purchase price hides the cost of corporate taxes and private sector compliance costs.

Finally, exempting one product or service, but not another, opens the door to the army of lobbyists and special interest groups that plague and distort our taxation system today. Those who have the money will send lobbyists to Washington to obtain special tax breaks in their own self-interest. This process causes unfair and inefficient distortions in our economy and must be stopped.

OBAMA NEEDS THE FAIRTAX

2008-03-21T12:15:00.000-07:00

I listened to Obama's speech in Oregon today and determined, with the "new social order" he is touting, that he will need the FairTax in order to keep his constituents. Otherwise, everyone will go broke just trying to pay for all his largesse.

He plans to "give" us all health care. Who does he think will be paying for it? WE WILL! Remember, Corporations do not pay taxes - we do, in the form of higher prices. And where in the Constitution does it say "life, liberty and pursuit of health"?

He plans to "give" all students $4,000 (is it per year or per term? I forget) to help with their higher education. Who does he think will be paying for it? WE WILL! Oh sure, the students will be "required" to do community service, but it is still a huge money drain. Let the prison inmates do the community service and let the students work for their education.

He plans to have our troops home by 2009. Who does he think will be suffering for it? WE WILL! With more lives lost when the Al Queda come to our shores.

He plans to "fix" Darfur. Who does he think will be paying for it? WE WILL! Obama will pull our troops out of Iraq and put them right into Darfur, mark my words. It is all a matter of whose war it is. Remember "Wag the Dog"?

I could go on and on, but you get the picture. You don't get something for nothing. Obama is planning to take charge of all of your dollars, not just your tax dollars. He is planning on re-distributing the wealth of this country - not to you, not to me, but to control our every thought and deed. BE AFRAID - BE VERY AFRAID!

NOW LET'S SEE WHAT THE FAIRTAX WOULD DO FOR OBAMA - AND FOR US!

First, health care. With the FairTax, the working people would be able to afford their own health care. After all, they will have 100% of their income to choose the kind of health care they want. The people who don't want health care will not be forced to have it. The poor people who work will have more take-home pay to pay for it. The poor people on welfare will be taken care of with their prebate checks and social services already in place. The older people on Social Security will still be covered by Medicare, low-cost supplemental insurance and prescription drug coverage. That's called Freedom, my friends - Freedom of Choice. If the Government takes your money to spend as "they" see fit, you are no longer free.

Next comes education. Nobody owes you a living. Nobody owes you an education beyond high school. If Obama allows the FairTax, parents can educate their own children without paying a FairTax, which means they will be able to afford to educate their children the way they want to, with 100% of their income. Also, if the students work to help with their education, they will be able to save more money or spend less in student loans. That's called Freedom, my friends - Freedom of Choice. If the Government takes your money to spend as "they" see fit, you are no longer free.

The next two items - The Iraq War and Darfur - have nothing to do with the FairTax. However, it has everything to do with Freedom. We freed the Iraqi's and now we are trying to keep them free long enough to stand on their own two feet. By pulling the rug out from under them (bringing home the troops in 2009), would surely spell defeat for us and defeat for the Iraqis. And would it make us safer? NO! We would have them bombing our malls and our sports stadiums and our schools because by bringing home the troops too soon will bring the enemy right along after them. The troops are fighting for our freedom, my friends - Freedom of Choice.

Saving Darfur sounds very humane - and it is. However, saving Iraq is not? I don't get it. Saddam Houssain tortured and killed his own people, just like what is happening in Darfur. We can't save the whole world. UNLESS - well, I can't help thinking that the FAIRTAX would bring companies back to our shores, bring new money to our shores, bring off-shore money back to our shores, bring JOBS back to our shores. Everyone would prosper from this - not just big business. I have never understood why people are so against big business, when that is where your paycheck is coming from. Why bite the hand that feeds you? Freedom, my Friends - Freedom of Choice.

With the FairTax, you will be free to save, to invest, to educate yourself, to choose the type of health insurance you want, not what the government decides to dole out to you. You will also be free to spend your money how YOU see fit, not how the Government sees fit for you. It's called Freedom, my friends - Freedom of Choice.

THIS COMMENT GETS FRONT PAGE TREATMENT

2008-03-18T17:30:00.000-07:00

Ashford Schwall has his ducks in a row. He has his priorities straight. I was so impressed with his commentary, I simply had to make sure nobody missed it. Thank you, Mr. Schwall!

Ashford Schwall has left a new comment on your post "WILL THE FAIR TAX CREATE AN UNDERGROUND ECONOMY?":

The underground economy is everything from Wendy Waitress not reporting all of her tips to Mr. Cash Money, the drug dealer. Let’s play a little game. Let’s look at both under the income tax and under the FairTax. We will start with a look into the life Mr. Cash Money under the income tax.

Mr. Cash Money sells “medicinal items” for cash on the street and takes a “commission” from working ladies. He even provides a “protection service”! Do we think Mr. Cash Money files a tax return every year? Any year? Don’t hold your breath.

Poof, now we are in FairTax land. Mr. Cash Money needs a new suit. Nothing used for this guy! Bam, FairTax paid. Mr. Cash Money needs some groceries, Bam, FairTax paid. Mr. Cash Money needs to pay his rent, Bam, FairTax paid. Mr. Cash Money needs to………..you get the picture, Bam, FairTax paid.

Do you think Mr. Cash Money will expose himself to the Gov’t by applying for the prebate? Again, Don’t hold your breath.

Now let’s look at Wendy Waitress under the income tax. She has been good and filed her taxes, just did not report all of her tips. A bad tax plan made a technical criminal out of a good person. She has worked hard but was never able to get ahead. Her overtime is even taxed at a higher rate.

Poof, now we are FairTax land. Wendy applies for and gets the prebate. She now takes all her tips and put them into savings which are no longer taxed. Her overtime is not taxed. She is frugal and buys used items where possible which are not taxed.

She takes a night course which is not taxed. She gets a better job which is not taxed. Now she is able to buy that new car, dress, shoes or whatever she has always wanted, and yes, it is taxed. But so what, thanks to the FairTax, Wendy has been able to get over that hump of sustenance to success.

So in the grand scheme of things…….. No, the Underground Economy would not be a problem. Perhaps taxing “income tax” can not be more fair. Is taxing income the answer? Where is “written” that income must be taxed to fund our collective gov’t needs?

It has been that way since 1913. Prior to that, various excise taxes were used. Why must we tax income? Some how point number two of the “Ten points of communism” found in the Communist Manifesto has become the norm. Why would we want to?

What are we taxing when we tax income? We tax work. We tax prosperity. We tax upward mobility. We tax success. Many economists believe that if you tax something more, you get less of it.

Do we really want less work, less prosperity, less upward mobility, less productivity and less success?

Ashford Schwall

LEGAL PROSTITUTION - NO! FAIRTAX - YES!

2008-03-14T16:37:00.000-07:00

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)

WE STAND FOR THE FAIRTAX - VOTE FOR IT!

2008-03-10T12:11:00.000-07:00

I received an e-mail reminding me that Mike Gravel, the only Democrat Candidate for President who supports the FairTax, is still in the running. You would never know it by watching and listening to the various forms of Media.

For you Democrats out there whose primaries have not yet been held, you still have a chance to promote the FairTax by voting for Mike Gravel. Here are a couple of youtube sites of Mike Gravel selling the FairTax: http://www.youtube.com/watch?v=E3bY_UNCY_I & http://www.youtube.com/watch?v=UAyY_8hDdfY .

To contribute to his campaign, go to his website: http://www.gravel2008.us/.

It is really discouraging, being from Oregon, to have to wait until everything is decided and then the "powers that be" allow us to vote. Our votes counts for nothing, so we might as well use our votes in protest of the system and to let the public know what we stand for.

We stand for the FairTax - Vote for it!

LISTEN TO NEAL BOORTZ' WEBINAR TODAY

2008-03-06T16:52:00.000-08:00

Sent to me by a FairTax Volunteer:

News/Talk 750 WSB's Neal Boortz is hosting a FREE internet seminar, or Webinar, beginning today, March 6, to explain and answer questions about the FairTax. I just listened to it and it is absolutely EXCELLENT! It is like watching a Powerpoint Presentation with NealBoortz explaining the FairTax.

You can watch/listen to it anytime. It lasts about an hour. I am sending a special e-mail announcement about this WEBINAR out to all of our local FairTax supporters. For more details go to http://wsbradio.com/ads/fairtax_webinar.html or just follow the links from the Home page at www.fairtax.org.

FAIRTAX TRULY NON-PARTISAN

2008-03-03T09:14:00.000-08:00

Below is a letter from Joshua Pritikin, a FairTax Volunteer AND a Democrat. We need more people like him, who takes the time to check out the facts and is not afraid to go with them. If you would like to receive all of the FairTax correspondence, just sign the FairTax petition at www.fairtax.org and sign up as a FairTax volunteer. Here is his letter:

In response to three letters titled "The FairTax and the $50m jet" on 02 Mar 2008: As a registered Democrat, I was pleased to see other fellow Democrats taking up consideration of the FairTax proposal. I prefer the Democratic position on social issues, but the Republicans are ahead of us on questions of taxation.

I realize this may be difficult to understand. It only became clear to me after running the numbers myself. When it comes to questions of public tax policy, I used to avoid the discussion and stick my head in the ground.

The complexity of the current system is mind numbing. But that is where the advantage of the FairTax shows most vividly. It is simple to understand and explain. I was not surprised that letters in response to Prof. Kotlifoff were negative. After all, the topic is taxation. Some diligent study is required.

Both Mr. Laswick and Mr. Depperman pointed out that a wealthy individual who spends little money would pay little tax. They contrasted this case with a middle class earner who must spend (and be taxed) on all of his income. There are at least three additional points to consider.

Firstly, the hypothetical middle class earner will be better off under the FairTax than he is now. He will pay less tax because the sum of the income tax, social security, and medicare taxes amount to more than the 23% FairTax less the prebate. You can verify this with a calculator.

Secondly, while the wealthy keep money in the bank, that money is lowering the interest rate on your mortgage.

Thirdly, this year or next year, the wealthy can afford to buy a new house, new yacht, or new airplane and the prebate is a vanishing offset against a 23% tax on millions of dollars.

Give the FairTax a fair chance. Dust the cobwebs off your calculator. Run the numbers yourself. It is not as difficult as you might expect.--

Make April 15 just another day, visit http://fairtax.org

SIGN HERE TO PASS THE FAIRTAX NOW

2008-02-29T14:30:00.000-08:00

I am sharing a letter from FairTax headquarters for anyone wishing to sign a special petition to pass the FairTax now. They need lots of signatures so read, click and sign. Thanks, Bobbie

Dear FairTax supporters: Our march to deliver 100,000 signatures for our "Pass the FairTax" petition to Congress and the leading presidential candidates has begun, and the response has been intense. In just one week since our launch we've gathered over 30,000 names--including Gov. Mike Huckabee who's signing the petition tonight in Houston!

That's a fine catch, but we still need an equally important one...yours! Take a moment now and join over 30,000 fellow FairTax supporters who've already signed the "Pass the FairTax" petition to send a powerful message to Washington this April 15th!

As we said before, the presidential campaign season is full of talk about changing Washington. Great idea, so let's remind Congress and the leading presidential candidates that real reform in DC starts with bringing the FairTax to reality. Your support here is critical so please help us change Washington by signing now.

We are continuing to spread the FairTax cause to new prospects. We're running our "Change DC" full-page newspaper ads in Texas and Ohio--in advance of their March 4 primaries. That media buy is something supporters like you made happen with your generous financial contributions. Thank you!

The clock is ticking. So please join over 30,000 of your fellow FairTax supporters who've already raised their voice to help us change DC for the better now!

Sincerely, Ken Hoagland
Communications Director

If you would prefer sending a check or credit card contribution by mail, please download and print our contribution form here.

DOES THE FAIRTAX TAX RENTALS?

2008-02-27T15:33:00.000-08:00

I have read a lot of erroneous comments on my blog and today I am re-running an earlier blog explaining the FairTax and rental housing. I am sure I will have many more erroneous comments as a result of this, but I think the neophytes of the FairTax need to know the truth.

One comment disregards the 23% sales tax and calls it a 40% sales tax and has even pushed it up to 100% tax at times. Now this is an hysterical disregard for the truth as the FairTax is written.

If you don't accept the truth, nothing adds up and it becomes a frustrating attempt to distort the truth. If you don't like the FairTax, fine, but don't distort the facts.

As you know, both owner-occupied and renter-occupied housing is taxable under the FairTax. With owner-occupied housing (new), the tax is collected up front at time of sale. With renter-occupied housing (new or used) the monthly rent is taxed as it is collected by the landlord.

Renter-occupied housing under the present Income tax is paid with after-tax dollars. Renter-occupied housing under the FairTax is paid with pre-tax dollars, plus there will be a pre-bate added to the renters income to stretch his/her dollar further.

Since investment property is not taxed under the FairTax, but the rents are taxed, the rental property will not be subject to double taxation.

An example in the FairTax Research information compared the Income Tax structure with the FairTax structure using $500 in monthly rents. With a 15% income tax bracket, the renter would have to earn $647 in order to pay his income taxes and payroll taxes and have $500 left to pay his rent.

Under the FairTax structure, the $500 rent plus the 23% sales tax amounts to $649, $2 more than the income tax in order to cover his rent. HOWEVER, in comes the pre-bate to the rescue! And that renter has only had to use $2 of his monthly pre-bate to pay his rent, leaving the remainder to pay the taxes on his medical bills, dental bills, groceries, etc.

I hope that answers any questions you might have. If not, go to FairTax.org for more information. Read the FairTax bill (HR25 or S1025) yourself. If you don't like what you read, then continue to mire yourself in the 60,000+ pages of the present income tax system and continue to watch our country rot economically.

WHAT'S THIS ALL ABOUT?

2008-02-22T14:52:00.000-08:00

I just ran across this website while reading letters from FairTax volunteers and checked it out. It is a new site without much information, but they seem to have some good ideas, among them the FairTax. They expressed concern that the FairTax bill would not eliminate the 16th Amendment.

I think too much store is put into the elimination of the 16th Amendment. The 16th Amendment allows for an income tax, but does not require it. Let's pass the FairTax bill (HR25 & S1025) first, then enjoy its benefits, and finally, after a 5 year trial period of the FairTax, repeal the 16th Amendment.

I don't know if this website is the beginning of a new political party or a spin-off of conservative Republicans, but it will be interesting to keep an eye on it and see how it evolves.

http://falconparty.com/?p=1

OPPONENTS OF THE FAIR TAX - PUT UP OR SHUT UP

2008-02-21T16:53:00.000-08:00

The following was sent to me by a FairTax Volunteer. It exposes the naysayers for what they are: Do Nothings!

William Gale, The Brookings Institution
Dale Jorgenson, Harvard University
James Poterba, MIT, and member of the President's Tax Reform Panel
Lindy Paul, former chief economist of Joint Committee on Taxation
Bruce Bartlett, conservative columnist and former economist with the Reagan administration
Rich Lowry - National Review
Jay Bookman - Atlanta Journal Constitution
Allen Buckley - Attorney and Libertarian candidate for U.S. Senate
John Suggs -- Ed itor, Creative Loafing Magazine
Robert McIntyre -- Citizens for Tax Justice
Any editor of the Wall Street Journal editorial page

That's an interesting and comprehensive list of FT opponents. I could not help but wonder what the outcome would be if you could get them (plus the author of the article) in a room together and asked them to agree on a tax reform approach which would address

1. the AMT
2. the spiral of complexity and higher compliance costs
3. the crisis in SS and Medicare
4. the trade deficit
5. the federal budget deficit
6. etc, etc

I know that the author has his own version of tax reform which abolishes corporate taxes (except for payroll), the AMT and makes up the revenue somewhere else. That proposal has one supporter that I am aware of - its author. It does not address the issues listed above in any meaningful way.

Then you have Dr Jorgenson, who has his own version of tax reform he calls "the efficient taxation of income" if memory serves. I would be willing to bet that after selling his books for many years and promoting it constantly, he has not more than 100 supporters.

Dr Poterba was on the President's panel which produced a report which was ignored by the White House which commissioned it, the congress which would have to enact it, and the general public. That proposal also basically ignored most of the economic issues enumerated above and contradicted its own interim report, the title of which was " America Needs a Better Tax System". That report was nothing less than a scathing indictment of the current system; it was a summarization of the input they received from the American public.

Jay Bookman is on the editorial board of a newspaper which regularly publishes articles about the economic challenges listed above but consistently fails to address solutions, other than imploring legislators to "do something". That newspaper has opposed the FT, even though it is the most comprehensive and effective way to address these issues.

The WSJ is in Steve Forbes' hip pocket and continues to tout "the flat tax" as if there were a single version of a flat tax that flat taxers rally around. They ignore the fact that "the flat tax" has been around for decades now and is on life support politically. Their only bill in the house is the Burgess bill, which is not revenue neutral and therefore will never be seriously considered by congress and has a grand total of six (6) co-sponsors. "The flat tax", of course, does not address the economic challenges listed above nearly as effectively or comprehensively as does the FT, regardless of which flavor of flat tax one supports.

I could keep going, but here is the bottom line for me. Unless and until the critics of the FT come up with a better way to approach these economic challenges that we face, I will continue to support it. If you put all these guys in a room and told them they could not come out until they reached a consensus, they would all die in that room.

WHY A FAIRTAX WILL HAPPEN

2008-02-19T11:26:00.000-08:00

Below is a reply to the naysayers of the FairTax, from a FairTax Volunteer:

All of the interested parties opposing the FairTax can broadly be defined as " special interests". They represent a small, but highly motivated, number of opponents. Our obligation is to inform and facilitate the wishes of the vast majority of our citizens who cherish liberty, freedom of action, and fairness.

We always recognized the challenge overcoming the special interests. I suspect that there was a higher percentage of people who were comfortable living under the King of England, who doubted the ability of an army of citizen/patriots to defeat the mighty British, and knew we were under financed. If our founders had followed the easy, conventional course, no telling what the world would look like today.

To secure our future, we must recognize the need for reform and act on a course to transform the republic around the principles that are the foundation on which our country is built.I believe the FairTax is transformational.

It seems to me if we acted on the advice of naysayers and special interests polio would have never been controlled and we would continue to do research but never cure cancer. Just imagine how many existing and potential jobs were lost because of the Salk Vaccine. How many jobs will be lost when cancer is cured?

All advances and transformations lead to "retooling" our economy/work force. It is part of "creative destruction. Keep your hopes and effort focused on the goal- it is worth the effort!!!

Respectfully,Leo

IS THE 23% FAIRTAX RATE REALLY TOO HIGH?

2008-02-18T10:51:00.000-08:00

This is an excellent dissertation about the % of taxes paid with the FairTax - and yes, there really are embedded taxes. The following article comes from Tom Wright with the AFFT org.:

I just did my taxes, and after all of my deductions and exemptions, I only paid 14% of my income in taxes. Why is the FairTax a good deal for me?

We get this question all of the time…and it is a good one. Sadly, it is also proof of the problem with our tax code today. The problem is that you believe that you are only paying 14% in taxes…and you have forgotten about the payroll taxes that you pay and the corporate income taxes built into the price of everything that you buy.

Remember, the FairTax is revenue neutral, which means that it is not a tax cut. The FairTax expects that as Americans we will pay just as much in taxes tomorrow as we do today. The only differences will be that (a) we’ll know how much we are paying because it will be visible and (b) we’ll free the economy from the constraints of the income tax so that a rising economic tide can lift all boats.

Let’s imagine that you earn $100,000 (the round number, while high, will make the math easier)…and imagine that after all of your deductions, exemptions and credits, your income tax bill was $14,000, or 14% of your total income.

Now, remember that you also must pay 7.65% for payroll taxes, which is another $7,650. Also, remember that your employer must pay another 7.65% of your salary in payroll taxes (or, if you’re self-employed, you must pay this amount directly). That is another $7,650. Adding these amounts together, you will have paid $15,300 in payroll taxes.

Suddenly, even though you thought that you were only paying $14,000, or 14%, we now see that you’re paying $29,300, or 29%, and we haven’t even calculated the hidden taxes in the price of everything that you buy. This is why the FairTax is a better deal for you.

Today, taxes are hidden so you don’t really know how much you’re paying. Plus, today, for every dollar handed out to someone in a special tax break, tax credit, or tax exemption, the tax bill of everyone else must rise by that dollar. The FairTax will eliminate all of these special preferences, and when those who today receive those preferences start to pay more, you can begin to pay less.

"WEBINAR" ON MARCH 6TH - COME ONE, COME ALL

2008-02-16T15:44:00.001-08:00

Neal Boortz will be hosting a Fair Tax "Webinar" on March 6th. Please check regularly on his website: <http://boortz.com/> For details for this nationwide event. You can submit any questions you still have for Neal to answer at the Webinar by sending your question to: Wsb750.promotions3@wsbradio.com

Please make the questions direct and to the point or they won't be considered. And make sure you send this email to all of your friends in your address book that support the Fair Tax or if they still have reservation and need some convincing.

IT'S IN THE BOOK! FAIRTAX: THE TRUTH

2008-02-12T20:05:00.000-08:00

I guess you guys are too young to remember the song "It's in the Book", but I grew up with it and we loved it and quoted it constantly. Whenever we threw out a "fact" for consideration, we would say for emphasis: "It's in the book!" Now we have a new FairTax book and it just popped right back into my head.

This new book "FairTax: The Truth" answers the critics. It is written by the same guys who wrote The FairTax Book, John Linder and Neal Boortz. I have just begun to read it so cannot give you a book report; however, I picked up one thing so far:

The FairTax vision is "a collection of fundamental economic principles". "What are those principles? In short words, here's what we think the American tax system should be:

SIMPLE
FAIR
VOLUNTARY
TRANSPARENT
BORDER NEUTRAL
INDUSTRY NEUTRAL
GOOD FOR SOCIAL SECURITY AND MEDICARE"

It's in the book - pick it up and read it.

IS THE FAIRTAX PROPELLING HUCKABEE OR IS HUCKABEE PROPELLING THE FAIRTAX?

2008-02-11T17:05:00.000-08:00

And do we care? The Fairtax is getting lots of publicity these days from Mike Huckabee and his presidential campaign. To his credit, Huckabee speaks about the FairTax every chance he gets. And he seems to be getting rewarded at the voting boothes. He is surprising (and distressing) a lot of people in high places - from the President on down to the talk show hosts.

I put the talk show hosts at the bottom of my list because of their disgusting behaviour lately. I am so tired of them talking against our only candidates in the Republican party left standing. Do you realize why these 3 are left standing? Because of the people voting their own minds and hearts. That should count for something.

I realize the FairTax is a non-partisan issue and I wish the Democrats would step up and help us more in their support of it. Wouldn't it be wonderful to have Obama or Hillary come out publicly in favor of the FairTax? Or how about this? Wouldn't it be wonderful if John McCain came out publicly in favor of the FairTax?

If they want my support for President, it would be real nice if they did. Meanwhile, I am sticking with Mike Huckabee as long as he is sticking with the FairTax.

DARE TO BE FAIR

2008-02-06T16:11:00.000-08:00

Congressman John Linder, the Sponsor of HR25 the Fair Tax in the House of Representatives, has begun a program to get a feel for the actual support of the HR25 the Fair Tax. Here is his message:

“We need to show that the issue of fundamental tax reform is critical to the economic growth of this nation, and I want to bring a million names to Washington, D.C. to make that point. Please sign on today to show your support for the passage of HR25 to create a simple and fair tax system.”

Go to this website:
http://www.johnlinder.com/citizen_co_sponsor.asp
and add your name as a citizen co-sponsor of the FairTax.

Be sure to pass this information along to all of the supporters (including spouses) that you know and remember to tell all new supporters that you bring on board.

WILL THE FAIR TAX CREATE AN UNDERGROUND ECONOMY?

2008-02-04T15:21:00.000-08:00

That’s one of the big arguments against the FairTax. How could it be any worse than what we have today? Today we have under the table and illegal transactions. Today we have a hidden economy of illegal aliens. Today we have the prostitutes, pimps, drug dealers and just plain ordinary citizens who conduct transactions on a cash-only basis so they don’t have to pay income taxes.

Under the FairTax, the drug dealer will be paying his taxes when he spends his money. Illegal aliens will also pay taxes as they consume; however only legal households will receive the monthly prebate check to offset expenditures up to the poverty level.

The FairTax is so simple that some fear the public will understand it. It is so visible to the public that some fear the public will learn their true tax burden. It taxes us so directly that it eliminates the ability to buy and sell tax favors, so some that benefit from this practice hate it.

The FairTax would do more than any other legislation contemplated or possible to revive our economy, reverse our balance of trade, stop the fall in the value of the US dollar, save our industrial base and return to us the freedoms we have lost due to the income tax.

The FairTax eliminates the buying and selling of tax favors by public officials and lobbyists that today corrupts our political system. By this means it transfers power from Washington back to citizens where our Founders intended it to reside.

2008-01-30T16:44:00.000-08:00

Everyone hates the IRS, except the tax accountants. Nobody can understand the IRS tax code - even the tax accountants. I say it's time to get rid of the IRS - and the tax accountants. Let them get re-trained for another type of work like the loggers in small towns all over the Northwest did after the environmentalists shut down their business.

Below is a quote from a FairTax volunteer and a link to an article about the IRS increasing their audits against taxpayers making over $100,000. Big Brother is watching you! With the FairTax, you wouldn't have to be under constant scrutiny. You would simply pay the sales tax as part of your purchases and thumb your nose at the IRS on your way out the door. Here is the quote:

"You can bet your tax return is wrong, no matter how hard you try to get it right, because NO one can properly understand the complex code. Won't it be nice when the IRS is gone?"

http://online.wsj.com/article/SB120165118416126911.html?mod=djemtct

MORE ON FAIRTAX BENEFITS FOR SENIORS

2008-01-28T16:38:00.000-08:00

I have received a number of comments on my past blogs recently. I am happy to see people going back and reading the earlier ones. I hate to keep saying the same things over and over, but sometimes I bring one up out of the past instead of writing a whole new one on the same subject.

Recent comments from readers have been noted on “Some Comments Answered”, “Senior Impact”, and “Does the FairTax Tax Rentals?”. Please go back and read those blogs together with their comments. “Ellen” especially, has made some very intelligent observations and seems to approve of the FairTax in spite of some downers for Seniors on Social Security.

Seniors have had to pay into Social Security all their working years and then, under the FairTax, would be taxed when they spend it, Ellen says. Well, that’s true, and the prebate will make up for a lot of that. There are some good points:

1. The FairTax protects future SS benefits by paying it out of the general fund, generated by
a national sales tax.

2. The Prebate.

3. The FairTax repeals the taxation of SS benefits and adjusts SS indexing to protect Seniors.

4. No more compliance costs for those Seniors who use tax preparers.

5. The FairTax does not tax used goods, which a lot of low-income Seniors take advantage of:
used cars, used clothing, garage sales, etc.

6. The FairTax will eliminate embedded taxes in manufacturers’, services’ and retailers’
costs, allowing them to lower retail prices.

7. No more taxes on IRA’s and other tax-deferred plans. (Most Seniors do not have Roth
IRA’s where “after tax” money was used)

8. The FairTax will end gift taxes, estate taxes and capital gains taxes.

9. The FairTax generates an economic boom, easing future budget pressure on Seniors’
entitlements.

10. The FairTax ensures your grandchildren have the same opportunity you did.

I think number 10 is the best reason of all and the reason I am writing this blog. I don’t want my children and grandchildren to have to worry about taxes all their lives. I don’t want to see SS benefits dry up just when my children get to the age when they can receive them.

Paying as you go is the way to go. So what if you have to pay a sales tax with your SS benefits that have already been taxed? It will still be better than being taxed with hidden taxes you don’t even know about because they are invisible.

The benefits to Seniors far outweigh the shortfalls for Seniors.

Best Comparison of 23% vs. 30%

2008-01-25T22:00:00.000-08:00

This letter was written to Ms. Strassel (check out the link below) by a FairTax Volunteer. It gives the best comparison of the income tax vs. the FairTax inclusive and exclusive rates. It really puts things into perspective:

Ms. Strassel,

While you are correct about Mr. "Bush's Economic Surrender" (1/25/'08) your discussion of the proposed tinkering with the federal tax code by three of the four prominent Republican candidates for President leaves a lot to be desired.
http://online.wsj.com/article/SB120122065042715307.html?mod=opinion_main_commentaries

You left out the only sensible total replacement of the tax code, the FairTax, proposed by Governor Huckabee. It will end the very tilted playing field of world trade which favors our trading partners and results in our industries relocating to better tax platforms. It will also end the waste of over $265 billion every year to wasteful compliance costs.

If the Journal insists on calling the FairTax inclusive rate of 23% an actual rate of 30% (exclusive), then be fair by saying that the present tax code's 35% (inclusive) rate is an actual 54% (exclusive). And, oh yes, add to that 54% the payroll tax of 15.3% (inclusive) or an actual rate of 18% (exclusive). Let's see, 54% plus 18% equals 62%; and you complain about 30%?

Bill SpillaneCalifornia State Director
(volunteer)fairtax.org
Manhattan Beach, CA

CAN YOU SAY "QUADRUPLE TAXATION"?

2008-01-24T11:25:00.000-08:00

The following letter was sent by one of our FairTax volunteers to Mr. Adler regarding his article on the FairTax. It is a very good eye-opener on our present income taxes. I linked to the article by Mr. Adler at the bottom of this letter:

How convenient that Mr. Adler has chosen to overlook the many instances of "double taxation" in the present income tax code and all the savings that will accrue to his"seniors" under the FairTax. Just for starters: the earnings that one accrues that are subject to the payroll tax are taxed FOUR TIMES today.

1) The 15.3% of earnings up to about $100,000 is taken as a tax (by the way, that's an "inclusive" 15.3%; it would be 18% if calculated as an "exclusive" sales tax.)

2) That same money already sent to the government, is now income taxed (FICA taxes are not deductible).

3) When the now "after tax" income is used to buy a US made good or service: the buyer will be paying the embedded taxes (profits and payroll taxes) in the product.

4) After retirement, up to 85% of the "earned" social security income will be taxed. In addition, today, any taxpayer paying the embedded taxes in a US product or service is not only paying with previously income taxed money, but he or she is paying state and local sales taxes on embedded taxes.

Is that double taxation enough? Furthermore, if the retiree has any money in savings that are here complained about, after FairTax enactment, there will be no more taxes on those earnings whether interest,dividends, capital gains, or death. This critique of Mr. Adlers critique is not all inclusive.

People like Mr. Adler must have another agenda; anyone who researches the FairTax with an open mind and wants the best for the US economy, and each of us, is bound to support the FairTax. http://www.townhall.com/columnists/HankAdler/2008/01/23/fairtax_double_taxation,_an_admission?voted=1

A GREAT SUPPORTER OF THE FAIRTAX

2008-01-22T18:43:00.000-08:00

Below is a link to an article by Kevin Geary, a business man and coach of the Karate USA competition team. The link is to his web site where he explains the FairTax in short, easily understandable terms and with great accuracy.

Instead of my usual diatribe, please use this link and enjoy:

http://changeyourtree.com/blog/2008/01/21/i-support-the-fair-tax-and-why-you-should-too/

SOME COMMENTS ANSWERED

2008-01-21T16:32:00.000-08:00

I can see by the comments I have been receiving that a lot of you out there do not understand, or do not want to accept, the concept of embedded taxes. The non-accepting will not accept the fact that prices will go down (experts say as much as 22%) when the FairTax is enacted. You do not trust business to lower their prices when their costs of doing business go down. You do not trust the consumers to insist on it. You do not trust free enterprise to enact price wars until the cost of goods goes down to acceptable prices.

My questions = Do you trust the IRS and Government to continue to manipulate your income? Do you think prices will remain the same under the present system? Do you think your taxes will remain the same?

No! Your Government gets more intrusive every day and you just sit back and take it. Prices keep going up, jobs keep leaving the country and you just sit back and say “I can’t do anything about it”. Taxes keep going up, government hand-outs keep increasing and you just sit back and say “Let the Government take care of me”.

This is just sick. Get a grip. And take control of your own lives and spend your money when and where you want to. The FairTax will allow this to happen.

When we say you will be able to take home 100% of your income, we don’t mean that you will not have to pay taxes like you did with the 15% payroll and SS taxes plus however much is withheld every month to pay your income taxes. We just mean you will have control of where and when you spend that money and it will be your choice of saving it (non-taxable, mind you) or spending it and being taxed.

You think about that amount. You pay 15% in payroll taxes & Social Security payments. Then on top of that, you pay 15% to 35% (whatever tax bracket you are in) as income taxes. So if you gross $50,000 per year, 15% payroll & SS amounts to $7,500. Then you are probably in the 15% tax bracket (purely an estimate – I’m not a CPA), that will take another $7,500 out of your paycheck. You will have $15,000 to spend in taxes or to save for your own enjoyment. Now if my figures are right, you will have to spend $65,217 in order to be taxed $15,000. How can that be? Well, it can’t. You’re just going to have to save some of that tax money the Government has been taking out of your pocket, because there is no way you can spend this amount in order to spend all you have saved. And don’t come back on me and nitpick my figures. I know I didn’t allow for deductions, but I am merely giving you an example. Apply it to your own paycheck and tax figures.

And quit worrying about nursing home patients who are on Medicaid. When they go through their income, nursing home patients can apply for and receive Medicaid. That means they spend the rest of their lives on the Government dole. In other words, they don’t have to pay any money; therefore no taxes. It’s the Government who pays the nursing home and with the FairTax, the sales tax. Now I am sure the Government is not going to allow the nursing homes to keep their high prices when all other business are removing the embedded taxes from their pricing.

And quit worrying about the Government. They seem to be able to take care of themselves quite nicely. They may even encourage the removal of embedded taxes in goods and services to keep their prices down. It’s time the Government started working for us and with us.

FAIR TAX VS. FLAT TAX

2008-01-18T11:40:00.000-08:00

The following is a commentary from a FairTax Volunteer on an article in the Business & Media Institute . It gives a really good comparison of the FairTax and the Flat Tax.

Excerpts:
Mitchell: "One of the problems is that advocates of tax reform are divided. This split is particularly frustrating since the flat tax and sales tax are virtually identical. Both would junk the current system. Both would restore fairness by taxing at one low rate. Both would eliminate all forms of double taxation, and both would wipe out special-interest loopholes."

FairTaxer: Identical? Ridiculous; one is an income tax similar to the Reagan 1986 reform and ripe for Congressional meddling to the max. The flat(income)tax continues the payroll tax and taxing corporations, which only pass those costs to people, usually the customer in the form of higher prices. It will NOT get rid of the IRS primarily because figuring out what "income" is happens to be at the heart of the IRS problem. More could be said about "identical".

Mitchell: "Yet this would require repeal of the 16th Amendment. Would it be possible to obtain the required two-thirds vote in both houses of Congress and ratification from 38 state legislatures? Unlikely."

FairTaxer: Yes, indeed, "unlikely". Just like the last 27 Amendments to the Constitution. Indeed, it's unlikely that we'll ever get women the right to vote! Oh! We did that! Well, we'll never prohibit alcohol sales in the US! Oh, we did that?! Well if we prohibit alcohol, we'll never go back to allowing it again! Oh! We did that, too?! He has a low opinion of the American people.

FairTaxer contd.: Both wipe out double taxation? Ridiculous again; the corporate tax of the flat(income)tax, along with the employer's portion of the payroll tax, will be folded into prices and the person with after tax income will be paying the "embedded" taxes on those products when making a purchase of US made products and services (double taxation). In addition, the latter flaws make the flat (income) tax identical to the present incometax in making US products and services more expensive than countries with no embedded taxes and who use a VAT.

Fairtaxer contd.: "Both wipe out special interest loopholes"? Perhaps on day one of the flat(income)tax, but on day two, the tax lobbyists in Washington D.C. will be out in droves to manipulate the corporate portion of the code, just like they do now while spraying campaign contributions to the four winds.

Mitchell: "Not so much for policy reasons, but rather because of practical concerns. Simply stated, the flat tax and sales tax are both theoretically attractive, but only the flat tax seems to be politically feasible."

FairTaxer: True only if you concede that the inferior flat (income) tax is more amenable to Congress people who see the opportunity for manipulating the corporate portion of the code in order to raise campaign funds. False if you believe that a proper airing of the features of both tax proposals will result in the American people demanding the FairTax.

Mitchell: "Moreover, advocates of the sales tax correctly insist that it must be accompanied by complete, irreversible abolition of the income tax in order to prevent politicians from pulling a bait-and-switch and trying to impose both a sales tax and an income tax."

FairTaxer: He's right that some misguided FairTax advocates have mistakenly said that repeal of the 16th Amendment must accompany, precede, or closely follow enactment of the FairTax in order to avoid having both a sales tax and an income tax. But he's totally in error in many ways here: TODAY, we have both an income tax AND a national sales tax in effect!

The income tax is obvious, but the sales tax is the "embedded" taxes in the prices of all US made goods and services (but not foreign made). We want to get rid of one of them. Furthermore, enactment of the FairTax, by law, eliminates the income tax and the IRS. The 16th Amendment merely ALLOWS an income tax, not requires it. Once the FairTax is enacted, we will proceed with steps to repeal the 16th. If it is not repealed, the Congress would have to start all over from scratch to enact an additional income tax.

If they try it, they will all get thrown out of office. If Congress succeeds in that diabolical endeavor, we will be back to today with an income tax and a sales tax. If they pass a flat(income)tax, we will have both an income tax and, with the embedded taxes, a sales tax, as well. Furthermore, the FaiTax has about 72 co-sponsors in the House and five in Senate. The flat(income) tax isn't even up to bat yet.

Go FairTax; get it right the first time.

SENIOR IMPACT

2008-01-16T16:24:00.000-08:00

I am re-running an earlier posting to put some perspective on the plight of Senior Citizens when the FairTax is enacted. Some think they will be paying more in sales taxes than they should have to, since they had to pay taxes on all that money they earned all these years previously.

I am getting tired of the distorted views on the 23% vs. 30%, the poor Seniors being double taxed, uncorroborated statistics, etc. without looking at the whole picture. Prices will go down.

For those of you who prefer the present income tax situation, know that you are being taxed over and over and over (embedded taxes are a fact). Compliance costs are astronomical, no matter what the figure.

Following is a copy of my earlier blog:

I am going to begin today with “The impact of the FairTax on Seniors”, a “white paper” from www.fairtax.org. I will just give you a feeling for what is in this document and if you wish to learn more, go into their website and poke on the “research button” to find the various “white papers”.

The FairTax will ensure that the Social Security and Medicare programs that are so important to Seniors become stable again, no longer a threat to “go broke” in a few years if taxes are not raised.

The FairTax rebate zeros the retail taxation of necessities, up to the poverty-level, for Seniors. Some Seniors don’t even spend over the poverty level, since they have accumulated “things” over a lifetime. Other Seniors will welcome the extra money that a prebate would bring them.

The FairTax does not tax used goods, which gives Seniors a choice of whether they wish to buy new goods and be taxed or used goods with no tax added. (We all will have this choice)

The FairTax ends all record keeping and income tax filings, which means no more large bills from Tax Preparers or Accountants. (These people will be happy to find other jobs helping you invest and grow your extra dollars saved by the FairTax)

The FairTax will reduce manufacturers’, services’, and retailers’ costs, (remember the embedded taxes?) allowing them to lower costs to seniors (and the rest of us).

Seniors will pay no more taxes on IRAs and other tax-deferred plans.

The FairTax ends gift and estate taxes so Seniors will have the satisfaction of knowing their hard-earned money will go to their heirs instead of the IRS. Wheeee!

With the FairTax, Seniors can sell their homes and pay no capital gains taxes.

The FairTax will generate an economic boom, easing future budget pressure on Seniors’ entitlements.

The FairTax ensures your grandchildren will be able to keep 100% of their income and they can decide when to spend it and what to spend it on. They will not have the IRS looking over their shoulder at every step of their careers, taking money here and grabbing money there.

HOCUS-POCUS FAIRTAX? NOT HARDLY!

2008-01-14T15:19:00.000-08:00

Boy, the FairTax is sure getting a chewing-up and spitting-out by the media, the talk show hosts and the Pundits (whatever they are). They are not giving it a fair shake. They need to learn what it is about before they start ripping it apart.

Following is a letter written by one of our FairTax Volunteers in reply to one of these so-called know-it-alls. It is long, but a good read. I high-lighted my favorite paragraph in red - at least read that:

Hocus-pocus FairTax?? Not Hardly

FairTax Act is one of the most researched public policy issues in History, is cosponsored by 72 members of Congress and endorsed by 5 presidential candidates.

In a commentary in Friday, January 11th’s newspaper, Brian J. O’Connor appeared to come to conclusions about the FairTax that often befall individuals that have a less than full understanding of the FairTax. This is easily overcome by reading the proposed legislation and looking at the research that has been done on the FairTax.

With over $22 million spent on research, the FairTax is likely the most researched public policy issue in history. This research was done by some of America’s best economists at premier universities and think tanks by individuals from the political left and right. This research is readily available at the FairTax website: http://www.fairtax.org/. I’ll refer to some of that research in responding to Mr. O’Connor’s comments.

He states that the FairTax rate is 30%, which is true, but to compare it to the income tax it is replacing then we would have to say a person at a 20% income tax rate would really be at a 26% rate, because he is buying things with after tax dollars. Under the FairTax we would be buying things with pretax dollars as we’d be receiving all of our earnings (no income and payroll taxes). To compare the FairTax to the income tax the FairTax rate should be presented as a 23% rate.

The important issue is whether we will be at a higher or lower tax rate. A 2006 study by Boston University economists Dr. Laurence J. Kotlikoff and Dr. David Rapson concluded that the FairTax benefits all income groups. Of 42 household types (classified by income, marital status and age), all have lower average remaining lifetime tax rates under the FairTax than they would experience under the current tax system, and those with lower spending levels benefiting most.

Mr. O’Connor states that economists like this kind of consumption tax but “almost anyone who can do math hates the FairTax”. Like most economists, most CPA’s know only too well that our current tax system is broken and impossible to comply with. I would guess that most mathematicians would like the FairTax after reading the bill.

He quotes a former Treasury official, Bruce Bartlett who said, ”It took me almost a month to understand this crackpot proposal.” Bruce Bartlett’s statements about the FairTax have been thoroughly discredited. His efforts to misrepresent the FairTax are not taken seriously by most economists due to their lack of scholarly content and truth. Economists will have different opinions, but almost all agree that income taxes depress the economy and consumption (sales) taxes grow the economy. It is not rocket science. When you penalize productive behavior you get less of it.

Claims are made by some that the FairTax will create an underground economy. Isn't this what we have today with all the under the table and illegal transactions, and hidden economy of illegal aliens. Under the FairTax the drug dealer on the corner will be paying his taxes when he spends his money. Illegal aliens will also pay taxes as they consume, however, only legal households will receive the monthly “prebate” check each month to offset expenditures up to the poverty level.

The FairTax is so simple that some fear the public will understand it. It is so visible to the public that some fear the public will learn their true tax burden. It taxes us so directly that it eliminates the ability to buy and sell tax favors, so some that benefit from this practice hate it.

Numerous studies confirm that on average ~22% of the retail price of all US produced goods and services are “business taxes” imbedded in the prices. As Dr. Alan Greenspan lectured Congress, "only people pay taxes." Taxes, like any other cost of doing business, are added to the cost of products and are passed on to consumers. This deceptive practice of hiding our taxes in prices is resulting in the exportation of our companies and jobs rather than our products, as it places American business and labor at a ~20% competitive disadvantage.

By eliminating personal and business income taxes the FairTax removes taxes (and $500 billion in tax compliance costs) from the prices of American produced goods and services and allows American labor and business to compete with foreign competitors on a level playing field.

The FairTax would do more than any other legislation contemplated or possible to revive our economy, reverse our balance of trade, stop the fall in the value of the US dollar, save our industrial base (that is necessary for our national defense) and return to us the freedoms we have lost due to the income tax.

By eliminating the ruse of “business” taxes people will see, on every sales receipt, their true tax burden for the first time in generations. This visibility of taxes is the self-limiting factor on taxation and size and reach of government that was intended by our Founding Fathers.

The FairTax eliminates the buying and selling of tax favors by public officials and lobbyists that today corrupts our political system. By this means it transfers power from Washington back to citizens where our Founders intended it to reside.

Roger Buchholtz

WELL THANK GOODNESS, THAT'S OVER WITH

2008-01-09T12:48:00.000-08:00

What a drag, this political process. But necessary. Another primary over with. The media thinks it's a circus and treats it as such. Every candidate has been raked over the coals and stomped on by the media and the talk show hosts.

I want to emphasize today that the FairTax does not belong to any one party - it belongs to each and every one of us Americans. It will be the American people who succeed in getting the FairTax passed, with no help from either the media or the talk show hosts.

Only one political candidate who favors the FairTax is still standing: Mike Huckabee. He talks about the FairTax whenever the opportunity arises and the media and the talk show hosts treat it like it was his idea, therefore a stupid idea.

For your information, there is a bill before congress now (HR25 & S1025) just waiting to come out of committee. Will it ever happen? Well, it's up to us to start ragging on our Senators and Representatives to get it passed NOW, before our country implodes.

Any candidate who stands up FOR the FairTax has my vote, and that includes Mike Huckabee. For those who want to put their money where their mouth is, go to http://huckabeemomentum.com and pledge a $25 donation ONLY if 10,000 people do the same.

I don't approve of everything Mike Huckabee stands for, but I have never approved of everything any candidate stands for. I have learned after many years that you can't have everything, so pick what is important to you and work towards that end.

IS RUSH LOSING HIS "GROOVE"?

2008-01-08T15:06:00.000-08:00

The following is from a FairTax volunteer, concerned about Rush's' brush-off on the FairTax and Mike Huckabee:

I've been increasingly disappointed in Rush Limbaugh lately. I tried calling the show last week, but couldn't get through. So I sent the following...
From: Greg Dutton, AZ Volunteer State Director, FairTax
'ElRushbo@eibnet.com'Subject: Your "eternal optimism"... compromised
Dear Rush, the "eternal optimist",

I've been listening to you almost daily for the past 7 years. In that time you have helped transform me into a solid and well-informed conservative, a critical thinker, and you've inspired me to get involved in my community and politics. I don't know how many times I've heard you say that we should reach high for our goals and we can accomplish great things. I have always taken it to heart.

Which is why I have to ask you to PLEASE stop saying, "The FairTax will never happen."

For you to shoot down the FairTax this way goes against every grain of your "eternal optimism."

I'm 43 years old, I work full-time and my wife and I own two businesses. I barely have time to volunteer for anything, let alone a transformational national bill. In spite of that, I became a volunteer for the FairTax, and I am now the VOLUNTEER State Director for Arizona. I and the team of grassroots volunteers that we've developed here in Arizona all work to gain ground for the FairTax. We suffer the naysayers and tredge on in spite of them. We speak in front of audiences and debate the merits of the FairTax vs. the flat tax with marked determination and perseverence. We are gaining ground, maybe slowly, but surely.

We now have 72 co-sponsors in Congress (two from Arizona), which is at least 7 times the support that the flat tax has, and hundreds of thousands of volunteer supporters around the country. Each day, we add a new brick to our foundation of support.

While it's one thing for us to win a supporter, it's a-whole-'nother thing for us to get someone on board to actually DO something. When volunteers hear you say, "It will never happen," it cuts like a knife. It kills enthusiasm and willingness to devote time. It tells us that you think we're wasting our energy and our time, and that we should just pack up and go home. Instead of doing or saying anything positive, you're tearing down. You've adopted a defeatist attitude. You have the opposite affect of the "Midas touch" by turning some of our bricks into sand. You undermine our efforts to build something that we know is right for our country and right for Conservatism.

Perhaps worse yet, you contradict so many things you stand for as an Reagan conservative and "eternal optimist."

We're not asking for your endorsement of the FairTax. We're not asking you to recant anything you've said. We're not asking you to debate the merits of the FairTax. We're only asking you to stop saying that something good and positive for our country will never happen, and start saying what CAN happen, if.... We ask you to get back to "possibility thinking."

Rush, we value your insight and analysis. We and our supporters listen to you and look up to you. We do love you, Rush. Which is why we feel so strongly about this.

Sincerely,Greg Dutton

Let's hope Rush gets a good rest and a new start in the New Year. In fact, let's hope this for all of us! It's going to be a long year, but by the time it is over with, I hope every voter out there knows and understands the FairTax. It is up to us to educate the candidates and vote for the ones who "get it".

CPA'S: TWO DIFFERENT OPINIONS PLUS: "DID I HEAR WHAT I THOUGHT I HEARD?

2008-01-07T17:12:00.000-08:00

I received a comment on one of my older blogs and also read a letter from an enthusiastic new FairTax Volunteer. I would like to share both of these letters with you. They are both CPA's with totally different views. I was afraid the comment from Anonymous would not be seen and I do appreciate him reading my past blogs. Here it is:

Anonymous has left a new comment on my post "QUESTIONS ABOUT LAWYERS AND ACCOUNTANTS":

"Happy to give up" the work going through the 60000+ tax code? Please, it's because of our speicialization in being able to do that, that we have careers in the first place. Secondly - helping our clients invest wisely is the work of their financial planners not their accountants. You've got to be kidding me, the fair tax will cripple the accounting world overnight and put literally 10's of thousands of people on the unemployment roles - it's not a good idea if you want to have an economy that maintains a low unemployment.

And below is the letter from the new FairTax Volunteer to the FairTax organization:

Ms. Colburn,
I got your contact information from FairTax.org. I am interested in supporting the FairTax initiative with my time and energy. I am a CPA with a young family, living in Richmond.
I am comfortable speaking with groups of individuals, and am generally persuasive and effective in hostile political company. I don't do anger or rhetorical flame. I will be contacting my representatives soon to state my support for the Fairtax, and may seek an opportunity to meet with them. I've got a letter to the editor of the Times-Dispatch waiting to go.
Please let me know what local organization exists which I may participate in.
Thanks,
Tim Fite

One other thing, totally off the subject: I have been watching the presidential candidates' debates and the forums and such afterwards. I heard Fred Thompson talking about his tax plan: He says he favors a flat tax. Everybody making under $100,000 would be in the 10% bracket and everybody over the $100,000 would be in the 25% tax bracket. Now how cruel is that?.........................................

THE FAIRTAX WON!

2008-01-04T18:33:00.000-08:00

Mike Huckabee ran on the FairTax and won on the FairTax. When is the News Media (both liberal and conservative) going to recognize this phenomena for what it is? Neither side has had a whole lot of good to say about Huckabee, which means the general public (people like you and I) are allowed to form our own opinions about him.

According to the Media, the younger people are going to have a bigger say in who we elect as our next president. And the younger people like the FairTax. They see the logic in it and the opportunities for themselves when they are freed up to spend, invest or save their own money.

I don't agree with everything Huckabee stands for (I should say, everything the Media says he stands for), but I do believe he is a great spokesman for the FairTax and if he gets elected President, it won't be because he is a "Fundamental Christian", whatever that is. It will be because he saw the FairTax as a way to help the people as well as his country, and ran with it.

Congratulations, Mike Huckabee!

SENIOR MOMENTS

2008-01-03T15:32:00.000-08:00

This FairTax volunteer clarifies a lot for us:

There are some responses to the criticism that the Fair Tax taxes consumption of income that has already paid tax. Most retirement savings, $16 trillion, are in "qualified plans" such as IRA's and 401K's. These tax-advantaged plans deferred taxes going in, as well as the income accumulating on the contributions.

Seniors withdrawing from these plans pay tax when the money comes out, and presumably when the seniors are in a lower tax bracket. Under the Fair Tax, money comes out of qualified plans income-tax-free, thus rewarding those seniors who had the forsight and discipline to save. Those seniors will enjoy a double benefit offset only by slightly higher prices.

Second, money coming out of tax-advantaged funds can push your social security benefits into a taxable status today. Your social security contributions were double-taxed going in, yes, payroll-taxed and income-taxed, each on 1005 of the same income. Under the Fair Tax there is no payroll or income tax on the money going in, nor is there income tax on the money coming out.

Pension income is untaxed under the Fair Tax. True, people who go into the corpus of savings or trust funds will be slightly disadvantaged. In that sense, the Fair Tax is a wealth tax. Many seniors think it is important that they can sell homes without paying capital gains tax and pass their estates on to their offspring without paying gift tax, estate tax and generation-skipping tax. The Fair Tax has an appeal to those groups.

People who are working and have not yet become seniors can save more rapidly for retirement under the Fair Tax without resort to IRA's and 401k's and other qualified plans.

I hope this has given you some ammunition. Best regards and Happy New Year,~Jim

STATISTICS ARE WHAT YOU WANT THEM TO BE

2008-01-02T18:59:00.000-08:00

The following was submitted by a FairTax volunteer. Just goes to prove that statistics can be manipulated for your own means:

During the American Enterprise Institute's February28, 2007 program on "Taxing Sales Under the Fair Tax: What Rate Works?" one development demonstrated that the conclusion of the Beacon Hill Institute and Kotlikoff is to be adopted to the exclusion of Gale's.

The background is as follows. William Gale had published a paper in Tax Notes on May16, 2005 contending that the replacement rate necessary for a national sales tax along the lines of a Fair Tax would be 31% tax-inclusive, 44%tax-exclusive. Before coming to the seminar, Gale had reduced his rate requirement to 28.2% tax-inclusive,39.3% tax-exclusive.

The Beacon Hill Institute of Suffolk University Team, in collaboration with Boston University's Laurence J.Kotlikoff, using Gale's methodology, published its own paper in Tax Notes over one year following the Gale paper on November 13, 2006. In their paper Beacon Hill concluded that the Fair Tax revenue replacement rate would be 23.82% tax-inclusive, 31.27% tax-exclusive.

With minimal spending reductions on the non-Social Security side of the government spending ledger, the 23% tax-inclusive rate would put the government in the same surplus-deficit position as it is today. Kotlikoff, who with David G. Tuerck argued his and Beacon Hill's position at the seminar, presented a detailed reconciliation of how their analysis resulted in a lower rate than Gale's, using the same methodology. The presentation showed, item-by-item, where Gale's revenue base was understated, and where Gale's required revenue was overstated.

In the discourse that followed, Gale admitted that he could not account for the difference between his rate and Beacon Hill's. After some perfunctory remarks rejecting certain possibilities, Gale dismissed the problem with the statement that the "difference must be in the weeds. "Gale should have combed through the Kotlikoff-Beacon Hill "weeds" before coming to the seminar. Gale had at least three months before the seminar to do so, and he knew that his own thesis had been challenged and would be challenged further.

The analysis that would have been required from an economist such as Gale would not have been difficult because the Kotlikoff paper used Gale's methodology. The data was government data, to which Gale had ready access. As of today, Gale still has not explained why his figures differ from Kotlikoff's and Beacon Hill's. I submit that he has not done so because he cannot.

HAPPY NEW YEAR EVERYONE!

2007-12-31T16:34:00.000-08:00

I heard on the radio today that the IRS was spending around 3 Billion dollars to bring tax cheaters into compliance with the income tax. Can you imagine what our country could do with that 3 Billion dollars if they didn't have to chase tax dodgers? I think it's time for a change, don't you?

I am copying a letter written by Jim Bennett, a FairTax volunteer. It says a lot in few words:

To the editor of the Wall Street Journal:

Dear Editor, Several comments sent in by readers and appearing in the December 31, 2007 issue call for a response. Retirees who pay sales tax during their golden years for the most part contributed tax-free into IRA's and now under the Fair Tax will be able to withdraw from their IRA's tax-free.

Their Social Security benefits,on which they were double-taxed going in (yes, income and payroll) will be tax free coming out. The Fair Tax will stabilize the tax base for Social Security, whose future is in peril today because of the dwindling payroll base relative to burgeoning retirees.

Seniors will be able to sell their homes free of capital gains tax and pass their estates onto their children tax free. Even if it is true that crime figures and illegal aliens would pay little more under the Fair Tax, would it not be beneficial to shift the tax burden towards these types and away from business?

The fact is that crime figures would have the same purchasing power butnow would pay tax on their purchases. Crime figures and illegal aliens, together with foreign tourists, purchasers of imports and those who go into the corpus of savings would be more disadvantaged than lower and middle-income people as a group.

Wealthy people do benefit from the Fair Tax, as does everyone else, but lower-income people benefit disproportionately. A sales tax such as the Fair Tax is far more efficient to collect than an income tax. Collection points drop from 155 million to 20 million.

Furthermore, it takes two to cheat on a sales tax, and just one to cheat on an income tax. I welcome the attention the Fair Tax is garnering now from the Wall Street Journal.~Jim Bennett

FAIRTAX FACTS BY LEO LINBECK, CEO AND CO-FOUNDER OF AMERICANS FOR FAIR TAXATION

2007-12-27T19:21:00.000-08:00

The following is an e-mail sent to us FairTax Volunteers and I thought I would pass it on. It is lengthy, but a good read and encompasses much of the FairTax Facts. I will leave it up the rest of the week so you can pop in and read a bit every day if it is too long for you.

Meanwhile, I am struggling with my year-end bookwork, getting ready for tax-time. Good grief - what do people see in this present income tax system? What a waste of our good time. Well, here's the good stuff:

COMMENTARY - FairTax Facts By LEO LINBECK, December 26, 2007; Page A10, Wall Street Journal.

Much has been written lately about the FairTax, the proposal to replace the current federal income tax with a national retail sales tax. Unfortunately, much of it is wrong. This country needs a spirited and wide-ranging debate about fundamental tax reform. But that debate is not advanced by misimpressions and distortions of the FairTax. Let us then clear up a few.

One assertion about the FairTax is that it began as a project of the Church of Scientology at a time when it was seeking tax-exempt status. This is false. The FairTax actually comes to us from market research conducted more than a decade ago by a handful of business leaders. Their goal was to determine what type of tax system would be most acceptable to the American public. The studies they paid for cost millions of dollars, included hard economic research by respected scholars, and were subjected to critical peer review.

The result is a proposal, since introduced as legislation in Congress, now known as the FairTax. What emerged from this research is that a national retail sales tax is a preferred method of taxation among most Americans surveyed. Another is that the tax would have significant benefits for the nation's economy. Why? Because it eliminates income taxes and payroll taxes (for Social Security and Medicare), which are costly to collect and end up as "embedded" in the price of everything we buy.

Along with getting rid of the Internal Revenue Service and the complexities of the income tax code, the FairTax would eliminate the distorting effect that income and payroll taxes have on the economy. Research on the price of consumer goods reveals that up to 20% of all prices today represent hidden income taxes and payroll taxes. Once these taxes are repealed and replaced with the FairTax, it is likely that market pressure would force retail prices to fall.

Eliminating embedded taxes will also do something else -- it will remove significant price disadvantages suffered by American producers competing with tax-free imports. Eliminating corporate income taxes and capital gains taxes, which the FairTax would do, would likely make the American economy the most desirable place in the world to do business.

Another benefit of the FairTax is that, unlike other sales taxes, it would not hit the poorest Americans the hardest. The FairTax proposal calls for sending every American a "prebate" check to offset the cost of the national sales taxes paid by those living in poverty. This feature would effectively exempt those living below the poverty line from paying taxes to the federal government, and provide all taxpayers with a reimbursement of a portion of taxes paid.

The FairTax rate is 23% on retail sales when calculated "inclusively," as are income tax rates. It will, in a fairer, more transparent and less-expensive way, raise the same amount of money the federal government now collects through the income and payroll taxes. Because it would be levied on consumption at the final point of sale, instead of on earnings, it would dramatically expand the tax base.

The FairTax would collect revenue from the underground economy. Even illegal immigrants and the 40 million foreign tourists who visit the U.S. each year would pay it. The distributional effects of the FairTax have been extensively studied, and although the proposal has distinct advantages for investors and wealth creation across the income spectrum, the greatest benefit of the FairTax is to low- and moderate-income Americans.

The effect of eliminating regressive payroll taxes is commonly overlooked when analyzing the FairTax, but it would have a very significant impact, as these taxes represent the single largest tax burden on these income earners. Significantly, the FairTax eliminates all loopholes, gimmicks, exemptions and deductions from the federal tax system. Under the FairTax, Congress would no longer be able to reward friends, punish enemies or manipulate behavior through the tax code.

The FairTax would also eliminate the lucrative tax lobbying practices that represent more than 50% of all lobby dollars spent annually in Washington. It's no surprise, then, to see that vested interests have argued against the FairTax and in favor of keeping the mortgage interest deduction. But wouldn't it be better for everyone to stop the IRS from withholding from paychecks; to see the price of new homes -- and all other goods -- drop by removing embedded costs; and to have interest rates fall as the savings rate increases?

Is it really in everyone's interests to keep the income-tax system so that one-third of taxpayers can go on deducting a portion of their mortgage interest from their federal taxes? There have been many tax reform proposals over the years, but most of them simply call for reforming around the margins of the existing tax system.

The President's Advisory Panel on Tax Reform was assembled by the Bush administration and concluded its work a few years ago. Instead of seriously looking at the FairTax, the panel looked at a very different type of consumption tax, riddled with exemptions, and then declared that it would be too expensive and that the rate would have to be far higher than the FairTax rate.

Politically, the FairTax will only become law once enough citizens demand that it be enacted, overcoming the self-interest that members of Congress and others have in holding onto the current system. It is debatable whether a modern, citizen-led tax revolution is possible. But the growing popularity (even among presidential candidates) of the FairTax suggests that another Boston Tea Party may be at hand.

Mr. Linbeck is CEO and cofounder of Americans for Fair Taxation.

If you agree with the idea of the FairTax, go to my link on signing the petition and DO IT. We need all the support we can get to get our congressmen to listen to us instead of the lobbyists.

SOME ANSWERS A FAIRTAX CRITIQUE

2007-12-21T14:14:00.000-08:00

A reader named Derek has done an excellent job of answering Hayden Kepner’s summary of James Taranto’s critique of the FairTax in the Wall Street Journal. I’m pasting Derek’s answer below. Hayden, thanks for the summary.

"Little David", this may answer some of your questions. Also, there are some glitches in the new FairTax Calculator. They are working them out, so you might try your figuring a little later. I will let you know on this blog when the problems are fixed.

1. “If someone’s tax goes down, somebody else’s need to go up.” Complaints along these lines rely upon a belief that the current tax system is set up perfectly, and that are placement is judged based on whether or not it taxed everyone the same as the old system. If that was the point of a replacement, why replace it?

The fact is, the current tax system taxes income, while the FairTax taxes consumption over the poverty level. So of course, it will go up for some and down for others. However, claims that the poor and middle classes get hard by this are ridiculous.

First,the FairTax removes all tax burden for those at or under the poverty level. They can spend 100% of their income on consumption and pay zero taxes, whether explicit or embedded in the price of the products. This is not true today, where even the poorest payabout 22% of all of their consumption spending on hidden, embedded tax costs. Anyone who argues that the poor will be adversely affected by the FairTax either doesn’t understand it or is purposely being deceptive.

For the middle class, the degree to which they get hit by the FairTax is completely dependent on the degree to which they spend money beyond the poverty level. So for those just beyond poverty, there is very little tax cost. For those spending at 2x times poverty, which probably covers most people, their tax cost is half of the FairTax rate (11.5% of their spending).

The full FairTax rate is only felt once you get to spending far beyond the poverty level, at which point you are probably no longer considered middle class. In addition to paying the correspondingly-lower sales tax rate, as explained above,middle class taxpayers will (like all taxpayers) benefit from a reduction in the embedded taxes in our current prices ... which will vary from one industry to the next, but in some circumstances are as high as 20% of the current price of goods.

Also, like everyone else under the FairTax, the middle class — which is increasingly savvy about investing their money — will be able to make their investments 100% tax-free. This makes it even easier for middle class families to become upper class families.For these reasons, it’s actually pretty mind-boggling to me why anyone would claim that the middle-class will be hardest hit.

The folks who are hardest-hit will be those who currently pay little-to-no income tax (e.g., trust fund babies, drug dealers, etc) but who live lavishly and spend a lot of money.

2. The underground economy is a lose some, gain some. We currently have no way to tax underground income now (taxing income of prostitues and drug dealers) - under theFairTax, we won’t be able to tax underground consumption (taxing the payment of prostitutes and purchases of drugs). There’s really little difference there. You move the imposition of income tax on the person purchasing an illegal product or service to imposition of consumption tax on the person spending the money achieved through illegal activities.

I agree that this isn’t a reason to enact the FairTax, but it’s not a reason to criticize it, either. In theory, though, it does bring more elements of the underground economy in line since even a drug dealer has to buy food at the grocery store, buy gas for their car, etc., all of which is participation in the taxable economy.

The amount of money that these people spend each year is no trivial thing, incidentally. Some knowledgeable estimates put it as high as a trillion dollars annually. Currently that money is not subject to the income tax, but it would be subject to the FairTax —potentially raising billions in revenue.

3. Economic growth. “When you reduce tax rates to zero...” Tax rates are not reduced to zero. They are replaced by consumption taxes. And in that scenario, businesses will no longer have to focus on the tax costs of their decisions, and it will free up businesses to make decisions based on growth and profitability without worry about taxes.

It also makes US companies much more competitive globally — our current tax structure is a major impediment to US economic growth.

4. “When you tax consumption, people spend less.” Is it assumed that the only reason people spend money is because it’s already been taxed as income? Certainly tax decisions influence consumption decisions — but the desire, need, and drive to consume will always be there. If people decide to spend less and give more to charity to avoid paying consumption taxes, isn’t this true under our current system? And if people decide to spend less and save more to avoid paying consumption taxes, doesn’t this help create jobs and expand the economy?

“The tax will hit hardest on those who NEED to spend money.” And it will only hit money spent beyond the poverty level. And that is consistent no matter how much you spend. And if you don’t spend it, you can only either give it away or save it. Both of them are positive things.

5. “The yacht industry suffered under a 10% ‘luxury tax;’ just imagine what would happen under a 30% FairTax.” The reason luxury taxes don’t work is because it shifts incentives from one category to another. If you raise taxes on a specific luxury (or class of luxuries), then other items because more favorable because they are taxed less.

So rather than buy a yacht, maybe I’ll consider a 2nd home since that won’t be taxed as much. TheFairTax avoids this because all products and services are taxed equally. It is, inreality, completely different from a luxury tax and the comparison doesn’t hold.

I ADDED A PICTURE!

2007-12-19T13:05:00.000-08:00

I added a picture today of my great grandson, Wyatt. I imagine a lot of you people out there are getting just about as tired as he is. Well, hang in there - Christmas is almost here.

I couldn't resist putting this picture in my blog today. It says so much about why I am doing this. I won't be getting near the benefits that Wyatt will when he starts earning a paycheck, if the FairTax is in place by then. I hope we don't have to wait that long.

I appreciate the open discussions possible in this blog and I appreciate the fact that you are not abusing my blog with name calling and bad words ("bathroom language", as my Dad used to call it). I think we can all agree on one thing - we certainly do need a change in our tax system.

I would just like to see our politicians doing something - anything - of value to us while they are in office. They seem bent on one thing - lining their own pockets and getting on the government pension dole. They don't seem to care about fixing Social Security, Medicare, the Income Tax System, or anything else that benefits their constituents. I think it is time to write some letters and then back it up by going to the polls and voting these do-nothings out of office. They are treading on my freedoms.

Bah, Humbug.

Merry Christmas.

IMPACT ON TAX LAWYERS, PREPARERS & CPA'S

2007-12-18T13:06:00.000-08:00

Following are a couple of paragraphs taken from a FairTax Volunteer letter. We discussed the impact on tax lawyers, tax preparers and CPA's a while back and I thought this was an interesting addition:

"I have talked to a couple of tax preparers and a CPA, and they are the first to admit our current system is way too complex. Blue ribbon economists have projected the Gross Domestic Product would jump 10% the first year, and continue at that rate for the foreseeable future. People with accounting skills should have no trouble finding new work in such an environment.

As far as the impact on the middle class is concerned, all except the very highest tax brackets would enjoy a net savings on their effective tax. The reason for that is that the FairTax opens up a much broader base to be taxed, including non-reported income, illegal activities, loopholes, and tourists. The FairTax is a win, win, win."

Also, I have posted a new FairTax Calculator in the links section. There are easy-to-answer questions that lead to a logical conclusion that gives you a side-by-side comparison of your own tax situation comparing the income tax with the FairTax. Give it a try.

HERE'S MORE FOOD FOR THOUGHT

2007-12-17T11:34:00.000-08:00

Thanks everyone, for keeping my blog active this week. You have had some good discussions and I appreciate the politeness and respect that goes along with it.

Below is an interesting letter from a fellow FairTax volunteer, Kenneth Van Dellen:

What do you think of this? I think we should put out an eye-catching leaflet that asks some good questions.Would you like a tax system that...

Replaces the income tax, SS tax, etc., with a fairer tax?
Lets you buy used items (houses, cars, clothes) with untaxed dollars?
Lets you buy basic necessities with untaxed dollars?
Completely untaxes the poorest?
Taxes others according to what they are able to spend?
Lets you give gifts to churches, charities, family members, and friends with untaxed dollars? (I don't think family and friends will qualify for untaxed dollars - Bobbie)
Lets you use untaxed dollars for educational expenses?
Does not require you to keep income and expense records if you want some of your tax payments back (as a tax refund)?
Does not require you to pay an accountant to be sure you pay what you should and get refunded what you should get?
Does not require you to reveal all kinds of private information to a government agency?
Does not cause you any concern about being audited, investigated, or worse?
Lets you pay your tax when it is due, not before you get the money?
Makes it impossible to pay too much and have to wait months for a refund, or to not pay enough and have to send a check to the IRS?

And the list goes on…You get the idea. Rather than telling folks all about it, which we can do later, let's arouse their curiosity. Then tell them how to get more information.Perhaps my "50 Reasons Why I Like the FairTax" could be turned into 50 questions. I haven't studied that. The above items were pretty much off-the-cuff, and could possibly be worded better in some cases.

FAIRTAX – WELL, WHICH IS IT-23% OR 30%?

2007-12-10T16:15:00.000-08:00

I keep getting letters and seeing articles about whether the FairTax is really 23% or maybe 30%.

The FairTax advocates like to say 23% (inclusive) for one simple reason – comparing it one on one with the current income tax (also inclusive). All of our taxes now are taken out of our gross paycheck, before anything else – right off the top. It is a certain percentage, based on your gross income. It is not added on top of your gross. Get it? (Of course, your income tax is arrived at after many individual deductions, but that is another story)

The FairTax naysayers like to say 30% for one simple reason – to kill the whole idea of the FairTax by making it sound worse than the FairTax advocates call it. The 30% is an “exclusive” tax, which does not compare at all with the present income tax.

Now let’s complicate things a bit. Let’s make a fair comparison with the present income tax. That’s where it gets confusing, people’s eyes cross and their minds go blank.

It is easy to take 23% of someone’s gross income (well, easy for the government), but let me show you how that would have to come about if, say, you were selling your house. Your Realtor comes and says your house is worth $100,000. Well, you look the Realtor in the eye and say “Fine, add your commission to the top of that and I will list with you”. So the Realtor gets out his trusty calculator, puts the $100,000 into it and divides that by 94% and comes up with $106,382.98, rounds it up to $106,400 and gets the listing. When the Realtor finds a buyer for $106,400, he shows you the amount you will gross after his commission: $100,016. That makes you happy and you sign the papers to sell. The Realtor is happy because he gets his 6% commission. The buyer is happy because he gets the house he wants. The lender is happy because it appraises up to price.

What we have just done is make the price of this home “inclusive” of the Realtor’s commission, whereas the homeowner had told the Realtor to make it “exclusive” (add the commission on top of my price). You see, the Realtor has to talk full price; therefore, the price of the home had to “include” his commission.

When the merchant sells his goods, he has an amount he has to gross. Let’s say he needs to gross $1.00. In order to do this, he has to add the amount of the tax to his gross profit, just like the Realtor had to add his commission amount. He gets out his trusty calculator, puts in $1.00 and divides it by 77% (1.00-.23=.77) which adds a 23% sales tax to his $1.00. Well, low and behold, that comes to $1.30 so naturally the naysayers call it a 30% tax. Well, if that were true, the merchant would have to charge $1.43 for his product in order to gross his $1.00 amount. Do the math. $1.30 - 23% = $1.00.

The merchant has to sell his goods and services at one price, a price that “includes” the sales tax. If you think it is worth it, you buy it; if you don’t, you won’t buy it. You make that judgment based on the total price, not the price the merchant wants, only to be hit with a 23% sales tax at the cash register. Your receipt automatically breaks out the tax amount so you will see exactly how much you spent in taxes. You don’t have to keep that receipt because you don’t need it to keep as a deduction when you file your taxes in April. Why? Because you won’t be filing (or paying!) taxes in April, ever again; therefore, you don’t need any deductions (including your home mortgage deduction)

The merchant has to keep that receipt, because he has to file a report along with the tax money he sends to the government every month. He gets paid for doing this, by the way, just like your tax account used to (only not nearly so much!)

These examples probably did not clear up the muddy waters for you. I think the only reason it made sense to me immediately is because I was a Realtor and many times have been told to add my commission to the top of the price I quoted to a seller. This is another example of embedded taxes, which is done all along the merchandising line, driving prices ever upward.

There are approximately 22% embedded taxes in every thing you buy. With the advent of the FairTax, this practice will stop, because goods and services are taxed only once: at the point of sale. How will it stop? Good old American competition. So if the prices go down by 22% and the FairTax is included in the price of goods and services (23%), it looks to me like you will be paying out 1% difference between the two, which isn’t going to change prices much at all, either up or down.

But you will be keeping 100% of your paycheck! No more payroll taxes and no more income taxes. Plus you will be getting a monthly prebate to help you stomach all of this .

This is terribly long today and the closer Christmas is, the busier I get. I am going to let you digest this for a week and comment on it. Also, go back and read my other blog on the 23%vs30% sales tax and maybe it will sink in. It’s a hard thing to grasp. I welcome your comments. Maybe someone else can explain it better than I. I have to relate it to something I know – real estate – and I thought these examples might be helpful to you also.

I noticed a number of interesting comments on my last blog - makes for good reading this week.

A GREAT LETTER TO THE WALL ST. JOURNAL

2007-12-06T10:38:00.000-08:00

This letter is from a fellow Fellow FairTax volunteer. It makes some excellent points. It is nice that the media is starting to talk about the FairTax, but I do wish they would do their research and get it right. This letter goes a long way in setting them straight:

To: The Editor of the Wall Street Journal
Regarding: Article "The Huckabee Contradiction" December 5, 2007; Page A24

Dear Editor,
I'm responding to the comments made in your December 5 article on Huckabee where you say, "the fair tax would be worth consideration if we were writing a tax code from scratch. Realistically, we're not. The plan would require repealing the Sixteenth Amendment that allowed a federal income tax, and the chances of that happening are approximately zero."

The problem, plain and simple, is that the tax code has been manipulated for too long to benefit those who can afford to fund the 35,000 lobbyist army that descends on Capital Hill, year-in and year-out.

The solution, plain and simple, is that THE EXISTING TAX CODE MUST BE COMPLETELY SCRAPPED! No flat-tax or band-aid fixes will ever be true reform . A flat will simply revert us back to where our tax situation was 40-50 years ago, and any further tinkering with the tax code will just be more of the same abuse that we've endured over the past three decades.

The only answer to real tax reform is not reform at all, but replacement! The FairTax(sm), H.R. 25, is the only tax plan ever proposed that can and will lead us to eliminate the 16th Amendment, and here are just some of the reasons why:

A 23% consumption tax (calculated the same way as income tax today) on NEW goods and services will eliminate/replace all forms of personal and corporate income taxation, including inheritance tax, capital gains tax, AMT, and payroll tax.

No individual or business will ever file a tax return again. IRS forms and tax schedules will become a distant memory. The IRS as we know it will be obsoleted and eliminated, no longer needed to enforce a bloated, incomprehensible tax code that penalizes every hard-working American for their success with a graduated Marxist income tax that only the rich can afford to circumvent by paying a mere 15% in capital gains tax.

The simple monthly FairTax prebate will ensure that no household will pay taxes on their basic necessities of life up to the poverty level (as set by the US Dept. of Health and Human Services), making the FairTax the ONLY tax plan that will completely untax the poor while lowering the overall tax impact on middle income families. But the wealthier you are, the more you'll consume and the more you'll contribute to the federal revenue. That's fair.

Under the FairTax, anyone earning income under the table will no longer be able to get away without paying taxes, whether they are here legally or otherwise. No flat income tax proposal or "simple" reform plan will ever do that.

In addition, the FairTax will once-and-for-all prevent Social Security and Medicare from going bankrupt by providing a far more stable source of revenue (consumer spending vs. wages). Remember, consumers include EVERY living, breathing human being on American soil, including the 50 million+ visitors annually that come here to tour, go to our universities, or to fill temporary work visas.

Finally, in case you haven't seen it, Section 2.f. of H.R. 25 (attached here for your convenience), actually calls for the repeal of the 16th Amendment:

"SEC. 2. CONGRESSIONAL FINDINGS. (f) FINDINGS RELATING TO REPEAL OF PRESENT FEDERAL TAX SYSTEM.—Congress further finds that the 16th amendment to the United States Constitution should be repealed."

You can argue over the word "should" if you like, but all of the above will be a nail in the 16th Amendment's coffin, and there are many more to the FairTax than I've listed here. Rest assured, there will not be a soul in America that will want to revert back to the income tax once the FairTax is put into place.

Once the FairTax is enacted, the grassroots that helped make it a reality--the same grassroots that have been here long before Huckabee--will immediately turn attention to permanent repeal of the 16th Amendment. And we will prevail.

Until then, until you actually have a plan to replace the income tax, there's no chance for the 16th Amendment to be repealed.

THAT'S why the FairTax is the ONLY plan that will make the 16th Amendment history.

Best wishes,
Greg Dutton, Arizona Volunteer State Director
Americans For Fair Taxation
National Web Site: http://www.fairtax.org/
State Web Site: http://www.azfairtax.org/
Online Petition: http://www.fairtax.org/action/petition.aspx
eMail: StateDirector@AZFairTax.org
Phone: (480) 763-9791
Fax: (480) 718-8182

REPLY TO RICH LOWRY'S "MAGIC WAND OF TAX REFORM PLANS"

2007-12-04T15:17:00.000-08:00

I have been reading e-mails about Rich Lowry's abomination of the FairTax in his opinion piece entitled "The Magic Wand of Tax Reform Plans. In it, he called the fair tax "daft", "politically unsalable", "so-called", "a bed-time story", "more complex than the current tax scheme".

His article was full of un-truths (lies) and I am submitting my reply to Mr. Lowry in the Oregonian as well as various other local newspapers in the area. I doubt if anything I send will reach print, so I guess that's what a blog is for: to state my views and refute the "big boys' lies".

Poor Rich Lowry, having to stoop to lies to turn us off the FairTax. We must be making progress with our grassroots campaign. Please allow me to address and correct Lowry’s Lies:

Lie #1: FairTax: “the most radical—and politically unsalable and substantively daft—proposal of any major presidential candidate of either party.”
Truth: FairTax: The most researched tax proposal to date, politically “salable” in that there are 72 members of Congress currently supporting this proposal. Lowry is calling the voting public “substantively daft”. I am not crazy—are you? Oh, and the FairTax reaches across the aisle, is non-partisan since everyone pays taxes and few, if any, like the IRS.

Lie #2: “The so-called (there we go again) FairTax would eliminate the income and payroll taxes and replace them with a (supposedly) 23% national sales tax.”
Truth: This statement is true except for the name-calling and the deliberate bashing of the 23% sales tax (Lowry says: “What they really are talking about is a tax of 30 cents on every dollar”). Doesn’t Lowry know the difference between an inclusive and an exclusive tax? The FairTax is being compared to the income tax on an “inclusive” basis, therefore it is 23%. It is like comparing apples to apples, Mr. Lowry.

Lie #3: “Nevermind that it is unworkable and would be politically deadly in a general election”.
Truth: The FairTax has been extensively researched by The Cato Institute, The Heritage Foundation, Fiscal Associates, Boston University, Stanford, Rice, MIT & other institutions. As for “politically deadly”, I say yes, only to the Lobbyists and the Senators and Representatives who want to control every aspect of our lives.

Lie #4: “The congressional Joint Committee on Taxation has estimated that the rate would have to go as high as 57%”.
Truth: With the FairTax, you will only be taxed once—at point of sale. No more embedded taxes added along the manufacturing line to cover the cost of payroll taxes and corporate taxes, which drives prices up and up. What we have now is a VAT tax PLUS and Income tax. And do you really think the Congressional Joint Committee wants to give up their control of you?

Lie #5: “it would amount to an incredibly regressive tax on even the most necessary purchases of low– and middle-income taxpayers.”
Truth: The FairTax would totally untax the poor and the elderly. The pre-bate makes this the most progressive tax of all the tax proposals on the table. As for middle-income taxpayers, you decide when and how much to pay in taxes.

Lie #6: “the government would send monthly “pre-bate” checks to all Americans based on income”.
Truth: The government would send monthly pre-bate checks to every head of household with a valid social security number, based on the annual poverty level determined by the Dep’t of Health and Human Services, NOT based on income. Remember, under the FairTax, no more income taxes, therefore no more reporting of income to the IRS..

Lie #7: “The mortgage deduction would be gone, and instead buyers would pay a 30% (at least) tax on their homes.”
Truth: There are two lies here: Yes, the mortgage deduction would be gone, but so would the income tax on every dollar you earn, therefore eliminating the need for a mortgage deduction. How much income tax deduction can you deduct from zero income tax? And yes, buyers would pay a 30% exclusive (Lowry used 23%, inclusive, in his other examples) tax on their homes, BUT only their NEW homes. Used homes and used goods are not taxed under the FairTax.

Lie of the day (#8): "Any of these points makes the FairTax so vulnerable to attack”…
Truth: Lowry is right about this point, and he knows just how to attack—with lies.

THE FAIRTAX ALLOWS WAGE-EARNERS TO SAVE MORE MONEY, FASTER

2007-12-03T16:17:00.000-08:00

The FairTax would allow wage-earners to save more money faster for home ownership, education, investments and retirement. The FairTax increases your purchasing power, making it easier to get ahead financially by eliminating:

the individual income tax
the payroll income tax
the estate tax and the gift tax
capital gains taxes
the alternative minimum tax
the self-employment tax
the corporate income tax

Each individual would have their entire paycheck to spend as they wish, save for a new home, pay their child's tuition, invest in the future, etc. Take a look at your pay check and add up the amount that is deducted each pay period for taxes. This is the amount you would be able to use to advance yourself monetarily in whichever way you choose.

The elderly would receive their entire social security check, not a check minus the deduction for medicare. (Medicare as well as Social Security deductions will be paid through the consumption tax) They would also have the prebate to help them with monthly expenses. Lots of older people don't spend more than a minimal amount for new goods and services. They already have a lifetime accumulation of furniture, dishes and "things", so the consumption tax is not going to be a problem for them.

The poor do not spend a lot on new goods and services, because they don't have the money to spend. The prebate will be a god-send for them. The poor buy used cars, clothing and "things", which will be exempt from the consumption tax. They will actually be better off and may even be able to get ahead in this world, for a change.

The rich will continue to spend as they have become accustomed to. They are used to buying the newest and the best and they will continue to do so. In fact, they will be paying their fair share for the first time in their lives because they can't hide their money in tax loop-holes or off-shore accounts. Well, they can, but they can keep it here now, circulating in the U.S.A. because they are no longer penalized or taxed to the max for having it.

None of us will be penalized for earning a living, as we are now. To read more about the FairTax, go to http://www.fairtax.org/ and read the basics or read the bill itself (HR25 & S1025)
I believe workers should keep their whole paychecks, don't you? www.FairTax.org

2007-11-30T22:53:00.000-08:00

The following letter was sent to me by a fellow FairTax Volunteer:

Dear Ms. Strassel:
I will answer your question as to why the Thompson tax proposal went into the media black hole. Its that his proposal is nothing new or, in your words, 'the most creative tax proposal yet in the race for President.' It is just more of the same. Keep the current code and make little nips and tucks here and there that will never be enacted, or if they are, will be modified every year thereafter. Your statement tells me that you have not been paying much attention to this race, or the tax issue, in any detail.
Mike Huckabee has come from below nowhere to a real contender in very little time with very little money, despite being attacked by the mainstream conservatives and the Club for Growth. Why? The FairTax. In case you don't know what it is, the Fairtax is the only creative tax reform proposed by any candidate. It is by far the most supported tax reform in Congress today. While several other candidates support the Fairtax, Huckabee is the only one that has made it one of his core issues and talks about it all the time. His support is far beyond his share of the Christian Right, which is divided among several candidates. It is because millions of Fairtax supporters are getting behind him. Americans for Fair Taxation, the group and economists that researched and put together this comprehensive proposal, is non-partisan. But ordinary Americans who support the Fairtax are going with the leader on this issue, Huckabee. Americans realize what the pundits and media elite do not, that the Founders knew the evils of taxation on income and practically eliminated it in the Constitution. They realize that the 16th Amendment was the worst mistake in American history. They realize that the 1986 tax reform, while better than nothing, soon turned into an even worse nightmare. They know that the current code corrupts everything it touches, which means all otherwise honest Americans and otherwise honest Members of Congress. They know that they will never have their privacy back until they don't have to share the most intimate details of their personal and business lives with the Federal and State governments. They know that the Fairtax will eliminate the hundreds of billions of compliance costs, will lower the price of exports, that will return trillions of dollars to America, and will unleash the American economy for the shackles of the income tax.
I hope you will write again on the tax issue in a balanced way, and address the Fairtax and Mike Huckabee's support of it. You can learn all about the Fairtax at www.Fairtax.org, or by calling me or Americans for Fair Taxation. My number is 602-291-4805, and AFT is 1-800-Fairtax. As you so eloquently point out, we cannot count on CNN/Youtube or any of the uninformative television media to bring this issue to the fore in a meaningful way, so we need outstanding journalists and writers like yourself to get the ball rolling. I enjoy all your articles.
Gary H. Burger Jones,
Skelton & Hochuli, PLC
Phoenix, AZ 85012

DARK & BEST KEPT SECRETS OF OUR SOCIAL SECURITY

2007-11-29T14:46:00.000-08:00

This was e-mailed to me today - thought I would pass it along.........................................:

Something You Should Know About Your Social Security
AND WE HAVE NO CHOICE ABOUT PAYING THIS TAX,
HOW IT IS SPENT OR HOW
WE GET OUR PORTION BACK

Dark and best kept secrets about Our Social Security:

Many years ago in Seattle, two wonderful neighbors, Elliott and Patty Roosevelt came to my home to swim on a regular basis. They were a great couple full of laughter and stories that today I continue to marvel at. Both are now deceased, but their stories remain.

During the years of our friendship we had many, many discussions about Elliott's parents (President Franklin D. and Eleanor Roosevelt) and how his father and mother never intended for the Social Security and Welfare programs to work out the way they are today. Elliott used to say that if his parents returned to earth and saw what the politicians had done to their programs they would have burned all of them in hell.

Here is a story I received today regarding the Social Security Program and I immediately thought of Elliott's comments. I Hope you will read this and think about it.
_____________________________________________
Franklin Roosevelt, a Democrat, introduced the Social Security (FICA) Program.
He promised:
1.) That participation in the Program would be completely voluntary,
2.) That the participants would only have to pay 1% of the first $1,400 of their annual incomes into the Program,
3.) That the money the participants elected to put into the Program would be deductible from
their income for tax purposes each year,
4.) That the money the participants put into the independent "Trust Fund" rather than into the
General operating fund, and herefore, would only be used to fund the Social Security Retirement Program, and no other Government program, and,
5.) That the annuity payments to the retirees would never be taxed as income

Since many of us have paid into FICA for years and are now receiving a Social Security check every month --and then finding that we are getting taxed on 85% of the money we paid to the Federal government to "put away" -- you may be interested in the following:

Q: Which Political Party took Social Security from the independent "Trust Fund" and put it into the General fund so that Congress could spend it?
A: It was Lyndon Johnson and the democratically controlled House and Senate.

Q: Which Political Party eliminated the income tax deduction for Social Security (FICA) withholding?
A: The Democratic Party.

Q: Which Political Party started taxing Social Security annuities????
A: The Democratic Party, with Al Gore casting the "tie-breaking" deciding vote as President of the Senate, while he was Vice President of the US.

Q: Which Political Party decided to start giving annuity payments to immigrants?
This is MY FAVORITE:
A: That's right! Jimmy Carter! And the Democratic Party of Course! Immigrants moved into this country, and at age 65, began to receive Social Security payments! The Democratic Party gave these payments to them, even though they never paid a dime into it!
-----------------------------------------------------------------
Then, after doing all this lying and thieving and violating of the original contract (FICA),
the Democrats turn around and tell you that the Republicans want to take your Social
Security away! And the worst part about it is uninformed citizens believe it!
==============================================
"THE ONLY THING NEEDED FOR EVIL TO TRIUMPH IS FOR GOOD MEN TO DO NOTHING"

THE FAIRTAX LOWERS TAX RATES + GIVES YOU A PRE-BATE

2007-11-28T21:37:00.000-08:00

This is a busy month for me and probably for you too, so I will be recycling some of my earlier blogs that you may not have read or you may wish to read again. Have a great Christmas Season!

Everyone will receive a Prebate from the federal government. It will be administered through the Social Security Administration and will be figured for each family residence based on the proverty level for the year as figured by the Dep't. of Health and Human Services.

The chart is shown in the FairTax Basics on their website (http://www.fairtax.org/) As an example, a single mother with one child will receive a monthly prebate of $262; a couple with no children will receive $391 per month; a couple with 4 children will receive $658 per month.

These amounts should cover the amount of tax (23% times your proverty level amount divided by 12) you would pay on new goods and services up to the poverty level. There is also a chart in the FairTax Basics showing your effective FairTax Rate for a family of 4 (2 children) beyond the poverty level income. For instance, if you (family of 4) make $54,760 per year, your effective tax rate would be 11.5%; if you make $109,523 your effective rate would be 17.3%. You would have to make $876,160 in order to pay 22.3% in taxes.

So you see, this is a truly progressive tax. The people at the poverty level are entirely untaxed; the prebate ensures this. And please remember, this is a tax replacement. This tax is designed to generate the same amount of revenue that the present tax system does.

The FairTax is just what it says - Fair. Every citizen who signs up for the prebate will receive it. Sure the rich don't need it, but we need to be fair to all, not to just a chosen few. Otherwise it would be like a glorified welfare system, not a truly fair system of no taxes up to the poverty level. There should be no exceptions and no exemptions in order to keep this tax fair to all.

TAXES, TAXES, AND MORE TAXES!

2007-11-27T14:46:00.000-08:00

This was sent to me from a friend. I have read it before, and I imagine you have too. We all need to read it again.........and again..........and again..............Now does the FairTax make sense?

Thanks Friend! What brought us here is the fact that there are too many of us AMERICANS who either do not care to really know what and who they are voting for; or they want a free ride on someone else's back/shoulders. I certainly hope this can challenge a few to spend some time to get to know who to vote for next VERY CRUCIAL year. Vicrichard Wahl

This is funny til it gets too close to home.
At first I thought this was funny...then I realized the awful truth of it. Be sure to read all the way to the end!

Tax his land,
Tax his bed,
Tax the table
At which he's fed.

Tax his tractor,
Tax his mule,
Teach him taxes
Are the rule.

Tax his cow,!
Tax his goat,
Tax his pants,
Tax his coat.

Tax his ties,
Tax his shirt,
Tax his work,
Tax his dirt.

Tax his tobacco,
Tax his drink,
Tax him if he
Tries to think.

Tax his cigars,
Tax his beers,
If he cries,
thenTax his tears.

Tax his car,
Tax his gas,
Find other ways
To tax his ass

Tax all he has
Then let him know
That you won't be done
Till he has no dough.

When he screams and hollers,
Then tax him some more,
Tax him till He's good and sore.

Then tax his coffin ,
Tax his grave,
Tax the sod in Which he's laid.

Put these words upon his tomb,
" Taxes drove me to my doom..."

When he's gone,
Do not relax,
Its time to apply
The inheritance tax.

Accounts Receivable Tax
Building Permit Tax
CDL license Tax
Cigarette Tax
Corporate Income Tax
Dog License Tax
Excise Taxes
Federal Income Tax
Federal Unemployment Tax (FUTA)
Fishing License Tax
Food License Tax
Fuel Permit Tax Gasoline Tax (42 cents per gallon)
Gross Receipts Tax
Hunting License Tax
Inheritance Tax Inventory Tax
IRS Interest Charges
IRS Penalties (tax on top of tax)
Liquor Tax
Luxury Taxes
Marriage License Tax
Medicare Tax
Personal Property Tax
Property Tax
Real Estate Tax
Road Usage Tax
Recreational Vehicle Tax
Service Charge Tax
Social Security Tax
Sales Tax
School Tax
State Income Tax S
tate Unemployment Tax (SUTA)
Telephone Federal Excise Tax
Telephone Federal Universal Service Fee Tax
Telephone Federal, State and Local Surcharge Taxes
Telephone Minimum Usage Surcharge Tax
Telephone Recurring and Non-recurring Charges Tax
Telephone State and Local Tax
Telephone Usage Charge Tax
Utility Taxes
Vehicle License
Registration Tax
Vehicle Sales Tax
Watercraft Registration Tax
Well Permit Tax
Workers Compensation Tax

STILL THINK THIS IS FUNNY?Not one of these taxes existed 100 years ago, and our nation was the most prosperous in the world. We had absolutely no national debt, had the largest middle class in the world, and Mom stayed home to raise the kids. What the hell happened? Can you spell "politicians!" And.... I still have to "press 1"for English.

CORPORATE TAXES & COMPLIANCE COSTS

2007-11-26T20:35:00.000-08:00

I hope you all had a good Thanksgiving. Now it's back to dieting and back to blogging:

You think Corporate taxes have nothing to do with you? Well think again. The costs of running a corporation are huge and they pass those costs right through to the consumer so they will have the money to pay their corporate taxes at taxtime.

By eliminating these taxes, the price of new goods and services should go down. The competitive nature of business will not allow these prices to stay at today's level. We should see a drop in prices equivilant to the amount of the sales tax (23%). This may take some time since a free market is a self-adjusting market. When the grocery store across the street lowers the price of bread by 23% because he no longer has to pay payroll taxes or income taxes, the other grocery stores in the area will do the same in order to compete. You will be the winner. To take this a step further, the corporation that baked the bread for the grocery store can lower his prices because of the same thing - his costs will be lower and he will pass that savings on to the grocery store or lose the business to a baker who does pass on these savings.

Further on down the line, the corporations that provided the ingredients to the baker for the bread will lower their prices and then finally the farmer in the field who grows the wheat for the bread can lower his prices because everything he has to purchase to maintain his farm can be bought at a lower price.

Do you see the snowball effect this will have on the price of everything? By the time all of the "hidden taxes" are removed the price of new goods and services will probably be lower, even with the sales tax added. Here are some statistics dealing only with the cost of compliance with the tax code, taken directly from the FairTax Website (http://www.fairtax.org/) : "Compliance with the tax code is not only very difficult and complicated, consuming a total of 6 billion hours, but unreasonably expensive as well. It is estimated that it costs taxpayers $265.1 billion for tax filing, tax record keeping, and tax reduction advice. That's just shy of $900 for every man, woman, and child in America! We have taxation without comprehension!"

Wow! By the time we buy that bread at today's prices, we still have to put up with the tax accountant and the IRS. It's just not fair. I would rather see the total cost of my tax dollars on my loaf of bread receipt rather than knowing there are hidden costs and added-on taxes and not being able to control it or know for sure how much I am really paying in taxes.Tomorrow we will discuss the Pre-bates, which even out the playing field for the poor and the elderly.

FAIRTAX ELIMINATES SOCIAL SECURITY WITHHOLDING

2007-11-20T14:38:00.001-08:00

Social Security - The most regressive tax of all. It takes a good percentage of your monthly paycheck and you don't even know if Social Security will be there for you when you retire. With the FairTax this withholding will disappear, but Social Security will be stronger than ever, since it will become part of the 23% consumption tax and therefore become a guarantee that it will be there for you as well as your parents and grandparents. Plus it will ensure your children and grandchildren of having that part of retirement guaranteed for them as well.

The FairTax will make Social Security and Medicare healthy again. For independent contractors and business owners, the FairTax will be a double blessing when it comes to Social Security taxes. These people have to pay double what the monthly wage earner pays - their share and the business' share. It becomes a terrible burden at tax time. Independent contractors and business owners have lots of tax write-offs, but they still have to pay their entire Social Security withholding and there are no write-offs for that.

With the FairTax, their Social Security withholding would be a part of the consumption tax so that every time they made a purchase a small amount would be going towards this particular tax and there would be no large lump sum due quarterly like there is now. For monthly wage-earners, the same would be true: You would receive 100% of your paycheck with no tax withholding of any kind.

These taxes would be paid over the year as a part of all new goods and services and only when YOU decide, not every two weeks or monthly as it is now. You would have the use of ALL of your money until you make a purchase. Then and only then will you be paying taxes. Wouldn't you like to keep 100% of your paycheck and YOU be the boss, not the government? The politicians are not going to like this - They will lose control over you.

The Lobbyists will not like this either - they will lose control over the politicians. TAKE BACK YOUR GOVERNMENT! YOU BE IN THE DRIVER'S SEAT!

FAIRTAX FACTS REGARDING JOBS

2007-11-19T11:59:00.000-08:00

I am going to be recycling some of my first blogs this week. Thanksgiving is a busy time for us, what with Doctor appointments, cooking, travel and such. Have a good week, give lots of thanks and enjoy reading my earlier blogs that you may have missed, or forgotten:

1. Creates jobs where the current system destroys jobs. Too many businesses are sending jobs overseas because the labor is cheaper AND the taxes are more favorable. If we enact the FairTax, these businesses will be happy to move back to the U.S. and I wouldn't be surprised if a number of other countries would rush to set up business in the U.S. because of the favorable tax system, thereby bringing more sales tax revenue that we didn't have before. Also, the individuals and corporations with off-shore banking accounts will bring their money back here. You will see a boom to our economy that you never would have dreamed possible. You won't have any trouble finding a job that suits you and pays well. 2. Gives you your whole paycheck. No federal withholding! You will receive 100% of your income. Look at your paycheck: How much is your employer holding out of your check for various payroll taxes? That money would come to you to spend, save or invest as you like. You would only pay taxes when you purchased new goods or services. In the meantime, that money could be sitting in YOUR bank account earning YOU interest. Or invest in stocks or bonds. Whatever YOU decide to do with YOUR money.

FAIRTAX CALCULATOR

2007-11-16T16:55:00.000-08:00

I'm baaaaaaaaaaack!

Ian and Dutchman did such a good job sparring with each other on yesterday's non-blog, I thought I would continue in that vein so you can do your own figuring on how much the FairTax is going to cost you or save you. You can find a FairTax Calculator at www.fairtax.org that will help you out with this project.

With some, it may be a lot, with others, it may be a wash. But the benefits to America and the economy will be a huge winner and you can help take credit for getting America out of debt, leaving a wonderful legacy for your children and grandchildren. Sometimes you have to look at the big picture when figuring the end results.

The end results with the FairTax will be zero debt, a strong Social Security system, a strong medicare system, more jobs, more money free for investments, easier to save for your kids college education, etc. etc. etc........................

It's not just "what's in it for me". It's also "what's good for America", because without a good, strong, solid America, it is too late to worry about "what's in it for me".

THE FOOTBALL GAME WON OUT

2007-11-15T19:45:00.000-08:00

I thought about saying I felt old, so no blog today, but then decided to tell the truth. I was just lazy today and did nothing! And tonight the Football game came on and - well - as the saying goes, "there goes the ballgame".

Talk to you again tomorrow.

NO BLOG ON BOBBIE'S BIRTHDAY

2007-11-14T15:18:00.000-08:00

I refuse to do a thing on my birthday; therefore, no blog.
Happy Birthday to me...............................

CLARIFICATION OF THE PREBATE – CORRECTED!

2007-11-13T16:52:00.000-08:00

Well, I screwed up yesterday, so this is eat-crow day and correct my mistakes. First of all, I got the Prebate figures wrong. I started looking at my white paper, which had the 2007 chart of prebates. Then I thought I had better play it safe and go straight to the FairTax Bill. Well, that bill had 2005 charts in it, since that’s when it was written, and I didn’t notice the date change until “Dutchman” pointed out the discrepancies to me. Thank you, sir.

That got us wondering about my assumption that a parent or grandparent living with the couple and 2-3 children would be considered a dependent (or child). Bonnie, (head of the FairTax volunteers in my area, called down to the FairTax headquarters and this is how it works:

If you are 18 or older, living at home, going to college or working, you would get a prebate of a single person, or $196/mth, based on 2007 charts.

If you have 3 adults and 2 kids in a household, you would receive a prebate of $525/mth for the couple and 2 kids, PLUS the 3rd adult would receive a prebate based on a single person, or $196/mth, based on 2007 charts.

If you have 4 adults and 2 kids in a household, you would receive a prebate of $525/mth for the couple and 2 kids, PLUS the 3rd & 4th adult (if a couple) would receive $391. If the 3rd & 4th adult were not married, they would receive $196/mth each.

Bonnie also asked whether a person could receive a rebate at a P.O. Box number. The answer is yes, as long as that person is a legal citizen, has a social security number and is not registered at another address. The prebate is tied to the SS#, wherever it resides. I presume that would include the homeless, as long as they were able to get a P.O. Box #, could prove their citizenship and had a SS#.

As for “Dutchman” asking about the prebate status of 100 orphans in an orphan facility, I would think that orphan facility would be considered a “charity” or a “non-profit business” and would be handled as such. But that’s just my opinion. Anybody else out there have one? We welcome your discussion.

CLARIFICATION OF THE PREBATE

2007-11-12T13:59:00.000-08:00

One of the students in the home school class we visited last week presented us with the following question: Does the pre-bate change or allow for 3 adults and 2 kids in the same household? This generated another question, this time from the teacher: What would happen if my parents moved in with us? That would be 4 adults and 2 kids. Do you know how this would work?

Well, I consulted my trusty white papers and also checked these questions out in the actual bill (HR25/S1025). Here are the answers:

QUALIFICATIONS

All qualified families, consisting of all family members who share a common residence, are entitled to receive the monthly prebate. Family members include an individual and his or her spouse, children and grandchildren, parents, and grandparents.

Children living away from home are considered family members if they are registered as a student for at least five months out of the year and receive at least 50% support from the family unit.

Children of divorced parents are considered to be family members of the custodial parent. Incarcerated individuals are not eligible to be members of a qualified family.

In order for a person to be counted as a member of the family, a person must have a valid Social Security number and be a lawful resident of the United States.

The application/registration form that families who choose to receive the prebate must file is simple and straightforward. Those choosing not to register will not receive a prebate.

CALCULATION OF THE PREBATE

The monthly prebate check is calculated by multiplying the annual poverty level spending published each year by the Department of Health and Human Services times the FairTax rate and dividing by twelve.

There is a chart in the white paper and also in the FairTax bill showing the prebate schedule for 2007. You can check it out and figure exactly what your rebate will be under the FairTax. These payments allow for additional amounts for a 2-adult household, which eliminates the marriage penalty. I am assuming that after that adjustment, additional adults in the family unit would be considered the same as a child as far as the amounts of the rebate.

ADMINISTRATION

The prebate is sent out by the Social Security Administration around the 1st day of each month. Prebate payments can only be made to persons 18 years or older; however, the prebate payment can be divided evenly among those persons as designated on the registration form.

So lets figure the prebates on the examples given in the questions.

3 adults and 2 kids in a household: (Counted on the chart as 1 couple, 3 kids)
The monthly rebate would be $554.

4 adults and 2 kids in a household: (Counted on the chart as 1 couple, 4 kids)
The monthly rebate would be $617.

I have a link on my blog to the FairTax bill, the plain English summary, if you wish to check out the chart or read further on this subject. It is in Chapter 3.

QUESTIONS ABOUT LAWYERS AND ACCOUNTANTS

2007-11-09T16:55:00.000-08:00

My friends and relatives tend to e-mail me with questions rather than ask them under comments in the blog. I thought I would pass this one on for discussion. The question:

"My fear is that the accountants and lawyers will gang up on us because they will be losing lots of jobs. Or is there a solution for this?"

The answer (one or two anyway – you guys can probably think of more):

The accountants will be very happy to give up their work trying to figure out the 60,000+ pages of the IRS laws and concentrate their efforts on helping their clients make smart investments with the extra money they will have. Many accountants will turn to investment counseling.

Many tax attorneys will turn into investment attorneys or any one of the many other ways attorneys have of making money.

There will be lots of work for both accountants and attorneys. The economy is projected to grow with the FairTax, businesses and manufacturers will come back to the U.S. from overseas and there will be an abundance of jobs. These new wage earners will need advice on how to spend their money, among other things.

Read chapter 12 in “THE FAIR TAX BOOK” by Neal Boortz and John Linder. In this chapter, he discusses the impact on tax attorneys and accountants, plus the impact on the many people who work for the IRS. He puts it much better than I can.

Please, if there are any Tax accountants or Attorneys reading my blog, weigh in and tell us your thoughts on this subject. Thanks.

DOES THE FAIRTAX TAX RENTALS?

2007-11-08T17:59:00.000-08:00

I was asked this question the other day and thought this would be a good time to answer it. As you know, both owner-occupied and renter-occupied housing is taxable under the FairTax. With owner-occupied housing (new), the tax is collected up front at time of sale. With renter-occupied housing (new or used) the monthly rent is taxed as it is collected by the landlord.

Renter-occupied housing under the present Income tax is paid with after-tax dollars.
Renter-occupied housing under the FairTax is paid with pre-tax dollars, plus there will be a pre-bate added to the renters income to stretch his/her dollar further.

Since investment property is not taxed under the FairTax, but the rents are taxed, the rental property will not be subject to double taxation.

An example in the FairTax Research information compared the Income Tax structure with the FairTax structure using $500 in monthly rents. With a 15% income tax bracket, the renter would have to earn $647 in order to pay his income taxes and payroll taxes and have $500 left to pay his rent.

Under the FairTax structure, the $500 rent plus the 23% sales tax amounts to $649, $2 more than the income tax in order to cover his rent. HOWEVER, in comes the pre-bate to the rescue! And that renter has only had to use $2 of his monthly pre-bate to pay his rent, leaving the remainder to pay the taxes on his medical bills, dental bills, groceries, etc.

I hope that answers your question. If not, go to FairTax.org for more information. I don’t know how to make charts in this blog so you will have to rely on the FairTax website for visual proof.

THE FAIRTAXERS GO TO HOMESCHOOL!

2007-11-07T17:23:00.000-08:00

Bonnie, our FairTax Volunteer Director in this area, and I presented our FairTax Program to some Forest Grove home-schoolers today. They had been studying the FairTax during their Government class and their teacher asked us to come and talk to the students about the FairTax. There were approximately 11 students ranging in age from 11-17, plus one parent, and Bonnie and I were simply amazed at the good behavior in class and the intelligent questions asked.

We showed them the DVD “The FairTax – it’s Time”, answered their questions as best we could and I read them my “Let’s Pretend” blog, which is my favorite. It give the facts of the FairTax in a fun and easy to understand manner. We then gave them a packet of printed matter, a CD for their computer and a FairTax Card.

Hopefully, we have some new blog readers and lots more questions and comments to come.

WELCOME HOMESCHOOLERS!

THE AUTO INDUSTRY HAS AN 18% HANDICAP

2007-11-06T17:49:00.000-08:00

Our present Income Tax system is driving the manufacturers overseas for one reason: money. Foreign countries have an 18% advantage over U.S. produced goods, whether competing here or abroad. The following example brings it home real well:

U.S. Production:
If sold in U.S. markets, they pay U.S. income and payroll taxes.
If sold in foreign markets, they pay U.S. income, payroll and foreign VAT taxes.

Foreign Production:
If sold in U.S. market, they pay no U.S. income, payroll or foreign VAT taxes.
If sold in foreign markets, they pay foreign VAT taxes.

No wonder foreign countries can sell their cars (and other goods) cheaper than the U.S.
No wonder our U.S. manufacturing and jobs are leaving this country at an alarming rate.

Manufacturing today represents half of what its share of GDP was in the 1950s. Wages are lower (or non-existent) because of overseas competition.

AND THEN COMES THE FAIRTAX! (hopefully)

The FairTax will make the U.S. the manufacturing capital of the world by being the only industrialized nation with a zero rate of tax on manufacturing and hiring U.S. workers.
The change in our tax structure will put the U.S. on a level playing field and you will see the price of automobiles (and other goods) go down, able to compete with foreign markets. There would be more jobs at higher wages and more money to spend and invest. The FairTax will also save the U.S. more than $100 billion in exports annually, just by getting rid of our present unfair tax structure.

THE FAIRTAX AND THE AUTOMOBILE

2007-11-05T15:48:00.000-08:00

My husband got home from the hospital finally, and is feeling much better now, so I have again taken up my blog:

As you know by now, the FairTax taxes all NEW goods and services; therefore, if you are accustomed to buying a used car-no taxes are added. But, if you are accustomed to buying a new car, you will be paying a FairTax on top of the sales price.

The good news is, that sales price will be lower, due to the fact that the price of the car will no longer include all of those embedded taxes (you know, taxes and costs added to the price of the car all along the manufacturing line and up through the retail level)

The purchasing costs of a new car are predicted to be lower by about 10% (14% for self-employed people), and that lower amount INCLUDES the FairTax. There is a chart in the FairTax.org website, a white paper under Industries/automobiles, that shows this prediction. It shows the total new car cost, including taxes, to be $43,537 under the present income tax system, and $39,160 under the FairTax, a difference of $4,377. That difference amounts to 10.05% less under the FairTax.

Another reason for a lower price under the FairTax is interest rates. Interest rates are projected to fall 25-35% under the FairTax, which would be a substantial amount given the high price of new cars today.

Also, you will be buying this new car with pre-tax dollars, thereby increasing your buying power.

Tomorrow we will look at the unfair treatment of the U.S manufacturers vs.the Foreign manufacturers of autos.

NO BLOG TODAY

2007-10-30T18:53:00.000-07:00

I spent most of the day in the emergency room of the hospital with my husband. They finally admitted him and I got home about 4:30pm, hungry and tired. Therefore, no blog today. I'll see how it goes tomorrow - go to www.fairtax.org for your FairTax fix today. Thanks

FAIRTAX TREATMENT OF INSURANCE IV

2007-10-29T15:35:00.000-07:00

This is the last day for the insurance thing. I will cover health insurance and then sum everything up at the end and be done with it. For more indepth info, go to FairTax.org and check out the white papers under Research.

Health Insurance:

Income Tax:

Premiums for health insurance are treated differently, depending on who purchases the insurance. If you as an individual, purchase it, the insurance is paid for with after-tax dollars and not deductible.

If you are pay part of the premium for insurance through your employer, it is not deductible unless your employer establishes a Section 125 Plan, in which case your portion is paid for with pre-tax dollars, thus reducing your future Social Security benefit.

Because of the tax preferences in the income tax code, almost all health care is purchased by employers and the government. This removes flexibility, control, and cost awareness from the consumer.

FairTax:

Since the FairTax taxes all new goods and services one time, your health insurance premiums are taxed, but the charges billed to the insurance company by the doctor are not taxed. This avoids double taxation. If the insurance benefit is paid directly to you, it includes the insurance credit to prepay any taxes due as the benefit is spent.

If you purchase health care services directly from the doctor, such as co-pays or deductibles, the charges are taxable.

From the doctor’s perspective, the FairTax removes the cost of payroll taxes, income taxes, self-employment taxes, the cost of administering income tax withholding and payroll tax deductions for his/her employees, and personal income tax, payroll tax and compliance costs.

This allows the doctor to charge less for his/her services. It allows for the consumer to pay his/her lower-cost premiums with pre-tax dollars.

Summary of the benefits of the FairTax to the insurance industry and consumers:

The pre-tax cost of insurance should drop as embedded taxes and compliance costs are removed.
The average American takes home 100% of their paycheck.
Only the risk component of cash value life insurance is taxed.
Cash values of both annuities and life insurance contracts grow and can be withdrawn tax free.
A credit insures that all insurance benefits are consumed tax free.
Death benefits are both income and estate tax free and include a credit to insure they aren’t taxed when spent.
Health insurance benefits are tax free.
Natural markets are restored to the purchase of health insurance, helping to control and even lower future health care costs.

There, I’m done. Can you see how tied-down we are by the present income tax system? Can you see how much more free we will be when Congress passes bills H25 & S1025?
Call, write and beg your congressmen to sign on supporting the FairTax ASAP.

FAIRTAX TREATMENT OF INSURANCE III

2007-10-26T16:05:00.000-07:00

Hopefully we can finish up with insurance today, or Monday at the latest. Then maybe we can hit on something more interesting, like buying a car, or talking about gas and oil. Then again, that sounds a bit boring too.

I try to cut these things down as far as possible and still make sense to you. If you need
examples, or just want to suck in all the info you can get on insurance, feel free to go to the White Pages of the Research part of the FairTax.

We continue today with:

ANNUITIES:

Annuities can be sold as either qualified plans (IRAs, 401ks, Seps, etc.) or non-qualified, (such as mutual funds). Premiums to non-qualified annuities are made with after-tax dollars. Cash values grow tax deferred. Withdrawals are taxed as ordinary income and they slap a penalty on you if you withdraw anything before the age of 59½. This early withdrawal penalty applies to both qualified and non-qualified annuities.

The growth on non-qualified annuities is tax deferred; however, gains are taxed as ordinary income when withdrawn. The more traditional non-qualified investment, such as a mutual fund, would receive more favorable capital gains treatment.

Annuities also have higher costs than other investments. These extra costs are for administration and protection benefits, such as guaranteed minimum death benefits or living benefits.

Here is a comparison of the current income tax system and the FairTax in the treatment of non-qualified annuities:

Premiums:

Income Tax: The premium is paid with after-tax dollars and is not deductible.

Fair Tax: The FairTax treats the annuity premiums like all other forms of investment: does not tax them. Premiums are purchased with pre-tax dollars. The consumer has increased take-home pay (100%!) to invest. Any service charges are taxed, but these costs will be lower due to the removal of embedded income/payroll taxes in the cost of doing business.

Cash Value:

Income Tax: Accumulations are tax deferred. When withdrawn, cash values are taxed as ordinary income, in the highest income tax bracket for the consumer and with a 10% penalty if withdrawn before age 591/2.

FairTax: Accumulations are tax free. Withdrawals are also tax free. Pre-tax prices of goods and services purchased with the proceeds should be less expensive due to the removal of embedded costs.

Death Benefit:

Income Tax: At death, any gains are taxed as ordinary income to the beneficiaries.

FairTax: None of the proceeds are taxed at death.

Well, we still need to cover Health Insurance, so I guess we go into Monday. Have a good Friday and a great weekend. May all your favorite football teams win (unless they're playing mine!)

LETTER REGARDING FRED THOMPSON AND THE FAIRTAX

2007-10-25T17:02:00.000-07:00

Every now and then a FairTax letter comes through my e-mail and catches my eye. I am digressing from the Insurance stuff to show you a copy of the letter, plus a reply. I was especially impressed with the reply that certainly would have put Fred Thompson in his place. After all the time and money and study that has gone into the development of the FairTax, it’s too bad you can’t think of a reply like that on the spot.

Here is the letter:

I had the opportunity to take my 8th grade civics class to hear Fred Thompson in Mt. Pleasant, SC this morning. He said, "As I scan the room, I see many people wearing FairTax stickers. I see them everywhere I go. FairTax has a better campaign going on than any of the candidates!"He was then asked to endorse the FairTax. His response was disappointing. He said, "I can't take the numbers they've come up with and run with them. I'll have to run the numbers for myself. I'm keeping all tax reform ideas on the table. We may wind up with a plan that takes a little from this and a little from that. We need a plan that can pass the Congress."Keep the heat on!
John SteinbergerCharleston, SC

Here is the reply to the letter:

Fair Tax put together by top Economists, over a number of years at several millions of dollars, surprised that you think you can do better. Cheers - Phin

One thing we DON’T need is a “plan that can pass the Congress”. We need a plan that can satisfy the people for a change – WE NEED THE FAIRTAX!

LET'S TACKLE INSURANCE #2

2007-10-24T16:19:00.000-07:00

My eyes glaze over and I start hyperventilating when I talk about insurance. But it must be addressed in relation to the FairTax, so here goes:

For businesses, both the premiums and the benefits are treated as a tax-free business input. The following comparisons address insurance purchased for personal use only.

PROPERTY/CASUALTY INSURANCE

Income Tax: No tax benefits or tax credits. Like other services, embedded taxes are included in the price of the premiums.

FairTax: The premium is subject to the sales tax. The benefit is received tax free and includes a credit to prepay taxes that are due when consumed. (Remember, with the FairTax, you only have to pay a tax once, when you buy something)

LIFE INSURANCE

The FairTax treats both term and cash value life insurance as well or better than the income tax system does.

Premiums-------------

Income Tax: Premium is paid with after-tax dollars.

FairTax: Only the “term” component of a premium is taxed, not the “investment” component.

Cash Value-------------

Income Tax: Cash values grow tax deferred and is taxed as ordinary income. The principal is not taxed; however, it is paid for with after-tax dollars.

FairTax: Neither the principal nor the interest is taxed. They only become taxable if used to purchase new goods or services, which should be lower with embedded taxes backed out of the equation.

Death Benefit-------------

Income Tax: A death benefit is income tax free, but sometimes subjected to estate taxes.

FairTax: A death benefit is tax free PLUS the beneficiary receives a credit equal to 23% of the benefit to prepay any sales taxes due when spent. No estate taxes, ever again!

This is enough to digest for today. I should be able to finish up the insurance stuff tomorrow and then hopefully we will find a more enjoyable topic. Meanwhile, you insurance lovers can get lots more in-depth information in the White Pages of the Research section of the FairTax website.

LET’S TACKLE INSURANCE!

2007-10-23T17:00:00.000-07:00

I have always hated insurance. But it seems to be a necessary evil. The primary purpose of insurance is to mitigate risk, either on property or people. Here are the differences between our present income tax system and the FairTax:

Income Tax system: The entire premium is paid with after-tax dollars.
FairTax: Only the monthly premiums are taxed, with pre-tax dollars.

Income Tax system: Insurance cash values grow tax deferred.
FairTax: Insurance cash values grow tax free.

Income Tax system: Cash values are taxed upon withdrawal.
FairTax: Cash values are withdrawn tax free.

Income Tax system: Benefits received are tax free today
FairTax: Benefits are received tax free.

To avoid double taxation, the Income Tax system taxes the premiums, but not the benefits. The premiums are made with after-tax dollars and they are not allowed as a deductible on your income taxes.

The Fair Tax taxes the premiums, but the benefit is received tax free. The proceeds are taxed as spent; therefore, there is an insurance credit paid out on the benefit to avoid double taxation.

That’s enough for today – more tomorrow.

THE FAIRTAX AND MIKE HUCKABEE

2007-10-22T14:33:00.000-07:00

The Oregonian had a large article reprinted from the New York Times regarding Mike Huckabee and his “Electability – Let me count the ways”. They counted everything about him except for his support of the FairTax. The FairTax has always been a staple in his speeches and this David Brooks writer didn’t even mention it!

I know the politicians are afraid of the FairTax. It will remove a lot of their powers over us. But is the Media afraid also? And if so, why? The FairTax would benefit so many people.

I am including my letter to the Editor of the Oregonian for you to read, since it may never see print in the big “O”:

To the Editor:

David Brooks’ article about Mike Huckabee was great, but it left out the most important aspect of his campaign – the FairTax. Mr. Huckabee is the only candidate among Republicans and Democrats who consistently talks about the FairTax. Some of the other candidates mouth it, but Huckabee lives it.

The FairTax is a bill in committee (HR25 & S1025) to replace the income tax, to fix the Social Security & Medicare systems before they go broke, to allow taxpayers to take home 100% of their income, and many more amenities.

The most important “fix” would be to give back control to the people. And that is exactly why you won’t see many politicians in favor of the FairTax. It takes away their control of us and removes the control of their lobbyists. Mike Huckabee isn’t afraid to empower his voters. He has my vote.

Bobbie Godfrey

IT'S NO-BLOG FRIDAY AGAIN!

2007-10-19T20:03:00.000-07:00

Well, hey, I'm retired you know! We had company today and I didn't have time until right now to do my blog and I am not about to get serious on a Friday night.

Have a good weekend - we'll talk on Monday, ok?

FAIRTAX BENEFITS YOUNG AND LOW-INCOME FAMILIES

2007-10-18T17:14:00.000-07:00

Well, I don’t know about you, but I have had it up to my ears in investments, stocks, bonds, corporations, etc. If you want to learn more about that stuff, go into www.fairtax.org and check out the research papers. They have loads of information. As for me, I am more interested in the benefits for young working families, low-income families and fixed income families. I say “what’s in it for me?”.

The young working families represent my children and grandchildren. The fixed-income families represent my husband and me. The low-income families represent the people on welfare and the minimum-wage earners. For all of us, the following applies:

1. No more payroll withholding taxes. Take home 100% of your paycheck. You are no longer burdened with the prospect of paying out all that money in Social Security taxes that you are told you will never see.

2. No more income taxes withholdings, so paycheck-to-paycheck families can take home 100% of their paycheck. No more records to keep, returns to file, tax preparers to pay, or IRS audits to endure.

3. Every family can purchase the necessities of life tax free via the tax pre-bate that exempts all spending up to the poverty level, determined by the Department of Health and Human Services. Even the rich get this pre-bate so the system will be fair and equal to all and the politicians will not be able to start messing around with the FairTax like they have with the income tax.

4. The FairTax ends the sham of corporate taxes – the government levies taxes on business. Business “pays” such taxes by raising prices to consumers, lowering the wages paid to workers, or by lowering dividends paid to shareholders. Notice who gets the shaft here…………….we all do. No more hidden taxes with the FairTax.

5. Used products are not taxed, thereby reducing the tax burden on spending above the poverty level. This means you can buy a used car, a used home or go to your neighborhood garage sale and buy used merchandise, all tax free! The rich and the more affluent will be buying the new stuff, as they always have, and low and behold, they will buy more because they too will have more dollars left to spend.

6. Now you had better go back and study up on those investments, stocks, bonds, and such, because now even we can afford to buy those things!

THE IMPACT OF THE FAIRTAX ON INVESTMENT

2007-10-17T13:20:00.000-07:00

Our present income tax system is a real downer when it comes to savings and investments, through double, triple, and even quadruple taxation. You get taxed when you earn the money (wages). Then, if you save or invest some of your money, you get taxed again and again. 100% of your income from investments is taxed (up to 80% if Nancy Pelosi has her way, leaving you a measly 20%). You have to pay capital gains taxes if you sell it for more than it was purchased.

Corporate income (including capital gains) is taxed at the corporate level and again when it is paid to shareholders as dividends. And on and on, until, when you die, the estate and gift tax may kick in for one final tax blow.

With the FairTax, the following is true. I copied it directly from the FAQ on the Fairtax website:

"What happens to the stock market, mutual funds, and retirement funds? Investors prosper greatly under this plan, since corporations face lower operating costs and individuals have more money to save and invest. The reform significantly enhances the retirement savings and/or retirement spending power of most Americans. The purchase of stocks is considered a purchase for investment purposes and not personal consumption so they are purchased tax free. The service fees charged by the broker, however, are personal consumption and therefore subject to tax. "

After the repeal of the income tax and the enactment of the FairTax, the U.S. will probably be the most attractive place on earth to invest. We will attract investment capital from around the world to finance new plants and create jobs here in America. American workers will build these plants, build the equipment installed in these plants and will be employed in these plants. Off-shore money will find its way back home and our economy will be booming like never before.

And you can laugh all the way to the bank!

MAKING THE CASE FOR CONSUMPTION TAXATION

2007-10-16T19:56:00.000-07:00

"Unlike income taxation, consumption taxation does not discourage investment because it applies a zero effective tax rate to marginal investments. Unlike wage taxation, consumption taxation imposes significant taxes on investors who earn excess returns (and those with investments in place when the tax is introduced), thereby raising revenue from a generally affluent group without undermining incentives.[6] In short,consumption taxation offers a better combination of efficiency and equity than alternative tax systems."

This quote came from an excerpt from one of our FairTax people. Think about it - it makes sense. The buy-low, sell-high theory helps the investor in this instance. The investor pays taxes when he buys the stock, or mutual fund, or whatever, but when he sells he receives the full benefit of his (HIS) profits. The affluent invest more, thus pay more taxes. They also make more money when they sell - so what. They have earned it. It wasn't given to them on a Title 9 platter (or some other number of platter). And yet, the small investor gets to keep his profits also, therefore giving him more spendable income.

The world keeps going 'round and 'round with the FairTax. It just plain stops eventually, with the income tax, or the flat tax or any other tax the politicians try to sell you on. DON'T BUY IT!

With the FairTax, you keep what you have earned, you pay taxes only on what you spend. Makes sense to me.

THIS BLOG WILL MAKE YOUR HAIR CURL!

2007-10-15T16:24:00.000-07:00

I received the following e-mail this weekend and thought it was worthy of passing it on to you. Really scary! This woman wants to take (er, tax)100% of your investment profits and give it to others - namely illegal immigrants! This is worse than communism! It's downright inhumane!

The FairTax would fix these problems. We would no longer be threatened by the likes of this politician or any other politician or lobbyist who wants your money so they can give it to someone else.

This is why it is so important that we vote for politicians who are in favor of the FairTax, both Democrat and Republican. Turn your back and they will take (tax) your money!

Here's the e-mail:
Madam speaker Nancy Pelosi wants to put a Windfall tax all stock
> market profits (including Retirement fund, 401K's and Mutual Funds!
> .... all to help the 12 Million Illegal Immigrants and other
> unemployed Minorities!
>
>
> This woman is frightening. Take special note of the last paragraph. Is
> she really this whacked out?
>
> Nancy Pelosi condemned the new record highs of the stock market as
> "just another example of Bush policies helping the rich get richer".
> "First Bush cut taxes for the rich and the economy has rebounded with
> new record low unemployment rates, which only means! wealthy employers
> are getting even wealthier at the expense of the underpaid working
> class".
>
> She went on to say "Despite the billions of dollars being spent in
> Iraq our economy is still strong and government tax revenues are at
> all time highs What this really means is that business is exploiting
> the war effort and working Americans, just to put money in their own
> pockets".
>
> When questioned about recent stock market highs she responded "Only
> the rich benefit from these re cord highs. Working Americans, welfare
> recipients, the unemployed and minorities are not sharing in these
> obscene record highs". "There is no question these windfall profits
> and income created by the Bush administration need to be taxed at 100%
> rate and those dollars redistributed to the poor and working class".
> "Profits from the stock market do not reward the hard work of our
> working class who, by their hard work, are responsible for generating
> these corporate profits that create stock market profits for the rich.
> We in congress will need to address this issue to either tax these
> profits or to control the stock market to prevent this unearned income
> t o flow to the rich."
>
> When asked about the fact that over 80% of all Americans have
> investments in mutual funds, retirement funds, 401K's, and the stock
> market she replied "That may be true, but probably only 5% account for
> 90% of all these investment dollars. That's just more "trickle down"
> economics claiming that if a corporation is successful that everyone
> from the CEO to the floor sweeper benefit from higher wages and job
> security which is ridiculous". "How much of this 'trickle down' ever
> get to the unemployed and minorities in our county? None, and that's
> the tragedy of these stock market highs."
>
> "We democrats are going to address this issue after the election when
> we take control of the congress. We will return to the 60% to 80% tax
> rates on the rich and we will be able to take at least 30% of all
> current lower Federal Income Tax tax payers off the roles and increase
> government income substantially. We need to work toward the goal of
> equalizing income in our country and at the same time limiting the
> amount the rich can invest."
>
> When asked how these new tax dollars would be spent, she replied ; ;
> "We need to raise the standard of living of our poor, unemployed and
> minorities. For example, we have an estimated 12 million illegal
> immigrants in our country who need our help along with millions of
> unemployed minorities. Stock market windfall profits taxes could go a
> long way to guarantee these people the standard of living they would
> like to have as "Americans"."

LET’S PRETEND WE HAVE THE FAIRTAX NOW!

2007-10-12T17:28:00.000-07:00

Today is Friday. It is a time for relaxation from the weeks giving to the IRS. I think you all need a boost. Therefore, I am re-publishing my favorite blog: "LET'S PRETEND WE HAVE THE FAIRTAX NOW!" Enjoy! See you Monday.

Everyone who wants one, has a job. The economy is booming!

Corporations are moving their headquarters and manufacturing
back to the USA.!

We get to keep 100% of your paycheck!

Social Security is on stable footing for the first time in years!

Medicare is paying its own way and is no longer in danger of default!

The Corporate taxes and costs of compliance hidden in both wholesale and retail prices no longer exist!

We love our monthly prebate check! The lower income people pay no taxes because of this and the rest of us get a free ride up to the amount of
the poverty level!

This means we can save more, faster and have more money available for education, home ownership and retirement!

We don’t have to fill out those stupid IRS forms anymore! We save a total of $250 billion or more (about 3% of the GDP).

The government wins too! They get the same amount of revenue they are used to getting!

And guess who has to start paying taxes for the first time in their lives?

Illegals, prostitutes, drug dealers, the porn industry, criminals, plus all of the other under-the-table transactions that take place!

Then comes the repeal of the 16th amendment – when we are sure we get the kind of FairTax we want.

Do you know what we have done? We have eliminated the IRS as we know it. No more audits (except for businesses), no more nasty letters, no more high-handed tactics.

NOW DO YOU KNOW WHAT THIS MEANS? THIS MEANS THAT APRIL 15TH WILL BE “JUST ANOTHER SPRING DAY”!

TOO POOPED TO BLOG!

2007-10-11T18:44:00.000-07:00

It's been a hard day for an old lady. It was Doctor Day today. I took Gary in to get fitted for his hearing aids. That wasn't so hard, but when we got home, I decided to go out and chop down the Iris, the lilies, the other ugly stuff left over from summer. Then Gary trudged out with the ladder and decided to pick apples. Well, that amounted to sawing off limbs to reach the apples. Now we have a real mess. I called the yard man to do that, but his phone was disconnected - I guess you get what you pay for.

All in all, it was an exhausting day. I told Gary - "I can't cook tonight, after all this". He said go get take-out. So we ordered Lasagne from Little Italy in Cornelius (they have the best pizza too). I went to get it, dragging all the way.

So that's how my day went. I am too tired to check out another research paper for you guys tonight. I suggest you check out Betty's blog. I'll bet she has some new stuff for you.

See you tomorrow...................