opinions on the fair tax?

Question

read the website and tell me your opinion
http://www.fairtax.org/site/PageServer

whats your opinion?


please dont get on about the rich , we arent going there

i believe this would create more jobs and would help alot of the ppl that need it , thats my opinion

its 23% and you get money every month obviously you didnt read the whole site

Answer 1

The Fair Tax is a proposal that was developed by leading economists from major universities and research organizations. They are not "inside the beltway" lobbyists or politicians. There was over $22,000,000 spent doing the research and development of the plan. Can anyone identify any other tax proposal that has had that much research done before it was introduced to congress? There are over 80 economists, cpas, tax experts and others that have endorsed the plan. The only critics of the plan do one of two things; they either out right lie about it or they change the plan and then object to their changes! People that listen to these critics and voice their objections have not looked into the actual plan or listened to the rebuttals.

The website www.fairtax.org has all the details of the Fair Tax plan itself, therefore I will let people do their own research, but rather I am going to respond to some misconceptions.

The prebate does not go to the poor and low income people. I goes to every legal household in America, if they apply for it. Bill Gates can apply and receive the prebate. If the $6325 he would receive means that much to him, but he might not file for it.

Under the current Income tax System, a worker pays 7.65% SS tax and over 1% Medicare on their wages up to the MAX. The base income tax rate is 15%. Adding these two taxes together, the worker is paying 23.65% on their earnings and pay the taxes on their personal income tax return. They also pay the embedded taxes on everything they buy. At the retail level this is approximately 22% the total they spend. Combined, the worker is paying out about 45% of their money in Income Tax costs. This does not include the lost time and work they have to exhaust maintianing records, collecting information and paying for their taxes to be filed. The average person will spend about 57 hours to prepare their tax return. You can calculate what the cost of this is for your own personal position.

Businesses do not pay any taxes. These are another cost of doing business and add to the cost of everything you buy. Elinimate taxes on businesses and the price of items will go down by that amount.

There are two reasons why politicians want to maintain the income tax system. First they would lose their power and control of the taxes. Currently they can reward their "friends" by giving them tax breaks, penalize their "enemys" by increasing taxes on them and doing their social engineering. The second thing is that the politicians LOVE embedded taxes. You do not see how much you are paying in taxes, therefore you do not complain that you are paying too much in taxes. Under the Fair Tax, all the taxes will be reflected on the cash register receipt. People will then know exactly how much taxes and will tell the politicians to cut back on their spending. Having a number of different taxing programs only helps to hide what taxes you are paying. That is the wrong way to go.

The Fair Tax does not effect any of the spending side of government operations. Social Security and Medicare will be fully funded and will not go away.

The Fair Tax is set up to be revenue nutural to the feds at the time it is implemented. It is estimated that the Gross Domestic Product will increase over 10% in the first year. This will generate more revenue to the feds. This could be used to reduce the national debt. Congress could easily lower the sales tax rate to match the current level of spending. (But knowing Congress, they will create ways to spend this increased revenue! We must control this.)

People need to understand that the Fair Tax is a non-partisan plan. While the vast majority of Co-Sponsors are Republicans, below is a paper that explains why Democrats should Co-Sponsor the Fair Tax. Nancy P. does not want to lose her power and control, therefore she told the Democratic Representatives not to Co-Sponsor the Fair Tax or she would assign them to the committees she wants them on.

Answer 2

The website is goshawful slow, so I'm not going to mess with it. Having already read up on the topic, and had lengthy debates with Congressional candidates supporting it, I think I know enough about it.

There is a very good reason for the variety of taxes we have: any single tax tends to impact some people far more than others, and spreads its burden unfairly. With multiple taxes, each of the burdens tends to spread differently, and therefore the total load can be (I do not claim it necessarily is) more evenly spread throughout the population.

A giant sales tax ignores one of the major effects of the tax changes we have been living with for two and a half decades: wealth is being concentrated. More and more of the people in this country live hand-to-mouth, or close to it.

This proposal relieves people from any tax burden at all on any money they don't spend. That is a huge advantage to those who have income beyond their needs. Strangely enough, these are the same people who have been kvetching about inheritance tax for years, calling it double taxation, in spite of the fact that the tax system has been re-engineered to move money from the less fortunate into their bank accounts the entire time.

The fact that the proposal has been tweaked to attempt to relieve the burden on those below the poverty line is a flat admission that this tax puts additional burden in the wrong place to begin with.

Cute tax theories based on oversimplifying the problem are a dime a dozen. If you really want fairness, look at whether or not a tax system is concentrating wealth. We run a fresh experiment on that every year, and the results have been consistent for decades.

A tax system that favors the wealthy is not just unfair, it is inefficient; it sucks vigor from the economy. A tax system that spreads wealth a bit would also be unfair, but might actually benefit everyone: people who spend what they get actually drive the economy into more prosperous conditions.

This allegedly fair tax would actually drive the economy deeper into stagnation and closer to a banana-republic model.

Answer 3

I have read the Fair Tax books and have spent time on the site, and I like the Fair Tax for a lot of reasons and also dislike it for a lot of reasons.


The TWO main reasons I like the Fair Tax:

ONE - it removes the government from personal lives as we no longer have to explain what we do with our money nor have to consider the tax consequences of investing. While the government will still be involved in the lives of business via having the retail sector report incomes, this is still better than the current system.

TWO – it shifts the burden of taxes to those who consume. While the rich will benefit far more initially since the rich consume a far lower percentage of their income, I actually think this is a benefit to society as it incentivizes even the lower classes to curb their spending. There is a large portion of this society that is deemed poor living paycheck to paycheck yet somehow can afford TVs, designer clothes, etc…and under the current system it only perpetuates this mentality. While it should be obvious to anyone with money management discipline that curbing spending in these situations it vital, the reality is it is not to many people and thus a Fair Tax added to the cost of goods will further help transition the mindset into spending within one’s means.


That being said, I do NOT support the Fair Tax for THREE main reasons:

ONE – It is a transitional nightmare that can never be considered fair. If I am retired and have $100,000 in the bank of after tax dollars, once the Fair Tax is implemented I am forced to either rush out and spend it before the Tax is applied, or I am subject to being taxed on the money all over again. One might conclude that few people have lump sums of money sitting in the bank, and that might be true; however replace that lump sum with any investment built with after tax dollars and you suddenly are talking about the vast majority of middle class America. Hardly fair.

TWO – The premise of the prebate is noble…to make the tax less regressive. However, you must consider that once a prebate is established and the middle and lower classes become accustomed to receiving this prebate, its only a matter of time until a large portion of society considers the prebate as part of their budget. As soon as part of society starts spending and includes a prebate into that calculation, you have a portion of society that can no longer survive their lifestyle without government aid. This might be the dream of a Marxist society, but anyone with even a rudimentary economic background understands that a society dependant on their government cannot sustain itself as a free society.

THREE – It is foolish to spend so much time discussing how we tax people when the real issue is out of control spending. If we actually put some controls on spending, the "how" part of collecting taxes would be far less an issue. Putting such emphasis on the means of collection only stands to further distance ourselves from the root of the problem. This is far and away the most critical of all issues, and the even the fairest of all tax collection systems will not stand if we continually spend more than we collect.



Lastly, there are some misconceptions or blatant illogical statements constantly made about the Fair Tax that I want to quickly address.

First, many have stated that due to all the embedded taxes currently in the cost of goods, that prices will go down. This of course is quite logical; however, when you consider that all those embedded taxes are still going to be collected in the Fair Tax, and the Fair tax is added right back on top of prices, this really means little, as they are the same taxes with a different name. What is NOT logical is to expect the net cost of good to go down, because in addition to the embedded taxes being removed and then put right back on, you are also adding all the once collected income taxes on to prices as well…so the only conclusion if we are going to maintain the same overall collection of taxes is that net prices will go up for everyone.

Second, there is a claim that we will have an infusion of new taxes because of the underground economy that currently pays no income taxes that suddenly will be paying sales tax. While ideally this would be true, and hopefully it would be to a certain extent, it is quite logical to expect that those same individuals on a whole that illegally make money without paying income taxes in the current situation would also be the same class that would buy goods underground to avoid paying sales taxes. We need only look to the VAT to see the large abundance of tax avoidance that still exists under such a plan. Thus this claim can only be justified in a theoretical sense of hope.

I hope this has given some insight to the issue for you.

Answer 4

The web site says that the fair tax would replace income tax and payroll taxes.

That means that social security won't be funded, and neither will unemployment benefits, which come from FICA, FUTA and SUTA taxes (and it means that state unemployment taxes would have to go up).

I think they should propose something that replaces only the income tax. The payroll taxes are simple and they're not in a mess. It's the income tax that has government oppression built in by imposing penalties and interest on people who sometimes don't even know they've broken the law.

Just replacing that system is good enough for me.

Answer 5

It should be properly called what it is, the unfair tax. This is just one more boondoggle by the far right extreme to avoid paying taxes and pushing those taxes onto the working poor. We all use a car and a television. Why should the poor working class person pay the same as the millionaire?

Answer 6

Let's see...a 35 percent sales tax.....I think not

Do the math in order for the numbers to work it workds out to 35 % Bob Brinkerr did a great segment on it. Regressive taxes are not a smart move.

Answer 7

there is nothing fair about it.

do you want to pay 30% on every item you buy and on every service you receive???

follow the money. she who wants it the most and you will get a clue.

do you want to pay 30% when you buy a house. That is $30,000 on a $100,000 house. That is, if you can find a $100,000 house.

http://www.libertariantv.com/articles/Unfair-Tax.asp

http://blogs.chron.com/lorensteffy/2005/09/unfair_promise.html

http://www.itsyourtimes.com/?q=node/3396

Answer 8

Why should we penalize people who are sucessful ? We should all pay the same percentage. Thats fair !

Answer 9

I think people who are against it are misinformed. I have never met anyone who read (and understood) the Fair Tax book and thought it was a bad idea.

Answer 10

It is stupid and will never pass a democrat congress or senate. this clown is only advocating this tax to bs republican voters...... just like his bs immigration plan....it's huckabee's snake oil.