Death and taxes... but we can't change death

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bace135 in the house tonight!
Member Since: Jan 28, 2003

I remember a short discussion some time ago about alternative tax plans (alternative compared to the current setup). Anyhow, I recently came across one that I thought had potential. I thought I'd share it with you guys and see if anyone had any thoughts.

www.fairtax.org/site/Page...HowFairTaxWorks

Basically it's a national sales tax on all goods and services, and eliminates the need for income tax (no IRS) and payroll tax. There is a "prebate" so you only effectively get taxed on goods and services once you've passed a certain level of purchases (basically so people are not taxed on life necessities, it's explained better on the website I linked to).

Any thoughts?

As this ventures into political territory, just a reminder to be nice and accept that not everyone holds the same beliefs as you, and we should be able to discuss without getting upset/offended.

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Administrator
Since: Apr 03, 2002


Nov 18, 2012 01:01 pm

Nice disclaimer on the end of your post...and well stated...and I love these discussions, as long as they don't go downhill into douchebaggery and insulting...as long as you all admit I am right and you are wrong :-) LOL

I have long been a proponent of a, what I call, consumption tax...as I believe one should not be taxed on what they earn, but what they spend, this would encourage saving, and create a more stable economic environment. That being said, I disagree with the concept of not having one under a certain level of income...that doesn't (as I see it) make me seem heartless or without compassion, as I do have it, but I don't agree with breaks on the lower end of income any more than I agree with (ok, here comes baseless buzzwords) loopholes and breaks for tax breaks on the top end...I believe in flat tax across the board, period.

For the top end of earners, this means no loopholes and breaks, and for the bottom end means encouragement to do better for themselves and work for it, which is the basis for a vibrant economy, and plays to the best and worst aspects of human animals.

I do, however, believe this will NEVER happen, as it will increase taxes on the wealthy (read, influencial power brokers and lawmakers) so as a default fallback, I further second the notion of a flat tax RATE across the board, which is vastly more likely, though still not very.

bace135 in the house tonight!
Member
Since: Jan 28, 2003


Nov 18, 2012 08:21 pm

I don't have such clear thoughts about the issue, but I do feel strongly that the tax code needs to be simplified. With that being said, I'm not really into a flat rate income tax in its most basic form. I would be open to a simple tiered system though.

I had never thought of a consumption (sales) tax in terms of a national tax before, but I think this one makes sense. It's basically what you said you wanted, dB, everyone treated equally based on how much you spend. The reasons why I don't think it will happen are two-fold...
1) Banks don't really want people to save, they want people to borrow and this encourages saving.
2) All the tax accountants and the whole IRS will basically disappear, and they will fight to keep things as they are.

Administrator
Since: Apr 03, 2002


Nov 18, 2012 08:28 pm

The other main reason it won't happen is cuz the wealthiest and most powerful people would be paying a lot more taxes based on the consumption tax. I am not one that falls for the class warfare schtick of "hate the rich", but in that case, yeah, they wouldn't go for it, and it would be just them, and their cronies, that would need to pass the law.

I do agree with you though, the tax code is insane, stupidly complex, but see the same issue, simplifying it to a flat tax rate code would create hordes of unemployment with IRS layoffs...

Byte-Mixer
Member
Since: Dec 04, 2007


Nov 18, 2012 11:06 pm

I try to steer clear of politics as much as I can. However, I have some views of my own.

First off, I agree with the concept of the flat or fair tax system. Second, I also agree with taxing on material items, not on one's income.

While not exactly speaking of taxes themselves, but on a subject that is influenced by taxes: job creation.

I know there are talks of cutting taxes for the corporate/wealthy folks to encourage them to hire more people, and thus create jobs, but....I think that system is flawed at best. I think for that to work, you would have to have some sort of regulation as to how the extra money is spent, and that involves gubment invading the free market somewhat. I don't like that one bit.

Something I would like to see (although it is somewhat gubment with hands in the cookie jar) is some type of program to encourage self-starters and new businesses, and an increase of successful entrepreneurs. Something that will cut taxes from self-employment so that self-starters are encouraged to make more profit, and expand their interests to create jobs from that angle.

I think our nation needs a solid increase and solidification/hardening of the foundations. I.E. us, the average Joe. The problem there, however, is that large corporations could easily just match or beat prices offered by your typical self starter. And I think that has always been a problem.

But, if we had some sort of program (read: not stimulus or any of that crap) to help self-starters get their feet on the ground and an aid in becoming successful (maybe delay self-employment taxes until the business meets a certain profit margin?) so that the foundation can start growing again and maybe offer some real healthy competition to your typical big box stores and whatnot, maybe that would offer some hope to future generations.

I think right now, the market is overly top-heavy, like an upside down pyramid that is precariously balanced, and one wrong weight could make the whole thing topple over. Maybe I'm wrong, but it's something I've been thinking about since the whole R/O tax agendas prior to the election.



Oh, and as an aside to all this, completely unrelated: while we're restructuring the market....can we expunge the RIAA? :D

Administrator
Since: Apr 03, 2002


Nov 19, 2012 05:27 am

I agree with the issue of helping self starters and this could be done easily by eliminating, or, making optional, social security, which self employed people have to pay ALL of. Employed folks have half payed by them and half by the employer...self employed folks have to pay all...and since gubment has borrowed against it and never repaid it, it's very likely my generation or almost positively my kids generation, won't even see any benefit from that extortion.

The self employed get screwed in many ways when it comes to taxes and the tax breaks for the wealthy to create jobs, is a falsehood as I see it. These folks will hire and fire who they need to in order to run their businesses regardless of those taxes.

Again, I hold no anger or vitriol against the wealthy for paying less, I hold all that against those lawmakers that have created such a tax code...don't hate the players, hate the game.

That leads me to my final point, having zero deductions or adjustments for any reason....everyone seems to have their pet reasons to offer tax breaks...for some it'd kids, for some it's education, for some it's self employment, or any number of other reasons...as I see it, even one single deduction or adjustment being present in the tax code leaves the door open for more and in a few generations we would wind up right back in the fuster cluck we have right now.

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