The problem is that the Fair Tax proposal as written, and even as modified to correct the obvious flaws, appears to have even more problems. I would favor a Flat Tax long before I would favor a Fair Tax. I gain a lot under any of the two systems, but you know, unless we can make damned sure that we will not wreck critical institutions, I would not vote for either of them.
..which Federal Agency to eliminate, which would it be?? Well, I don't know about you, but life sans IRS would be a great start. Well, there are bills in both houses that would do exactly that!! Have you even heard about this issue, they were introduced back in January!!!
Now, this is NOT the Flat Tax proposed by Forbes..it is the FAIR tax and if you take some time to read all the information, it just seems to make sense. Other than the direct impact on those whose livlihood depends on our COMPLEX Tax Code, could someone step forward and explain what's wrong with this plan? But, PLEASE take some time to fully read the information. It's going to take a grassroots effort to get Congress off their collective asses and bring this to the forrefront of important legislation! Look this is NOT to be a discussion of NO TAXATION, let's keep it real, peeps.
http://www.fairtax.org/
http://www.fairtaxvolunteer.org/main.html
Several things stood out. The Fair Tax proponents state that the Fair Tax would exempt the poor. One obvious question is how does one determine whether a person is poor? You may say the state welfare rolls. Decent try but there are millions of working poor that would warrant the exemption that do not take welfare, free school lunches or food stamps. States currently make no effort to determine who is poor and who is not at the cash register, states simply exempt some basic items that everyone need from taxes. The exemption applies to everyone that picks up those items.
In order to single out poor citizens for no taxation, states would have to correctly identify those people and give store employees some way of identifying them at the cash register. One obvious way would be to identify poor people then give them a state issued ID card that they show the person that runs the cash register. But in such a system, you would need inspectors to confirm that a person is in fact poor, inspectorts and auditors to confirm that the cards are not misused by those people and inspectors and auditors to insure that stores are applying the tax code as intended. So in effect, you shift the work that the IRS does to states, with the inherent shift in paying those people.
What incentive is there some middle class and wealthy not to cheat is such a system? The only limiter would be their honesty. Their honesty would be the only thing that prevents them from paying a poor person a few bucks to have that person "shop" for them. Oh, you say that there will be a limit on how much a poor person could spend. That is reasonable, if they spend buckoo bucks then they obviously should not be classed as poor. But in order to monitor spending by the poor, you would have to have the stores do it (more beauracracy), or have government agents check and do the did (more beauracracy and big brotherism).
Since the states will be spending more to collect taxes at the register and prevent fraud, there will be little willingness to share the receipts with the Federal Government. So where would the money to fund out Armed Services come from (Welfare, Education and other Human Services would probaly shift to states, given that the Feds could not pay for them anyway)? Maybe we will end up like Russia, one of your models, with no ability to save any of our Armed Services people from sure death. It is interesting that the only two countries that even had a remote chance of saving the seven trapped Russian sailors are ones that have the regressive tax system that you dispise.
Look, I am a high wage earner and would profit immensely from any system that reduces tax rates. But I also want such a system to be sensible and not lead to damage of institutions that allow me to pursue life freely and without heavy daily concerns. I could ban toghether with other people in my shoes to fight off the certain anarchy that will happen if we recklessly damage our ability to fund key institutions. But what assurance will I have the the people that I hire to protect me from anarchy will not simply turn the guns on me and take everything I have, including my life.
Exemptions on NEW item purchases are not implemented at the register. Rather, everyone is mailed a "rebate" to cover the cost of "essentials". Also, the tax is only on NEW items, no tax on USED items.
How many people "cheat" the curent system? More than you might imagine.
Please read all the information. It's well thought out.
As for the issue you raised about saving those Russian Sailors...it has nothing to do with what kind of tax system the rescueing countries had; rather it was countries with compassion.
The system is revenue neutral..i.e the same amount of money collected by our current system would be collected by the Fair Tax. Social Security would benefit.
Exemptions on NEW item purchases are not implemented at the register. Rather, everyone is mailed a "rebate" to cover the cost of "essentials". Also, the tax is only on NEW items, no tax on USED items - Tell me, how does the state govrnments determine who get a rebate check and how don't get one?
How many people "cheat" the curent system? More than you might imagine. - So the solution is to introduce a system which gives even more incentive to cheat. Like I wrote, the only thing that will keep middle class and wealthy people from cheating under the Fair Tax system will be their honesty level. The ones that cheat now will cheat at least as much under the Fair Tax system. My question is whether there will be more new cheaters joining their ranks because of their realization that there is no enforcement mechanism for making them pay for cheating.
Please read all the information. It's well thought out. Sorry my friend, I read it and found it to have more holes than good Swiss cheese.
As for the issue you raised about saving those Russian Sailors...it has nothing to do with what kind of tax system the rescueing countries had; rather it was countries with compassion. It had everything to do with Russia not having the money to properly fund it's Navy and other Armed Services. Yes compassion was involved, but only because the British and USA did not want to see those men suffocate. The Russians clearly showed that they did not have the technology or funds to prevent the men's deaths.
The system is revenue neutral..i.e the same amount of money collected by our current system would be collected by the Fair Tax. Social Security would benefit. Using myself as an example, the system is not revenue neutral. I earn two to three times as much as many people that I see in checkout lines, yet my total bill come out as a fraction of what they spend. Because of where I live, I see precious few "poor" people shopping around me. Under the Fair Tax system, those people will pay just as much taxes as they pay now at the checkout counter while gaining some from no income taxes. I will gain a large amount from having no income taxes, given my marginal tax rate bracket, and almost surely would not change my spending habits.
I do not want to waste time on it. Here's one problem: It will require the repeal of the 16th Amendment before it can be enacted. The key word here is BEFORE. Do you really think that any politician or administration is going to risk repealing that amendment and then have to fight out this bill? That would be quite a gamble.
YOUR attitude! The benefits of implementing this radical change are so overwhelming. It's truly going to take a grass roots effort; but once the momentum starts to build, solutions for any minor hump in the road will be worked out.
Look, our current situation is abhorent, it's time for a change! This is something that CAN happen.
The problem is that the Fair Tax proposal as written, and even as modified to correct the obvious flaws, appears to have even more problems. I would favor a Flat Tax long before I would favor a Fair Tax. I gain a lot under any of the two systems, but you know, unless we can make damned sure that we will not wreck critical institutions, I would not vote for either of them.