# Taxes: VAT - Flat - Fair: Your opinion?



## Wolf mom (Mar 8, 2005)

VAT - FLAT - FAIR - or stay the same - And why?

Well, it ain't gonna stay the same, so how do you believe the country should move? There's a lot of talk about the VAT these days. I think we're all going to have to become aware of the pro's and con's of each. 

"O" did say he's not going to raise taxes on those making below 250,000 so lets get that broken promise out of the way & concentrate on taxes....

I'd like to see a Flat tax, but the implementation would be mindboggling for some, as they really like those deductions/transfer payments/subsidies. I don't think it's be hard - no rewriting the millions of words for a new tax code. No large IRS staff- although many people would be out of a job. Maybe retraining would be part of the "parting package"? 

Whatcha' think?


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## poppy (Feb 21, 2008)

Fair tax is best. Flat tax is next best. VAT is what we will get. The problem with the VAT is that it will be on top of income taxes where the other 2 would replace it. The VAT is an insidious tax system. It always starts out low and raises quickly because it is an unseen tax and government never gets tired of spending money. I see the VAT tax in some European countries is up to 22% now. Greece has one and they are still bankrupt, so it does not solve any country's financial problem.


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## blooba (Feb 9, 2010)

I say get rid of all taxes and just have tariffs although they would have to cut spending by 99% .completely doable but will never happen.


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## palani (Jun 12, 2005)

Why do you WANT to be taxed?

There are no public officials anymore. Merely private citizens who see the need in a vacant office and volunteer to fill the need. Then comes the demand for payment for their services and the need to "budget" and "economize" to pay their salaries, their health care and their generous retirement benefits.

As none are public but instead are private I would be willing to thank them for their service, sue them when they trespass and ignore them at all other times.


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## Win07_351 (Dec 7, 2008)

I'd say some sort of a national sales tax on most items.

Taxing a persons income and property is not Biblical


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## tyusclan (Jan 1, 2005)

poppy said:


> Fair tax is best. Flat tax is next best. VAT is what we will get. The problem with the VAT is that it will be on top of income taxes where the other 2 would replace it. The VAT is an insidious tax system. It always starts out low and raises quickly because it is an unseen tax and government never gets tired of spending money. I see the VAT tax in some European countries is up to 22% now. Greece has one and they are still bankrupt, so it does not solve any country's financial problem.


Agree 100%.


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## Wolf mom (Mar 8, 2005)

Why do you think the Fair tax is better than the Flat Tax?? What do you consider the main difference?

yes, I agree the VAT is an insidious tax on top of the way we are already taxed.

Win07, so are you saying that we should have ONLY a National Sales Tax after repealing all other current taxes? - or on top of current taxes?


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## where I want to (Oct 28, 2008)

What is a Fair tax?


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## poppy (Feb 21, 2008)

where I want to said:


> What is a Fair tax?


Google it because it is a lot to go into in a post. It is well thought out. The tax would be embedded in everything you buy. You would have no payroll deductions for income tax or Social Security. Everyone would get a prebate at the first of every month to prepay you for the Fair Tax for basics like food according to your family size. Rep. John Linder have a couple books out explaining it in detail.


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## MariaAZ (Jun 5, 2007)

I like Wolf mom's stance. The fair tax, with its prebate, sounds to me like it would require a higher level of administration than a flat tax. However, I think flat OR fair would be preferable to what we have now.


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## blooba (Feb 9, 2010)

Win07_351 said:


> I'd say some sort of a national sales tax on most items.
> 
> Taxing a persons income and property is not Biblical


The problem with VAT or sales tax is that you are benefiting the rich and taxing the poor a bigger percentage.

When someone makes $25,000/yr they will be spending it all so all of that money will be taxed.

So 100% of his money was taxed.

When someone makes $5 million/yr they will only be spending (maybe) $2 million so the other $3 million will not be taxed. 

So only 40% of his money was taxed.


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## Txsteader (Aug 22, 2005)

I'll have to do more research on the fair tax before being able to decide between it and the fair tax, but I'm adamantly opposed to the VAT. I think it's bad for consumers, bad for business and bad for the overall economy.


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## deaconjim (Oct 31, 2005)

A tax on income is wrong, regardless of the rate. We should not tax earning, saving, or investing, as those are behaviors that we should encourage. 

The Far Tax, while not perfect, is the best system I have seen to date. The process is simple, un-intrusive, and as fair as I believe we can make it. 

The VAT is nothing more than a way for the politicians to rob us blind. It proves Rep. Tom Periello was right when he said (of Congress) &#8220;If you don&#8217;t tie our hands, we will keep stealing.&#8221;


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## deaconjim (Oct 31, 2005)

blooba said:


> The problem with VAT or sales tax is that you are benefiting the rich and taxing the poor a bigger percentage.
> 
> When someone makes $25,000/yr they will be spending it all so all of that money will be taxed.
> 
> ...


Read up on the Fair Tax. You might like it better than you think.


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## poppy (Feb 21, 2008)

blooba said:


> The problem with VAT or sales tax is that you are benefiting the rich and taxing the poor a bigger percentage.
> 
> When someone makes $25,000/yr they will be spending it all so all of that money will be taxed.
> 
> ...


But the guy paying taxes on 2 million in spending is paying about 80 times the taxes of the guy spending 25K. I still do not like the VAT. I do believe EVERYONE should have to pay SOME kind of tax as long as they vote. Right now we have nearly 50% of people mooching off the other 50% and these bums need to share the pain.


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## deaconjim (Oct 31, 2005)

blooba said:


> The problem with VAT or sales tax is that you are benefiting the rich and taxing the poor a bigger percentage.
> 
> When someone makes $25,000/yr they will be spending it all so all of that money will be taxed.
> 
> ...


That $3 million will be invested (even if it's just sitting in an interest bearing savings account), which is good for the economy.


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## Batt (Sep 8, 2006)

blooba said:


> The problem with VAT or sales tax is that you are benefiting the rich and taxing the poor a bigger percentage.
> When someone makes $25,000/yr they will be spending it all so all of that money will be taxed.So 100% of his money was taxed.
> When someone makes $5 million/yr they will only be spending (maybe) $2 million so the other $3 million will not be taxed.
> So only 40% of his money was taxed.


That is why you need to do your research before you just go blathering on. With the PREBATE a person with a $25,000 income would pay very little or no taxes. Someone with $5M income, only on what he spends. 

Illegals working for cash, 100% of what they spend and don't send home. People working under the table such as prostitutes, drug dealers would have to pay the tax on what they spend instead of $0 they do now.

The fair tax would make the USA the biggest tax haven in the world. Maybe some of those jobs that were sucked away would return.


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## blooba (Feb 9, 2010)

poppy said:


> But the guy paying taxes on 2 million in spending is paying about 80 times the taxes of the guy spending 25K. I still do not like the VAT. I do believe EVERYONE should have to pay SOME kind of tax as long as they vote. Right now we have nearly 50% of people mooching off the other 50% and these bums need to share the pain.


 Exactly, a flat income tax with no credits or deductions(loopholes) of around 7-11% means someone making $100/yr will be forced to pay in $7-$11 and someone making $5 million would be forced to pay $350,000-$550,000. Thats the only fair way, of course any such welfare that's not abolished should be taxed also(including the value of medicaid or whatever "benefits" they reap)

P.S. I wish all welfare would go away but I think that is a pipe dream



deaconjim said:


> Read up on the Fair Tax. You might like it better than you think.


Not really, I have readup on many taxation ideas and know the histories, benefits, and downfalls of each tax in multiple countries. This country was founded on tariffs which discourage importing and being self reliant as a country although for us to get back to that model we will have to cut spending drastically. It's possible to do although will take many years.


deaconjim said:


> That $3 million will be invested (even if it's just sitting in an interest bearing savings account), which is good for the economy.


It's good on the economy although it will raise the middle classes tax burden. 

Right now everyone (except the welfare moochers) pay @ 30% in Federal Income taxes give or take 10% or so with all the loopholes(capital gains tax,deductions and credits). The top 5% of income earners make 60% of all income ($160k and above). They also pay 60% of all income taxes collected. It is fair to say you can live nicely on $160,000/yr and not spend anymore than that $160,000.

So now you would losing the ability to tax 60% of all income made in the U.S. so you would be forced to raise taxes 60% on middle class people(making less than $160,000). I'm not to sure about you but I definitely cannot afford a 60% tax increase.


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## blooba (Feb 9, 2010)

Adron said:


> That is why you need to do your research before you just go blathering on. With the PREBATE a person with a $25,000 income would pay very little or no taxes. Someone with $5M income, only on what he spends.
> 
> Illegals working for cash, 100% of what they spend and don't send home. People working under the table such as prostitutes, drug dealers would have to pay the tax on what they spend instead of $0 they do now.
> 
> The fair tax would make the USA the biggest tax haven in the world. Maybe some of those jobs that were sucked away would return.


Well with adding in the prebate you are raising the tax increase explained above to an even higher number. The government should not have the right to say how much we should or should not spend to live. You are just asking for corruption and messing with the numbers to increase taxes as the cost of living rises.

The illegals problem would be solved with motion activated machine guns or snipers on the border, after we ship em all out of course. 

Yea, the drug dealers and prostitutes will fall under the radar although bartering will fall under the radar with a national sales tax. Every tax law except tariffs will have ways around it. That's why the founding fathers enacted tariffs and nothing else. 

I have done my research and suggest you do to. Before we go changing things we need to make sure we don't replace one screwed up idea with another. That's what we're doing now and look at what's happening to this country. It's just like trying to fix Medicaid with the National Health Insurance Mandate. It just won't work.


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## Dr. Mom (Jan 13, 2008)

Blooba, I encourage you to read the Fair Tax Book by Neal Boortz. Here is a sample of the first chapter. The concept is excellent and quite do-able. The only problem is that it limits the powers that congress has on the private citizens. Oh dear! It does away with the IRS so those people will have to find other employment. But it will bring factories and industries back that have gone overseas to avoid being taxed out of existence. When you read the book and understand the concept, then you will realize that any other imposed taxes make no sense at all. It will take an act of God to get the Fair Tax passed through the current congress, though. 

http://search.barnesandnoble.com/FairTax-Book/Neal-Boortz/e/9780060875411#CHP


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## blooba (Feb 9, 2010)

Dr. Mom said:


> Blooba, I encourage you to read the Fair Tax Book by Neal Boortz. Here is a sample of the first chapter. The concept is excellent and quite do-able. The only problem is that it limits the powers that congress has on the private citizens. Oh dear! It does away with the IRS so those people will have to find other employment. But it will bring factories and industries back that have gone overseas to avoid being taxed out of existence. When you read the book and understand the concept, then you will realize that any other imposed taxes make no sense at all. It will take an act of God to get the Fair Tax passed through the current congress, though.
> 
> http://search.barnesandnoble.com/FairTax-Book/Neal-Boortz/e/9780060875411#CHP


well I'm not going to buy every book published about taxes but since you have read this book, how is my above scenario wrong?

Tariffs would also be able to abolish the IRS, Customs are already are supposed to check all incoming freight(although they dont) they could value and charge the tariffs on the spot. It would also provide a BIG incentive on bringing companies back.


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## Shygal (May 26, 2003)

Where does the money for the prebate come from?


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## ET1 SS (Oct 22, 2005)

I have no problem with how our tax system works now.

Low income brackets pay a lower rate of taxes; higher income brackets pay a higher rate of taxes.

And there are write-offs for healthcare, housing, business expenses, education expenses, ...

Plus if you are raising children there are additional credits.

So what is the problem?


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## deaconjim (Oct 31, 2005)

Shygal said:


> Where does the money for the prebate come from?


The money comes from the funds collected from the sales tax itself.


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## blooba (Feb 9, 2010)

ET1 SS said:


> I have no problem with how our tax system works now.
> 
> Low income brackets pay a lower rate of taxes; higher income brackets pay a higher rate of taxes.
> 
> ...


Well for one, A lower income person like me doesn't have money to move around to qualify for all the looholes. 
you are allowing the rich to move more money into those loopholes(deductions and credits) So in essence they are paying the same or less.

Secondly, what gives the government the right to practice social engineering on the citizens? 
I don't want kids although I am getting punished for it. 
I don't need a college education since I make decent money doing what I do so I am being punished.

I prefer not to have kids for multiple reasons but I reasonable cannot afford them (without government payouts and credits) BUT I am being forced to pay for your kids. Children are a tax burden and really should be charged for. I know that would be wrong in many peoples eyes but I definitely shouldn't be paying you to have kids for me to pay for them.

Why should I be charged extra for "living outside the box"?


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## watcher (Sep 4, 2006)

The "fair tax" isn't. 

1) The less you make the lower your real tax rate. Example let's say the 'prebate' is $5,000 and the sales tax is 20% Person A makes $25K, he gets taxed $5,000 but gets back $5,000 which gives a 0% tax rate. Person B makes $75K, he gets taxed $15,000 minus his $5K prebate he is paying 13%. Person C making $250K pays $45K for a 18% tax rate. 

2) It still gives the government too much control, the ability to buy votes "adjusting" the system and to be pressured by lobbyist. How much is the prebate? What items are going to be tax free? If you have an income of millions of dollars should you even be allowed to get a prebate? Look at the history of the income tax.

The only fair way to do an income tax is a flat rate with no, none, zero deductions and/or exemptions. You take the amount of money you made, multiply by a number and send a payment to the government for that amount. That is fair for everyone and it prevents the government from being able to use the tax system to control people and their actions.


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## deaconjim (Oct 31, 2005)

watcher said:


> The only fair way to do an income tax is a flat rate with no, none, zero deductions and/or exemptions. You take the amount of money you made, multiply by a number and send a payment to the government for that amount. That is fair for everyone and it prevents the government from being able to use the tax system to control people and their actions.


How does it prevent the government from using the tax system to control people?


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## blooba (Feb 9, 2010)

deaconjim said:


> How does it prevent the government from using the tax system to control people?


Because it doesn't matter if you make $10 or $10 billion you are taxed the same percentage. No social engineering!! No loopholes!!!


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## deaconjim (Oct 31, 2005)

blooba said:


> Because it doesn't matter if you make $10 or $10 billion you are taxed the same percentage. No social engineering!! No loopholes!!!


What stops them from passing new loopholes or exemptions?


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## blooba (Feb 9, 2010)

deaconjim said:


> What stops them from passing new loopholes or exemptions?


Well that's the entire point, what's keeping them from corrupting any tax system like they have our current one? THE CITIZENS, only you and I (and 300+ million others) have a say in what goes on in our government. Everyone needs to make their voices heard and I'm not talking about just on this forum, I'm talking EVERYWHERE. Your congressmen, your neighbors, your coworkers they all have a say and until we stand up for what we believe in we will keep getting trampled over.


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## deaconjim (Oct 31, 2005)

blooba said:


> Well that's the entire point, what's keeping them from corrupting any tax system like they have our current one? THE CITIZENS, only you and I (and 300+ million others) have a say in what goes on in our government. Everyone needs to make their voices heard and I'm not talking about just on this forum, I'm talking EVERYWHERE. Your congressmen, your neighbors, your coworkers they all have a say and until we stand up for what we believe in we will keep getting trampled over.


That doesn't seem to be working very well at the moment.


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## blooba (Feb 9, 2010)

deaconjim said:


> That doesn't seem to be working very well at the moment.


If you have done your research and think social engineering,loopholes and variable taxes is fair with the prebate system on your "fair" tax then lobby for it. I'm just trying to show you where it lacks and am proposing a better solution (in my mind)

The problem was that the conservatives relaxed and the liberals stood up. This election hopefully will change things as long as you(and all other conservatives) don't stop standing up for your ideas.


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## deaconjim (Oct 31, 2005)

blooba said:


> If you have done your research and think social engineering,loopholes and variable taxes is fair with the prebate system on your "fair" tax then lobby for it. I'm just trying to show you where it lacks and am proposing a better solution (in my mind)
> 
> The problem was that the conservatives relaxed and the liberals stood up. This election hopefully will change things as long as you(and all other conservatives) don't stop standing up for your ideas.


I believe the prebates are fair because everyone will get one, and it will be the same for all. I don't think there is a perfect system, but the Fair Tax is the best I've seen. Yes, it is progressive in nature, but I'd rather have that than have a tax on earning. I don't believe there should be any kind of tax on earning, saving, or investing.


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## blooba (Feb 9, 2010)

deaconjim said:


> I believe the prebates are fair because everyone will get one, _*and it will be the same for all*_. I don't think there is a perfect system, but the Fair Tax is the best I've seen. Yes, it is progressive in nature, but I'd rather have that than have a tax on earning._* I don't believe there should be any kind of tax on earning, saving, or investing.*_


No it won't. According to this prebate schedule.http://www.fairtax.org/site/PageServer?pagename=about_faq_answers My prebate would be $2,491 and someone that pops out 3 kids with a spouse would get a prebate of $7,562. That's three times bigger than my rebate so not only will i be paying you a bigger prebate but I will be paying for your kids schooling and what not. How's that "fair"?

It's social engineering, plain and simple.

And your not taxing earnings, savings, or investing will remove over 60% of tax revenue, how do propose we make up for that?


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## deaconjim (Oct 31, 2005)

blooba said:


> No it won't. According to this prebate schedule.http://www.fairtax.org/site/PageServer?pagename=about_faq_answers My prebate would be $2,491 and someone that pops out 3 kids with a spouse would get a prebate of $7,562. That's three times bigger than my rebate so not only will i be paying you a bigger prebate but I will be paying for your kids schooling and what not. How's that "fair"?
> 
> It's social engineering, plain and simple.
> 
> And your not taxing earnings, savings, or investing will remove over 60% of tax revenue, how do propose we make up for that?


The prebate is based on the number of people in the family. Larger family = larger prebate. There is no social engineering involved. The prebate is simply designed to allow you to avoid paying taxes on the money needed to pay for the basic necessities of life.

The tax rate is designed to be revenue neutral at the time of passing the legislation. The fact that earning, saving, and investing aren't taxed means that people have more freedom and incentive to engage in those activities, which then stimulates the economy, producing more income for people, giving them more to spend, and in the end producing more tax revenue.

If you haven't already done so, get a copy of the Fair Tax book by Neal Boortz and read it. He also has a second book which answers a lot of the questions and issues raised by critics of the plan. Boortz explains all of this much better than I can.


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## blooba (Feb 9, 2010)

deaconjim said:


> The prebate is based on the number of people in the family. Larger family = larger prebate. There is no social engineering involved. The prebate is simply designed to allow you to avoid paying taxes on the money needed to pay for the basic necessities of life.
> 
> The tax rate is designed to be revenue neutral at the time of passing the legislation. The fact that earning, saving, and investing aren't taxed means that people have more freedom and incentive to engage in those activities, which then stimulates the economy, producing more income for people, giving them more to spend, and in the end producing more tax revenue.
> 
> If you haven't already done so, get a copy of the Fair Tax book by Neal Boortz and read it. He also has a second book which answers a lot of the questions and issues raised by critics of the plan. Boortz explains all of this much better than I can.


ok, well its hard to find info on the U.S.'s Personal Consumption Expenditure but I did find a 2005 figure of $15,816 per individual *(seems kinda low but maybe right today) but that would equal @$4.9 Trillion dollars spent in the U.S. We would have to enact a 100% national sales to equal the revenue we have now and we still haven't covered our deficit or paid out the prebates. Is doubling the price of all goods and services really sound like a good idea to still be in the same broken boat we are in today? Hopefully my numbers are wrong.


*the consumption expenditure excludes owner-imputed rent, compulsory deductions on the personal income as well as private pension insurance, life insurance, and other expenditures that do not translate directly into acquisition of goods and services. Included is non-monetary expenditure (consumption of self-supplied goods and services).


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## deaconjim (Oct 31, 2005)

blooba said:


> ok, well its hard to find info on the U.S.'s Personal Consumption Expenditure but I did find a 2005 figure of $15,816 per individual *(seems kinda low but maybe right today) but that would equal @$4.9 Trillion dollars spent in the U.S. We would have to enact a 100% national sales to equal the revenue we have now and we still haven't covered our deficit or paid out the prebates. Is doubling the price of all goods and services really sound like a good idea to still be in the same broken boat we are in today? Hopefully my numbers are wrong.
> 
> 
> *the consumption expenditure excludes owner-imputed rent, compulsory deductions on the personal income as well as private pension insurance, life insurance, and other expenditures that do not translate directly into acquisition of goods and services. Included is non-monetary expenditure (consumption of self-supplied goods and services).


Without doing some research on the plan, it's hard to understand how and why it works. On the surface it doesn't sound like a good idea, and I was a sceptic at first. That changed completely once I fully understood the plan.

Go here and read about it, I think it will help.


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## Dr. Mom (Jan 13, 2008)

blooba said:


> well I'm not going to buy every book published about taxes but since you have read this book, how is my above scenario wrong?


You don't need to buy every book published about taxes. . . just this one. Toss the ones you have out the window. After you read the book then we can discuss scenarios.


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## blooba (Feb 9, 2010)

deaconjim said:


> Without doing some research on the plan, it's hard to understand how and why it works. On the surface it doesn't sound like a good idea, and I was a sceptic at first. That changed completely once I fully understood the plan.
> 
> Go here and read about it, I think it will help.


Yea, that's what I'm basing it on, they are saying 20%-30% BUT I cannot find any actually numbers to prove it will provide the revenue it is promised to. So I am having to research further on how much revenue it would provide or cut. If we cut 90% of the government's budget it would be a viable option according to my numbers above although if we did that we could just emplace tariffs and be done with it.


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## Bountiful Ranch (Jan 11, 2010)

I lived 7 years oversees on the economy and so I know what a VAT tax is. It hurts the lower income more than the upper income. Everything has a hidden tax on it. You think the producer is raising his prices but it is the government getting it. You think about it, Obama says he not raising taxes on the middle well everything and I mean everything you buy has a hidden tax on it, who does it hurt the most. The consumer who buys groceries. Take milk, the diary sell it to the trucker (tax), the company that makes the cheese (tax), to the grocery store (tax) then you another (tax) so if the VAT TAX WAS 4 percent you can times that by several hands it went into and that is what your block of cheese is going up in price.


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## Jenn (Nov 9, 2004)

blooba said:


> The problem with VAT or sales tax is that you are benefiting the rich and taxing the poor a bigger percentage.
> 
> When someone makes $25,000/yr they will be spending it all so all of that money will be taxed.
> 
> ...


(regressive means, bigger burden on the lower poorer end of the scale)


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## blooba (Feb 9, 2010)

deaconjim said:


> Without doing some research on the plan, it's hard to understand how and why it works. On the surface it doesn't sound like a good idea, and I was a sceptic at first. That changed completely once I fully understood the plan.
> 
> Go here and read about it, I think it will help.


ok, well I found some correct numbers from .gov(still can't trust them...lol)
Personal Consumption= $10,089.1 billion
Government spending= $3,833.9 billion (only federal)
You do the math! Don't forget that we will have to pay for all the "prebates" somehow at a total of $2,112,067,084.

Will 23% sales tax really work?


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## Dr. Mom (Jan 13, 2008)

blooba said:


> If you have done your research and think social engineering,loopholes and variable taxes is fair with the prebate system on your "fair" tax then lobby for it. I'm just trying to show you where it lacks and am proposing a better solution (in my mind)
> 
> The problem was that the conservatives relaxed and the liberals stood up. This election hopefully will change things as long as you(and all other conservatives) don't stop standing up for your ideas.


Every 4 years we keep saying that. Every 4 years things keep getting worse. It's been going on for decades. It ain't gonna get any better unless we get a govt who will get it's hands out of the people's pockets and pay attention to what the people are saying. It doesn't matter which party it is. If enough people, bipartisan, will study the fair tax and urge their elected official to study it, then maybe we can get something done.


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## where I want to (Oct 28, 2008)

The basic truth is that everyone wants the tax that they think hits them least (other guy pays for it,) Congress can not help tinkering with any tax plan as they love the feeling of power and are in the hands of the lobbyists, and the American pulbic votes based on 20 second TV fairy tales.
Lobbyists for Education (with a big E,) lawyers, Corporations of various kinds, Unions, Social Workers of every variety, etc, etc, etc all come before the public except for the 5 months or so before an election.
Conservatives and liberals alike want their own version of social engineering.
I personally would like a personal indexed tax of 2 or 3 levels, with all income being subject to it, even that below poverty lines- no exemptions, deductions, credits, deferrals, or different tax rates based on different kinds of income- all fringe benefits to be taxed at the actual cost.
For business, both corporate and self employed, only deductions being actual expenses paid in the calendar year or prorated over life of equipment, no depreciation, deferral of foreign income, moving of income to sub-corporations. In fact, no deductions for anything that other that hardware purchased out of corporation and salary/benefits subject to personal taxation elsewhere. No corporate purchase of anything for the personal use of any employee or owner coming off as an expense. 
No charitable, education, employee business expenses, subsidzed oil drilling investment, etc deductions. 
Grow businesses on after tax dollars- no intangible losses, etc.

And if you want Tinkerbell to live, clap your hands...........................


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## ET1 SS (Oct 22, 2005)

blooba said:


> Well for one, A lower income person like me doesn't have money to move around to qualify for all the loopholes.
> you are allowing the rich to move more money into those loopholes(deductions and credits) So in essence they are paying the same or less.


You say that you are low income, which means that you are among the least taxed people in our nation. You pay the least taxes, celebrate!

I am also low income, being on pension I no longer earn enough to pay income taxes. 





> ... Secondly, what gives the government the right to practice social engineering on the citizens?


By right of being our government.





> ... I don't need a college education since I make decent money doing what I do so I am being punished.


If you choose to not attend classes or conferences that is your choice.





> ... I prefer not to have kids for multiple reasons but I reasonable cannot afford them (without government payouts and credits)


I seriously doubt that.





> ... BUT I am being forced to pay for your kids. Children are a tax burden and really should be charged for. I know that would be wrong in many peoples eyes but I definitely shouldn't be paying you to have kids for me to pay for them.
> 
> Why should I be charged extra for "living outside the box"?


You do not pay for my children.


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## blooba (Feb 9, 2010)

ET1 SS said:


> You say that you are low income, which means that you are among the least taxed people in our nation. You pay the least taxes, celebrate!
> 
> I am also low income, being on pension I no longer earn enough to pay income taxes.
> By right of being our government.
> ...


Guess who else has tried social engineering?
Hint: Hitler.

Who do you think pays for your kids school,free lunch, school nurse, ect ect?
Hint:It's not the parents with all the deductions and credits for children

Yea, not attending education is my choice, although should I be paying more taxes due to it?
Hint:Who is also paying for pell grants and other Federal scholarships and grants?


Oh yea, I pay $21,000 in taxes out of an income of $38,000/yr I AM CELEBRATING!!!:flame::flame::flame::flame::flame:


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## ET1 SS (Oct 22, 2005)

blooba said:


> ... Who do you think pays for your kids school,free lunch, school nurse, ect ect?
> Hint:It's not the parents with all the deductions and credits for children


You can not be this stupid.

Schools are paid from property taxes.

Income taxes have no connection with public-funded schools.





> ...
> Oh yea, I pay $21,000 in taxes out of an income of $38,000/yr I AM CELEBRATING!!!:flame::flame::flame::flame::flame:


I seriously doubt that you pay 21k out of a gross 38K.

Besides this started from you saying that you were low income.


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## blooba (Feb 9, 2010)

ET1 SS said:


> You can not be this stupid.
> 
> Schools are paid from property taxes.
> 
> ...


That $21k is total taxes not just income taxes. I was quite surprised also.

So since when did the Federal government start charging property taxes? $140.9 Billion dollars are spent on the Fed. Dept. of Ed. of which $80 billion is sent to the states in "grants"

You'd be better off doing some research before you start assuming things are the way they are supposed to be.


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## ET1 SS (Oct 22, 2005)

blooba said:


> That $21k is total taxes not just income taxes. I was quite surprised also.
> 
> So since when did the Federal government start charging property taxes? $140.9 Billion dollars are spent on the Fed. Dept. of Ed. of which $80 billion is sent to the states in "grants"
> 
> You'd be better off doing some research before you start assuming things are the way they are supposed to be.


Some may accept Federal grants some do not.

So you insist that while you earn $38k you only spend 17k to support your family? While 21k goes to taxes?

Here I earn $18k and less then 2k goes to taxes.


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## watcher (Sep 4, 2006)

deaconjim said:


> How does it prevent the government from using the tax system to control people?


Ok maybe too strong of a term. But because w/o deductions or exemptions the government can not use the tax system to "encourage" or "discourage" people from an action. 

For example the government currently wants to "encourage" people to buy houses therefore it offers a "tax break" of $8K for people to do so. If it were to decided to discourage people from owning homes it would remove the mortgage interest "tax exemption". The use of the tax code this way, IMO, should be illegal.


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## deaconjim (Oct 31, 2005)

watcher said:


> Ok maybe too strong of a term. But because w/o deductions or exemptions the government can not use the tax system to "encourage" or "discourage" people from an action.
> 
> For example the government currently wants to "encourage" people to buy houses therefore it offers a "tax break" of $8K for people to do so. If it were to decided to discourage people from owning homes it would remove the mortgage interest "tax exemption". The use of the tax code this way, IMO, should be illegal.


What is it about the flat tax that prevents Congress from using the tax code in that way?


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## watcher (Sep 4, 2006)

deaconjim said:


> The prebate is based on the number of people in the family. Larger family = larger prebate. There is no social engineering involved. The prebate is simply designed to allow you to avoid paying taxes on the money needed to pay for the basic necessities of life.


And that number is set by who? Ah. . .the government. Which means the politicians can still buy the votes of the slugs with tax dollars taken form those who produce. It can set the number so high that, just like today, a large percentage of the American people will be paying 0% in taxes. I can see the political ads now "Vote for Joe Smuck and he will raise the prebate to $10,000 per person." or (dark music in the back ground) "Bill Snuffy thinks YOU don't need an increase in YOUR prebate. I guess he doesn't CARE about YOUR kids!!" Now who do you think the slugs out there would vote for?





deaconjim said:


> If you haven't already done so, get a copy of the Fair Tax book by Neal Boortz and read it. He also has a second book which answers a lot of the questions and issues raised by critics of the plan. Boortz explains all of this much better than I can.


You have explained it just fine. Its just it is just as flawed and unfair as the current system we have. Some people will be paying more than others and the politicians will still be able to use the system to buy votes and stay in power where they can use the system to buy even more votes to stay in power even longer. 

The only real difference in the "fair" tax and the current system is the current system has been in place so long it has had time to evolve into what we have today. Give the fair tax a few years and we will be in the same boat. Some people will pay a large chunk of their money to the government, some will pay next to nothing and some will get more out of the system then they put in.


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## watcher (Sep 4, 2006)

ET1 SS said:


> You can not be this stupid.
> 
> Schools are paid from property taxes.
> 
> Income taxes have no connection with public-funded schools.



You said it so I have no problem repeating it. You can't be THAT stupid. Billions upon billions of federal dollars go to public funded schools. Ever wonder why a school will give away Ipods to students with perfect attendances? Because their federal money is based on the average daily kid count. 

Ever wonder where all the money for the "National School Lunch Program" comes from? To quote from the website, http://www.fns.usda.gov/cnd/Lunch/ (please note the dot gov [.gov]) it :_"is a federally assisted meal program operating in public and nonprofit private schools and residential child care institutions. It provides nutritionally balanced, low-cost or free lunches to children each school day. The program was established under the National School Lunch Act, signed by President Harry Truman in 1946."_


Where do you think all the billions of dollars the federal Dept of ED goes to?


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## deaconjim (Oct 31, 2005)

watcher said:


> And that number is set by who? Ah. . .the government. Which means the politicians can still buy the votes of the slugs with tax dollars taken form those who produce. It can set the number so high that, just like today, a large percentage of the American people will be paying 0% in taxes. I can see the political ads now "Vote for Joe Smuck and he will raise the prebate to $10,000 per person." or (dark music in the back ground) "Bill Snuffy thinks YOU don't need an increase in YOUR prebate. I guess he doesn't CARE about YOUR kids!!" Now who do you think the slugs out there would vote for?
> 
> 
> 
> ...


There is nothing that Congress can't screw up. Regardless of what system we have, it will be necessary for us to be smart enough to stop that sort of thing from happening. The Fair Tax requires the repeal of the 16th amendment, and will result in the dismantling of the IRS. It takes away the ability of politicians to use class envy to divide us the way they do now. 

The prebate is based on the poverty level for a particular family size. Yes, the government sets this figure, and we can see in this administration their willingness to change that number to suit their political needs. Nothing will ever remove the necessity for us to remain vigilant against tryranny.


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## blooba (Feb 9, 2010)

ET1 SS said:


> Some may accept Federal grants some do not.
> 
> So you insist that while you earn $38k you only spend 17k to support your family? While 21k goes to taxes?
> 
> Here I earn $18k and less then 2k goes to taxes.


Hence herein lies the social engineering and unfair taxes......look.... I'm psychic :indif:.... you have kids....... Well I don't, it's fair to tax me $19,000 more right?

FYI: I believe you pay ALOT more in taxes than that, ever hear of sales tax? gasoline tax? excise tax? there are a million more.



watcher said:


> You said it so I have no problem repeating it. You can't be THAT stupid. Billions upon billions of federal dollars go to public funded schools. Ever wonder why a school will give away Ipods to students with perfect attendances? Because their federal money is based on the average daily kid count.
> 
> Ever wonder where all the money for the "National School Lunch Program" comes from? To quote from the website, http://www.fns.usda.gov/cnd/Lunch/ (please note the dot gov [.gov]) it :_"is a federally assisted meal program operating in public and nonprofit private schools and residential child care institutions. It provides nutritionally balanced, low-cost or free lunches to children each school day. The program was established under the National School Lunch Act, signed by President Harry Truman in 1946."_
> 
> ...


Yea, I don't believe my above stated dollars of $140.9 billion even counted the lunch program since it is ran by the USDA.


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## watcher (Sep 4, 2006)

ET1 SS said:


> Some may accept Federal grants some do not.
> 
> So you insist that while you earn $38k you only spend 17k to support your family? While 21k goes to taxes?
> 
> Here I earn $18k and less then 2k goes to taxes.


I'm sorry but I'm having trouble believing you pay 1.2% of your income in tax. Does that 2K number include your federal income tax, your SS tax, your medicare tax, your state and local income tax (if you have them), your state sales tax, your property tax, the all the "fees" on things like your phone and electric bill the government requires you to pay?

The main reason I'm sure you are wrong is if you are an employee you are REQUIRED to pay around 7.5% (if you are self employed you pay 15%) of your earnings directly to the government via FICA. The would mean you are paying $1,350 for that alone. That leaves you with $650 to pay all the rest of the taxes I mentioned. Therefore there is NO way you are paying less than $2K a year on taxes.


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## watcher (Sep 4, 2006)

deaconjim said:


> There is nothing that Congress can't screw up. Regardless of what system we have, it will be necessary for us to be smart enough to stop that sort of thing from happening. The Fair Tax requires the repeal of the 16th amendment, and will result in the dismantling of the IRS. It takes away the ability of politicians to use class envy to divide us the way they do now.
> 
> The prebate is based on the poverty level for a particular family size. Yes, the government sets this figure, and we can see in this administration their willingness to change that number to suit their political needs. Nothing will ever remove the necessity for us to remain vigilant against tryranny.


Tell me how, without changing the tax law itself, they can 'adjust' to their benefit, a flat tax with no deductions nor exemptions. If everyone is required to pay the same rate and no one can be singled out to get a tax break how can it be rigged?

Do you admit that the "fair" tax is not fair because it still requires some people to pay more in tax than another? Would it be fair for your gas station to charge you more for a gallon of gas than the guy before or after you?


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## watcher (Sep 4, 2006)

deaconjim said:


> What is it about the flat tax that prevents Congress from using the tax code in that way?


Because it is a flat rate with no exemptions nor deductions. It would have NO provisions in it which could be adjusted to favor one group over another. If they increase the tax rate they increase it on everyone evenly and across the board. You take the money you make, multiply it by a set factor then send that amount to the federal government.


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## Dr. Mom (Jan 13, 2008)

watcher said:


> Tell me how, without changing the tax law itself, they can 'adjust' to their benefit, a flat tax with no deductions nor exemptions. If everyone is required to pay the same rate and no one can be singled out to get a tax break how can it be rigged?
> 
> Do you admit that the "fair" tax is not fair because it still requires some people to pay more in tax than another? Would it be fair for your gas station to charge you more for a gallon of gas than the guy before or after you?


Why do you insist on arguing about a subject that you are not willing to read about and learn for yourself? If you don't want to purchase the Fair Tax Book then check it out at the library. When you've read it, then we can have a discussion about it without having to fend off your criticism due to lack of knowledge.


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## deaconjim (Oct 31, 2005)

watcher said:


> Because it is a flat rate with no exemptions nor deductions. It would have NO provisions in it which could be adjusted to favor one group over another. If they increase the tax rate they increase it on everyone evenly and across the board. You take the money you make, multiply it by a set factor then send that amount to the federal government.


What prevents them from adding exemptions or deductions?


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## deaconjim (Oct 31, 2005)

watcher said:


> Tell me how, without changing the tax law itself, they can 'adjust' to their benefit, a flat tax with no deductions nor exemptions. If everyone is required to pay the same rate and no one can be singled out to get a tax break how can it be rigged?


Simple, they change the law. That's what they do.



watcher said:


> Do you admit that the "fair" tax is not fair because it still requires some people to pay more in tax than another? Would it be fair for your gas station to charge you more for a gallon of gas than the guy before or after you?


As long as we are all paying the same percentage of the price, I believe that is as fair as we will be able to make it. It's not perfect, but it's better than taxing income, savings, and investment.


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## poppy (Feb 21, 2008)

watcher said:


> Because it is a flat rate with no exemptions nor deductions. It would have NO provisions in it which could be adjusted to favor one group over another. If they increase the tax rate they increase it on everyone evenly and across the board. You take the money you make, multiply it by a set factor then send that amount to the federal government.


Incorrect. Lobbyists would descend on DC like the plague wanting special deals for their particular group. That could happen with any tax plan though. Enactment of the Fair Tax would not mean people should not keep an eye on Congress. It would, however, end the yearly filing of income taxes and the accompanying paperwork. It would let a worker keep his entire paycheck ( minus state taxes ) to spend as he sees fit. It would end all business taxes and attract businesses to this country in great numbers. It would not tax money you save or invest. The tax would apply to all products and services with no exemptions. Everyone, rich and poor, would get the prebate to cover the basic necessities.


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## blooba (Feb 9, 2010)

poppy said:


> Incorrect. Lobbyists would descend on DC like the plague wanting special deals for their particular group. That could happen with any tax plan though. Enactment of the Fair Tax would not mean people should not keep an eye on Congress. It would, however, end the yearly filing of income taxes and the accompanying paperwork. It would let a worker keep his entire paycheck ( minus state taxes ) to spend as he sees fit. It would end all business taxes and attract businesses to this country in great numbers. It would not tax money you save or invest. The tax would apply to all products and services with no exemptions. Everyone, rich and poor, would get the prebate to cover the basic necessities.


How would it end yearly income tax filings? You have to file for your prebate monthly it looks like.

It would also double the price of everything.

With a flat income tax it is the same no matter what and the only way it would change is if it changes for everyone and the .gov couldn't do that unless they are running at a surplus. So no use for lobbyists.


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## blooba (Feb 9, 2010)

deaconjim said:


> As long as we are all paying the same percentage of the price, I believe that is as fair as we will be able to make it. It's not perfect, but it's better than taxing income, savings, and investment.


IF(thats a big IF) the .gov could live off of a 7% or so sales tax and we get rid of the prebate I could support your idea a little more although even at the 30% proposed it's not really feasible. 

Let's look at buying a car under your "fair" tax.
Car Price $25,000
"fair" tax @ 30% $7,500
State Sales Tax @7% $1,750

Total Tax paid. $9,250

Total: $34,250

Payments @ 60 mth @7% $678
without "fair" tax same rate @72 mths $456

And thats on good credit. Now you may wonder why I did the "fair" tax at 60 months and without it at 72 months but it doesn't matter how good your credit is they will never finance a vehicle for over 125% of its value for 72 months actually most people won't even qualify for 125% at all. And yes most people finance the entire amount with $0 down and finance the tax. Why should the bank be stuck paying the tax when they repossess the car? @$1k or $2k in tax that much is usually paid off before repo time but it would take 1.5 yrs to get the tax paid off with the "fair" tax

You think banks are ripping you off now? Go ahead and force this down their throat and watch what they do. Interest hikes will skyrocket, you think the 30% they already charge for some people is crazy? The people who actually pay their loans will be forced to pay the taxes of the ones that don't.


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## deaconjim (Oct 31, 2005)

blooba said:


> IF(thats a big IF) the .gov could live off of a 7% or so sales tax and we get rid of the prebate I could support your idea a little more although even at the 30% proposed it's not really feasible.
> 
> Let's look at buying a car under your "fair" tax.
> Car Price $25,000
> ...


We can't carry on a coherant conversation about the Fair Tax unless you understand how it works. From your figures, it is obvious you haven't read the details of the plan. Please read and understand the plan, and then we can debate the pros and cons.


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## blooba (Feb 9, 2010)

deaconjim said:


> We can't carry on a coherant conversation about the Fair Tax unless you understand how it works. From your figures, it is obvious you haven't read the details of the plan. Please read and understand the plan, and then we can debate the pros and cons.


I'm sorry, I am not reading the 131 page bill. It is flawed even you have said that so why advocate it? 

You know I just heard some other group of people say the same the thing on something that just got passed as law.


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## deaconjim (Oct 31, 2005)

blooba said:


> I'm sorry, I am not reading the 131 page bill. It is flawed even you have said that so why advocate it?
> 
> You know I just heard some other group of people say the same the thing on something that just got passed as law.


You don't have to read the bill, just go to www.fairtax.org and read the material on their website. They do a great job of explaining how it works, and they answer many of the questions and concerns that people have with the bill.

This isn't a poorly planned, half-baked idea. It has been thoroughly researched and it will work. Most of the people who object to the idea have never read the details, and their objections simply aren't valid.


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## blooba (Feb 9, 2010)

deaconjim said:


> Most of the people who object to the idea have never read the details, and their objections simply aren't valid.


Well than educate me.
Social Engineering is not written in here?

Variable tax rates are not in this tax plan? How can it be called a "fair" tax If some people pay little or no tax and some pay 30%+

I still haven't seen how we will make up for the lost tax revenue of about 60% of all income without emplacing a @100% sales tax. They are assuming someone who makes millions will be spending it all. I know for a fact that won't happen.

What are your objections with a flat income tax?

It taxes savings and investments? Your tax burden would be the same or less because even low income people would be paying their fair share. 

The "fair" tax REALLY gives the advantage to the rich although a flat rate only sort of advantage the rich. 

Sure the flat tax will raise the taxes for low income although your "fair" tax still gives them tax immunity. Why shouldn't they pay their fair share? They use the system the same if not more.


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## deaconjim (Oct 31, 2005)

blooba said:


> Well than educate me.
> Social Engineering is not written in here?
> 
> Variable tax rates are not in this tax plan? How can it be called a "fair" tax If some people pay little or no tax and some pay 30%+
> ...


That's not my job. I've provided a link that gives the details of the plan in a very clear, easy to understand format. Go there and read.



blooba said:


> What are your objections with a flat income tax?
> 
> It taxes savings and investments? Your tax burden would be the same or less because even low income people would be paying their fair share.
> 
> ...


My objectives to the flat income tax are:

1. It is a tax on earning, saving and investment.
2. It leaves the IRS intact
3. I still have to report my income to the federal government
4. It leaves the 16th amendment in force
5. It will not remain flat

The flat tax isn't any more "flat" than the Fair Tax. People are still taxed on a percentage of their income, so the rich pay more than the poor.


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## blooba (Feb 9, 2010)

deaconjim said:


> The flat tax isn't any more "flat" than the Fair Tax. People are still taxed on a percentage of their income, so the rich pay more than the poor.


Yea the rich will pay more than the poor BUT it is all the same percentage. With yours you have some paying 0%, some 10%, some 20%, some 30% or whatever rate you have in place.

With the flat tax you even contribute if you only make $100, you still have to pay Uncle Sam $7. 

With your "fair" tax you are giving the government an interest free loan while you wait for your prebate, with the flat tax there is no guessing on how much you owe. No $100 fee for your tax preparer or anything, any moron can figure out their taxes and no rebates to worry about. Guess we will have to find new jobs for tax guys  sorry H&R Block....

You know one good thing I have learned in my years of sales trainings?
A little acronym 

K.I.S.S.

Keep It Simple, Stupid.


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## poppy (Feb 21, 2008)

blooba said:


> Well than educate me.
> Social Engineering is not written in here?
> 
> Variable tax rates are not in this tax plan? How can it be called a "fair" tax If some people pay little or no tax and some pay 30%+
> ...


It is fair because you are not forced to pay any tax. It depends on what you choose to buy. Of course the rich will buy more than the poor simply because they have more disposable income. Not many poor people buy big boats or new vehicles. The Fair Tax makes up the revenue by also being applied to services, which are not taxed now. If you hire a plumber, the Fair Tax would apply to his entire bill. If you do the plumbing yourself, the Fair tax would only apply to plumbing supplies you bought at the retail level. Please read up on it. It is a well thought out plan.


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## deaconjim (Oct 31, 2005)

blooba said:


> Yea the rich will pay more than the poor BUT it is all the same percentage. With yours you have some paying 0%, some 10%, some 20%, some 30% or whatever rate you have in place.
> 
> With the flat tax you even contribute if you only make $100, you still have to pay Uncle Sam $7.
> 
> ...


In your years of sales training, did you learn to do your research before talking about something? Again, you obviously haven't read the plan.

(BTW, it's called a *pre*bate for a reason.)


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## poppy (Feb 21, 2008)

blooba said:


> Yea the rich will pay more than the poor BUT it is all the same percentage. With yours you have some paying 0%, some 10%, some 20%, some 30% or whatever rate you have in place.
> 
> With the flat tax you even contribute if you only make $100, you still have to pay Uncle Sam $7.
> 
> ...


There is no guessing what you owe under the Fair Tax. Your tax will be included in everything you buy, goods and services. If the price on the shelf says $100.00 and you buy it, your tax is included and your tax is paid. It is up to the retailer to remit the 23% tax to the government because you are out of the loop. BTW, under the Fair Tax, everyone pays the same rate ( but only on what they purchase ). You have no taxes to file.


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## blooba (Feb 9, 2010)

poppy said:


> It is fair because you are not forced to pay any tax. It depends on what you choose to buy. Of course the rich will buy more than the poor simply because they have more disposable income. Not many poor people buy big boats or new vehicles. The Fair Tax makes up the revenue by also being applied to services, which are not taxed now. If you hire a plumber, the Fair Tax would apply to his entire bill. If you do the plumbing yourself, the Fair tax would only apply to plumbing supplies you bought at the retail level. Please read up on it. It is a well thought out plan.


Personal Consumption= $10,089.1 billion *<--------includes services also*
Government spending= $3,833.9 billion (only federal)
You do the math! Don't forget that we will have to pay for all the "prebates" somehow at a total of $2,112,067,084.

Will 23% sales tax really work?


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## blooba (Feb 9, 2010)

deaconjim said:


> My objectives to the flat income tax are:
> 
> 1. It is a tax on earning, saving and investment.
> 2. It leaves the IRS intact
> ...


oh, ok i see how the prebate works.

Who will control and monitor your prebate though? With no enforcement agency I can say I have 20 kids and get a whopper of a prebate check.

Why won't it remain flat? If .gov spending goes up it goes up across the board and it goes down if .gov spending is decreased, its all based on incomes and revenue. Your "fair" tax has more room to play with the numbers to advantage a certain voter base. 

We all know that people with more children are more liberal than people without so lets raise the prebate for them and lower it for the people without kids. See what I mean? The flat tax is 7% across the board, you raise it on one person you raise it on all.


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## blooba (Feb 9, 2010)

poppy said:


> BTW, under the Fair Tax, everyone pays the same rate ( but only on what they purchase ). You have no taxes to file.


You will have to file every year on how many people you have in your household. Household sizes change all the time in some households. What happens if you have a dependent at the beginning of the year and they move out. Think the head of household will write them a check for their share of the prebate?


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## deaconjim (Oct 31, 2005)

blooba said:


> oh, ok i see how the prebate works.
> 
> Who will control and monitor your prebate though? With no enforcement agency I can say I have 20 kids and get a whopper of a prebate check.
> 
> ...


Our current tax system was flat when it was first proposed. That didn't last long.

At one time, I was adamantly opposed to any form of a national sales tax. I was fully on board with the flat tax, until I actually read up on the Fair Tax. Once I had done that, I started throwing rocks at the flat tax. The Fair Tax plan is by far a better plan. Read up on it, it's worth taking the time to do so.


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## deaconjim (Oct 31, 2005)

Here is a comparison between the current tax system, the Fair Tax, and the flat tax.

Here is an interesting paper on the cost of compliance with income tax laws.


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## blooba (Feb 9, 2010)

deaconjim said:


> Here is a comparison between the current tax system, the Fair Tax, and the flat tax.
> 
> Here is an interesting paper on the cost of compliance with income tax laws.


ok, well I don't support the VAT like was written into that bill that they are referring to or any "family deductions" like alot of the proposals have.Also if we got rid of the illegals and properly closed our border taxing illegal citizens wouldn't be an issue.

If the flat tax is so bad for companies why is everyone going to it? 
How come no other country has used a sales tax only system, they all have an income tax on top of it?

Russia is actually running at a surplus instead of a deficit like us.

Estonia was the first to adopt a flat tax, implementing a 26 percent rate in 1994, just a few years after the collapse of the Soviet Union. The other two Baltic republics of the former Soviet Union enacted flat taxes in the mid-1990s, with Latvia choosing a 25 percent rate and Lithuania picking 33 percent. Along with other free-market reforms, the flat tax significantly improved economic growth, and the &#8220;Baltic Tigers&#8221; became role models for the region. Learning from its neighbors, Russia stunned the world by adopting a 13 percent flat tax, which went into effect in 2001.

The Russian flat tax quickly yielded positive results: The economy prospered, and revenues poured into government coffers since tax evasion and avoidance became much less profitable. The flat tax then spread to Serbia, which in 2003 chose a 14 percent rate. Slovakia hopped on the bandwagon the following year with a 19 percent flat tax, as did Ukraine, which chose a 13 percent tax rate. Early 2005, Romania joined the flat tax revolution with a 16 percent tax rate, and Georgia adopted a 12 per cent flat tax rate, which has the honor, at least temporarily, of being the lowest rate in the world.

The flat tax revolution has been so successful that Estonia is lowering its rate to keep pace with other nations. The Estonian flat tax is now down to 20 percent, and Lithuania also lowered its 33 percent flat tax to a more reasonable 24 percent. Poland&#8217;s government implemented an 18 percent flat tax, and lawmakers in Croatia, Bulgaria, and Hungary are also considering tax reform. Last but not least, the opposition parties in the Czech Republic have promised to implement 15 percent flat tax regimes.


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## deaconjim (Oct 31, 2005)

blooba said:


> ok, well I don't support the VAT like was written into that bill that they are referring to or any "family deductions" like alot of the proposals have.Also if we got rid of the illegals and properly closed our border taxing illegal citizens wouldn't be an issue.


The Fair Tax is NOT a VAT. A VAT is applies at every stage of manufacturing, is a lot more complex in their administration, and is more easily hidden. In most countries with a VAT, it usually co-exists with an income tax. The Fair Tax only exists at the retail level, and the one tax rate won't be easily changed without everyone knowing.


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## blooba (Feb 9, 2010)

deaconjim said:


> The Fair Tax is NOT a VAT. A VAT is applies at every stage of manufacturing, is a lot more complex in their administration, and is more easily hidden. In most countries with a VAT, it usually co-exists with an income tax. The Fair Tax only exists at the retail level, and the one tax rate won't be easily changed without everyone knowing.


No, I was talking about the flat tax proposal referred to in that comparison link, it contained a VAT.

No other country has enacted a "fair" tax like proposed without having an additional income tax. There's gotta be a reason!

The "fair" tax won't easily be changed but the prebates could be. The Flat tax CANNOT be easily changed on any front.


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## deaconjim (Oct 31, 2005)

blooba said:


> No other country has enacted a "fair" tax like proposed without having an additional income tax. There's gotta be a reason!


This is cutting edge. Nothing like that American pioneer spirit.


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## blooba (Feb 9, 2010)

deaconjim said:


> This is cutting edge. Nothing like the American pioneer spirit.


I just don't see it adding up. You would need 50-100% tax to add up and that is not feasible. 

The millionaires and billionaires WILL NOT SPEND ALL THEIR MONEY.


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## deaconjim (Oct 31, 2005)

blooba said:


> I just don't see it adding up. You would need 50-100% tax to add up and that is not feasible.
> 
> The millionaires and billionaires WILL NOT SPEND ALL THEIR MONEY.


Actually, as explained here, the tax rate would be 23%. Bear in mind too that the hidden taxes that are built into the price of everything we buy now, along with the compliance costs, will go away. 

You are right about the millionaires and billionaires not spending all thier money. They will however, invest it. That is good for all of us.


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## blooba (Feb 9, 2010)

deaconjim said:


> Actually, as explained here, the tax rate would be 23%. Bear in mind too that the hidden taxes that are built into the price of everything we buy now, along with the compliance costs, will go away.
> 
> You are right about the millionaires and billionaires not spending all thier money. They will however, invest it. That is good for all of us.


ahhh....I see the problem, they are using 2005 PCE numbers and government spending. Well the PCE numbers haven't changed much but the government spending has almost doubled. 

So if we computed it for todays numbers it would have to be 50-100% 

Also, if I'm not mistaken I believe its written in the Constitution that the Federal Government is not allowed to tax the state governments which the "fair" tax is counting on.

So there goes a trillion dollars of the tax base they were counting on and they didn't calculate on the added cost of $210.68 Billion from taxing the federal government using the 2005 numbers....lol taxing themselves!!!


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## deaconjim (Oct 31, 2005)

blooba said:


> ahhh....I see the problem, they are using 2005 PCE numbers and government spending. Well the PCE numbers haven't changed much but the government spending has almost doubled.
> 
> So if we computed it for todays numbers it would have to be 50-100%
> 
> ...


I see the problem, you don't want to believe it will work so nothing I show you will convince you. No tax system ever devised by man will be able to work with today's spending, so that is a dead-end argument.

Instead of looking for ways to dismiss the plan out of hand, put forth a little effort of your own and study the plan. If, after actually studying the plan, you are still not convinced, then so be it. If you are open to the possibility you may just find that your reservations have already been addressed.


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## blooba (Feb 9, 2010)

deaconjim said:


> I see the problem, you don't want to believe it will work so nothing I show you will convince you. No tax system ever devised by man will be able to work with today's spending, so that is a dead-end argument.
> 
> Instead of looking for ways to dismiss the plan out of hand, put forth a little effort of your own and study the plan. If, after actually studying the plan, you are still not convinced, then so be it. If you are open to the possibility you may just find that your reservations have already been addressed.


Well I was wondering why my numbers and theirs and yours weren't adding up and I found the reason. Are you refuting that my above statements are wrong? 
They are calculating a government spending of $2.236 Trillion and now government spending is up to $3.8339 trillion and growing fast. You only save $8 billion by getting rid of the IRS although put more burden on the states which will need reimbursed for the additional costs.

I'll tell ya what, when we get our government spending down to about $700 billion (7% sales tax) I will reconsider this idea. Although I will probably support a tariff only tax base IF that ever happens. 

Are you saying that a 50+% sales tax is viable?


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## deaconjim (Oct 31, 2005)

blooba said:


> Well I was wondering why my numbers and theirs and yours weren't adding up and I found the reason. Are you refuting that my above statements are wrong?
> They are calculating a government spending of $2.236 Trillion and now government spending is up to $3.8339 trillion and growing fast. You only save $8 billion by getting rid of the IRS although put more burden on the states which will need reimbursed for the additional costs.
> 
> I'll tell ya what, when we get our government spending down to about $700 billion (7% sales tax) I will reconsider this idea. Although I will probably support a tariff only tax base IF that ever happens.
> ...


If you're too lazy to study the plan on your own, I'm not going to spoon feed it to you one point at a time.


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## blooba (Feb 9, 2010)

deaconjim said:


> If you're too lazy to study the plan on your own, I'm not going to spoon feed it to you one point at a time.


It would be viable at 23% at the old spending numbers. Do you think thats why there's no new numbers since then? There is no reason to study it any more if its no longer viable. That's whats nice about a flat tax. It is able to produce the revenue needed without raising taxes on anyone except the ones not paying anything now.


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## deaconjim (Oct 31, 2005)

blooba said:


> It would be viable at 23% at the old spending numbers. Do you think thats why there's no new numbers since then? There is no reason to study it any more if its no longer viable. That's whats nice about a flat tax. It is able to produce the revenue needed without raising taxes on anyone except the ones not paying anything now.


You are assuming that the level of retail sales has remained stagnant since then, and you are assuming that the switch from an income tax to the Fair Tax would have no affect on the economy. You're too smart to make such silly assumptions, so I can only conclude that you are not making a serious effort to understand the plan. Obviously, I'm wasting my time with you.

Go study and learn a little about it, and I'll be happy to discuss it with you. If not, I see no reason to bother.


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## Batt (Sep 8, 2006)

deaconjim said:


> Go study and learn a little about it, and I'll be happy to discuss it with you. If not, I see no reason to bother.


DJ: I don't see how anyone with 1,200 posts in less than 2 months could possibly have time to study anything. Nor for that matter have a life outside of a keyboard.


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## blooba (Feb 9, 2010)

deaconjim said:


> You are assuming that the level of retail sales has remained stagnant since then, and you are assuming that the switch from an income tax to the Fair Tax would have no affect on the economy. You're too smart to make such silly assumptions, so I can only conclude that you are not making a serious effort to understand the plan. Obviously, I'm wasting my time with you.
> 
> Go study and learn a little about it, and I'll be happy to discuss it with you. If not, I see no reason to bother.


The PCE for 2008 has raised to $12,940 billion thats only a 20% increase from the calculations that 23% is based off of. Government spending has increased 86% since then.

You do the math if you don't believe me. I understand the 23% is not feasible. I do understand almost 100% could work although its not feasible. Why research any further on a plan that is based off of old numbers?
http://www.census.gov/prod/2009pubs/10statab/income.pdf
http://www.fairtax.org/PDF/Tax Notes article on FT rate.pdf
http://www.usgovernmentspending.com/fed_federal_spending_chart_11_F.html


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## deaconjim (Oct 31, 2005)

blooba said:


> The PCE for 2008 has raised to $12,940 billion thats only a 20% increase from the calculations that 23% is based off of. Government spending has increased 86% since then.
> 
> You do the math if you don't believe me. I understand the 23% is not feasible. I do understand almost 100% could work although its not feasible. Why research any further on a plan that is based off of old numbers?
> http://www.census.gov/prod/2009pubs/10statab/income.pdf
> ...


The rate of spending is in no way related to the rate of revenue collection in this country. Neither the Fair Tax, the flat tax, the current income tax, nor a combination of all three could keep up with the current rate of spending. The last time so little was spread that far was when Christ divided the loaves and fishes. If you're waiting for that to settle on a plan, you're going to be waiting a very long time.


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## ET1 SS (Oct 22, 2005)

deaconjim said:


> The rate of spending is in no way related to the rate of revenue collection in this country. Neither the Fair Tax, the flat tax, the current income tax, nor a combination of all three could keep up with the current rate of spending. The last time so little was spread that far was when Christ divided the loaves and fishes. If you're waiting for that to settle on a plan, you're going to be waiting a very long time.


I agree.


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## texican (Oct 4, 2003)

Well, it's not really a Fair Tax, if there are prebates. As long as one class of society get's by without paying anything at all, it's not fair.

If we have a VAT, sponsored by one party, I feel the recipients of the freebies should also shoulder a share of the burden, and be required to pay taxes... Tax them even harder, and maybe they'll end their blind allegiance to the their political masters.

Cut out the fat first, eliminate all entitlements, and then lets talk of VAT, Flat, or Fair Tax. 

When I hear the word "Fair", I grab my salt shaker.


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## watcher (Sep 4, 2006)

Dr. Mom said:


> Why do you insist on arguing about a subject that you are not willing to read about and learn for yourself? If you don't want to purchase the Fair Tax Book then check it out at the library. When you've read it, then we can have a discussion about it without having to fend off your criticism due to lack of knowledge.


I know about the flat tax, I've heard Boortz talk aobut it endlessly, I've read about it. 

Now, answer one question straight out, yes or no. Does the fair tax, as proposed, allow/permit one individual to pay a smaller percentage in taxes than another?

If the answer is yes, which from EVERYTHING I have read it is, then how is that a "fair" tax system. A system which charges one person a higher rate for a product than it does another individual. Is that how you define fair?


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## watcher (Sep 4, 2006)

deaconjim said:


> What prevents them from adding exemptions or deductions?


Because to do so would require an entire rewrite of the tax law not an "adjustment" to the system.


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## watcher (Sep 4, 2006)

deaconjim said:


> Simple, they change the law. That's what they do.


Correct, they would have to change the entire law, not just make an adjustment to an existing part of the law.





deaconjim said:


> As long as we are all paying the same percentage of the price, I believe that is as fair as we will be able to make it.



But we are not all paying the same. Look at it this way. You and a neighbor both need a loaf of bread and a gallon of milk. You go to the store together, get your stuff and check out, you first. Your total is $5 so you hand the cashier a five then wait for your friend. His total comes up to $5, he hands the cashier a $5 then the cashier hands him back $3. You go "Wait a minute that isn't fair!" The cashier tells you it was perfectly fair, you each got a gallon of milk and a loaf of bread and each of you were charged $5.

All the fair tax does is reset the clock back to when the income tax started. After all it was only going to be something like 4% and only on the 1% of the population would be paying it.

We need to get it to where either everyone is paying the same rate or we have weighted votes so the more government you pay for the larger voice you have in its running.




deaconjim said:


> It's not perfect, but it's better than taxing income, savings, and investment.


If you want to go to a national sales tax instead of an income tax I'm ok with it as long as the law is strongly written, the tax is the same rate on everything, the tax IS on everything AND you get rid of the stupid prebate which changes it from a fair tax to an unfair tax.


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## watcher (Sep 4, 2006)

poppy said:


> Incorrect. Lobbyists would descend on DC like the plague wanting special deals for their particular group.


Which is why a flat tax can have NO deductions nor exemptions. Without those the lobbyists would be wasting their time and money. As soon as you allow the government to give a favor to one you have opened the flood gates for everyone. 




poppy said:


> That could happen with any tax plan though. Enactment of the Fair Tax would not mean people should not keep an eye on Congress. It would, however, end the yearly filing of income taxes and the accompanying paperwork. It would let a worker keep his entire paycheck ( minus state taxes ) to spend as he sees fit. It would end all business taxes and attract businesses to this country in great numbers. It would not tax money you save or invest. The tax would apply to all products and services with no exemptions. Everyone, rich and poor, would get the prebate to cover the basic necessities.


My major point is the "fair" tax is not fair because it forces one individual to pay more, as a percentage, than another for the same 'product'. The fair tax stills forces "the rich" to pay a higher percentage of the taxes. If you were required to pay more for a gallon of gas than your neighbor because you were taller than they were would that be fair?


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## watcher (Sep 4, 2006)

blooba said:


> How would it end yearly income tax filings? You have to file for your prebate monthly it looks like.
> 
> It would also double the price of everything.
> 
> With a flat income tax it is the same no matter what and the only way it would change is if it changes for everyone and the .gov couldn't do that unless they are running at a surplus. So no use for lobbyists.


One of the theories with the _fair_ tax is there are so many embedded taxes in things now if you get rid of all of them the prices of products would drop. Then you add the fair tax to all of them and you are right back at the same sales price.


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## watcher (Sep 4, 2006)

deaconjim said:


> You don't have to read the bill, just go to www.fairtax.org and read the material on their website. They do a great job of explaining how it works, and they answer many of the questions and concerns that people have with the bill.
> 
> This isn't a poorly planned, half-baked idea. It has been thoroughly researched and it will work. Most of the people who object to the idea have never read the details, and their objections simply aren't valid.


I want to ask about my objection. The fact that it requires one citizen to pay the government a larger percentage of his wealth than another.


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## watcher (Sep 4, 2006)

poppy said:


> It is fair because you are not forced to pay any tax. It depends on what you choose to buy. Of course the rich will buy more than the poor simply because they have more disposable income. Not many poor people buy big boats or new vehicles. The Fair Tax makes up the revenue by also being applied to services, which are not taxed now. If you hire a plumber, the Fair Tax would apply to his entire bill. If you do the plumbing yourself, the Fair tax would only apply to plumbing supplies you bought at the retail level. Please read up on it. It is a well thought out plan.


Brings up an interesting question. How do you prevent "the rich" from buying off shore? Say I wanted a new Rolls. If I were looking to have to pay 30% tax on it if I bought it in the states why would I not go to say Mexico to buy it and have it shipped to me?

I know TN loses a lot of taxes because people cross into other states to buy things to avoid the outrageous TN sales tax. A little harder to buy out of country but could be done.


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## Dr. Mom (Jan 13, 2008)

blooba said:


> I'm sorry, I am not reading the 131 page bill. It is flawed even you have said that so why advocate it?
> 
> You know I just heard some other group of people say the same the thing on something that just got passed as law.


You won't take the time to read the 131 page bill but you will take the time to read through 102 posts on this thread and waste your time arguing with those who have.


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## blooba (Feb 9, 2010)

watcher said:


> One of the theories with the _fair_ tax is there are so many embedded taxes in things now if you get rid of all of them the prices of products would drop. Then you add the fair tax to all of them and you are right back at the same sales price.


 The problem is right now with the double taxation the government isn't even bringing in the revenue needed. Our government is a pig and needs tons of slop which this plan cannot provide without dramatically increasing prices which would INCREASE the middle classes taxes.

With the flat tax it probably won't decrease the middle classes tax burden much although it will lower our ridiculous corporate tax along with raise taxes on those not paying taxes.

The only true way to decrease people's tax burden will be to cut spending and if enough spending is cut I would support any tax reform although in the current model of spending the "fair" tax is unreasonable because it cuts out so much of our current tax base. 



Dr. Mom said:


> You won't take the time to read the 131 page bill but you will take the time to read through 102 posts on this thread and waste your time arguing with those who have.


Why spend the time reading it when I have found out the numbers will no longer be feasible? Would you pay a 50%-100% sales tax? 
I could support a 23% sales tax in lieu of my current taxes (which are 30+%) if it pays for the government but it won't and I prefer not to make the country bankrupt.

I could probably find more flaws in it but I have no need to since I have done the math.


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## poppy (Feb 21, 2008)

watcher said:


> My major point is the "fair" tax is not fair because it forces one individual to pay more, as a percentage, than another for the same 'product'. The fair tax stills forces "the rich" to pay a higher percentage of the taxes. If you were required to pay more for a gallon of gas than your neighbor because you were taller than they were would that be fair?


Incorrect. Products would have the same price in the same store for everyone. If a gallon of gas is 4 bucks, it is 4 bucks for the poor guy as well as the rich.


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## poppy (Feb 21, 2008)

blooba said:


> Why spend the time reading it when I have found out the numbers will no longer be feasible? Would you pay a 50%-100% sales tax?
> I could support a 23% sales tax in lieu of my current taxes (which are 30+%) if it pays for the government but it won't and I prefer not to make the country bankrupt.
> 
> I could probably find more flaws in it but I have no need to since I have done the math.


Your math is based on a faulty premise. The Fair Tax as proposed is designed to replace government revenue from income taxes and Social Security taxes we have NOW. In other words, if you want current taxes to cover this massive spending, they are going to have to take a huge jump too. No tax system is adequate when government keeps expanding spending.


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## watcher (Sep 4, 2006)

poppy said:


> Incorrect. Products would have the same price in the same store for everyone. If a gallon of gas is 4 bucks, it is 4 bucks for the poor guy as well as the rich.


Just can't catch the analogy? You see the price of the gallon is 4 bucks but the poor guy is getting 2 bucks per gallon back after he buys it but the rich guy doesn't. This means while the listed price is the same the actual price is less for the poor guy.

Ok, I'll try again. Let us say the "fair" tax is in effect. To make the math simple lets say the tax rate is 25% and the prebate is $10K a year. We have three people A, B and C. A makes $25K/year, B makes $75K and C makes $1,000K. And to make things even more simple let's say no one saves any money.

Person A. Spends $25K, pays $6,250 in taxes but gets a $10K prebate. He actually pays NO taxes because the government is giving him $3,750 more than he paid which works out to a tax rate of -15%.

Person B. Spends $75K, pays 18,750 in taxes but gets a $10K prebate. He actually pays $8,750 in taxes which is a 12% tax rate.

Person C. Spends $1,000K, pays $250,000 in taxes but gets a $10K prebate. He actually pays 240,000 in taxes which is a 24% rate.

Now can you see why the fair tax isn't? You have three US citizens paying a different rate for the same 'product'.


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## ET1 SS (Oct 22, 2005)

blooba said:


> The problem is right now ... the government isn't even bringing in the revenue needed.


I agree.

But then again as a retiree my tax burden is very low. It is much higher for higher income folks. 





> ... With the flat tax it probably won't decrease the middle classes tax burden much although it will lower our ridiculous corporate tax along with raise taxes on those not paying taxes.


I have no problem with our corporations paying taxes.

A common sales technique used to convince sole-proprietors to incorporate, is in fact the ability to lessen a business' taxes. My SIL incorporated specifically for this reason, to lower her taxes, since corporations allow so many additional shelters.

As for people who do not pay income taxes, nothing is going to suddenly make them pay. I know many who live off the radar, whose taxable income is far below the minimum for paying income taxes currently. A 'flat tax' is not going to make them pay anything. 

If you are a sharecropper or truck-farm partner; your room and board are often included, say your annual gross is $3,000. You can support a wife and two children without using any welfare or food stamps at this level. Bring in a 'flat tax' and how much are they going to pay? It is not going to happen.


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## ET1 SS (Oct 22, 2005)

watcher said:


> Just can't catch the analogy? You see the price of the gallon is 4 bucks but the poor guy is getting 2 bucks per gallon back after he buys it but the rich guy doesn't. This means while the listed price is the same the actual price is less for the poor guy.
> 
> Ok, I'll try again. Let us say the "fair" tax is in effect. To make the math simple lets say the tax rate is 25% and the prebate is $10K a year. We have three people A, B and C. A makes $25K/year, B makes $75K and C makes $1,000K. And to make things even more simple let's say no one saves any money.
> 
> ...



So the wealthy subsidized the poor.

Like our system today.


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## michiganfarmer (Oct 15, 2005)

I think earning shouldnt be taxed. i thing spending should be taxed


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## Dr. Mom (Jan 13, 2008)

watcher said:


> Just can't catch the analogy? You see the price of the gallon is 4 bucks but the poor guy is getting 2 bucks per gallon back after he buys it but the rich guy doesn't. This means while the listed price is the same the actual price is less for the poor guy.
> 
> Ok, I'll try again. Let us say the "fair" tax is in effect. To make the math simple lets say the tax rate is 25% and the prebate is $10K a year. We have three people A, B and C. A makes $25K/year, B makes $75K and C makes $1,000K. And to make things even more simple let's say no one saves any money.
> 
> ...


Have you even read the fair tax bill? There is NO IRS. There is NO paying income taxes. The only time you pay the 23% tax rate is when you purchase a new item, not a used item. Period. YOU decide how much tax you want to pay, not the government. Your paycheck will be increased because no taxes will be taken out of it. You will have more spending/saving power.


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## watcher (Sep 4, 2006)

ET1 SS said:


> So the wealthy subsidized the poor.
> 
> Like our system today.


Which is why I've been pushing a flat tax with no deductions nor exemptions for years. Even though it would cost me MORE in taxes, it would be fair. But more than that it would give every person in the US a reason to keep an eye on the tax rate. As it stands now what do I care if they raise the highest rate to 90%? As long as I can still use all the legal deductions and exemptions to keep my income tax rate to 5% or less why should I rock the boat?


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## watcher (Sep 4, 2006)

Dr. Mom said:


> Have you even read the fair tax bill? There is NO IRS. There is NO paying income taxes. The only time you pay the 23% tax rate is when you purchase a new item, not a used item. Period. YOU decide how much tax you want to pay, not the government. Your paycheck will be increased because no taxes will be taken out of it. You will have more spending/saving power.


UGHHHH!!!!! DID YOU EVEN READ WHAT I WROTE!!!!!!!!!!!!!!!!!!!!!! Its based on exactly what the unfair tax says. Go back and read my post one more time and tell me where I say anything about in income tax. Tell me where what I wrote is NOT what the unfair tax system would do.

Its based on a sales tax and a prebate and all the taxes coming from people buying stuff. I have SHOWN by using numbers and just what the fair tax proposes to show that it is clearly unfair because the more money you make the more of the money you spend gets taxed. If you think I'm wrong show me where my numbers are wrong! I'm getting sick and tired of people saying I don't know what I'm talking about when I use EXACTLY what the fair tax says to show it is not a fair tax.


In one way I think it'd be great. If people go Galt for 6 to 12 months and only buy just what they need to live and nothing else the government would go broke. It would be paying out all those prebates with no money coming in.


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## ET1 SS (Oct 22, 2005)

watcher said:


> Which is why I've been pushing a flat tax with no deductions nor exemptions for years. Even though it would cost me MORE in taxes, it would be fair. But more than that it would give every person in the US a reason to keep an eye on the tax rate. As it stands now what do I care if they raise the highest rate to 90%? As long as I can still use all the legal deductions and exemptions to keep my income tax rate to 5% or less why should I rock the boat?


Watcher - I mean no disrespect nor insult here.

With any form of income taxation there will always remain forms to write-offs.

Say I that I receive a paycheck for some wage-slave job, and I also operate two or three side businesses.

Currently I file Schedule 'C's, 'E's and 'F's. Each of these forms is to document one or more businesses.

I determine each year how much each of these businesses shows in profit or loss; and it all effects the income taxation on my AGI.

Nearly every form of business has business expenses. It is the business man who decides which ones to use, or not.

Therefore there is no practical flat tax.


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## watcher (Sep 4, 2006)

ET1 SS said:


> Watcher - I mean no disrespect nor insult here.
> 
> With any form of income taxation there will always remain forms to write-offs.
> 
> ...


You would not have to. There would be no business deductions. It would require a complete change in the system. There also would be no business taxes because the only tax would be on income. The money your business took in would not be taxed until it was paid to an individual as income. People would no longer be able to pay businesses taxes as personal income tax. Well they could but it'd be stupid because it would cost them LOTS of money. You would have to set up your company to where all of the money from the business went into the business and you paid yourself a wage. Any money you received personally WOULD be income and therefore taxed. If it is a wage, a dividend or what ever. If it went into your personal account it gets taxed. If it goes into your business account it doesn't. 

IOW, if your business got paid $5,000 for a job but you paid other businesses $4,000 for goods and paid yourself $1,000 you would only pay taxes on the $1,000 because the other $4,000 was not income for you. It would be taxed when the other businesses paid their employees.


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## watcher (Sep 4, 2006)

Ok to show ya&#8217;ll I know what the fair tax is about I&#8217;ll give you a brief description of it. 

The fair tax removes all other federal taxes (income, FICA, etc.) and replace them with a national sales tax of around 25%. The theory is, and it seems to be sound, the taxes already built into everything now we are already paying 25% in taxes for stuff we just don&#8217;t see it. The other theory is it makes it fair because everyone will be paying the same rate and everyone will be paying taxes. This theory doesn&#8217;t hold. I have shown and will show below how this is, at best, an error at worse an out right lie used to sell the plan.

Now I have no real problem with replacing federal taxes with a sales tax. I have a MAJOR problem with replacing one system which allows some citizens to pay nothing or even get money from the government while other citizens pay a larger percentage with another system which does the same thing. Why waste the time, effort and money? I have shown time and time and time again how the fair tax does this. I&#8217;m going to do it one more time for all of you. Here goes;

In our little story the fair tax has been made the law of the land. There is no more income tax, no more FICA, no more whatever tax only a national sales tax. To make things easier we are going to use nice numbers and have everyone spend everything they make. The national sales tax of 25% on every dollar you spend. But to make it &#8220;FAIR&#8221; the government will give every tax payer (what government agency is going to decide who gets a check I&#8217;m not sure) money every month to cover the &#8220;basic necessities&#8221;. We are going to look at an entire year and to make the numbers easy we will set the cost of these &#8220;basic necessities&#8221; at $10,000 for a year. Now we are going to look at four people. H. L. Jones (H.L. for Hard Luck) who only makes $20,000 a year; A. J. Smith (Average Joe) who makes $50,000; L. L. Lee (Lucky Lou) who makes $250,000 and I.R. Thugmorton III (Im Rich) who makes $1,000,000

At the end of the year they all sit down and look at the numbers and here&#8217;s what they find.

Poor old HL spent $20k and of that $5K was taxes. But HL isn&#8217;t that bad off because the government paid him $10k. $10K &#8211; $5K = $5K and means old HL actually wound up with money in the bank at the end of the year. So no taxes for him!!!

AJ spend his $50K and the government took $12.5K but it gave him $10K back. That means Mr Smith actually paid $2,500 on $50,000 which means he had a tax rate of 5%.

Lucky Lou had a great year and spent $250K and $62.5K of that went to the tax man but hey he got $10K back. So he only paid $52.5K. That works out to a tax rate of $21%.

But IR Thugmorton III an even better year and had a million dollars to spend, and did. Of that $1,000,000, $250,000 of it went directly to the US Treasury but the treasury gave him that $10,000 back so his tax bill was only $240,000 or 24%.


So HL got money back so his tax rate would actually be negative, AJ paid a 5% tax, LL paid a 21% tax and IR paid 24%. Now using the theories of the fair tax I have shown it is not fair because one citizen is being forced to pay more than his share.


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## Dr. Mom (Jan 13, 2008)

Sorry Watcher, you can crunch numbers all day until you're blue in the face. The bottom line is that you can't decide how people are going to spend their money. The rich guy may want to buy a brand new car each year. That's fine. He pays his 25% tax and goes home. The poor guy may decide to drive his 2 year old car for a few more years or may decide to buy a used car. He pays no taxes on the used car. That was his choice. The idea is that people would have a choice how to spend their own money, not the government deciding how to spend it for them.


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## Wanderer0101 (Jul 18, 2007)

poppy said:


> Fair tax is best. Flat tax is next best. VAT is what we will get. The problem with the VAT is that it will be on top of income taxes where the other 2 would replace it. The VAT is an insidious tax system. It always starts out low and raises quickly because it is an unseen tax and government never gets tired of spending money. I see the VAT tax in some European countries is up to 22% now. Greece has one and they are still bankrupt, so it does not solve any country's financial problem.


Absolutely right.


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## ET1 SS (Oct 22, 2005)

watcher said:


> You would not have to. There would be no business deductions. It would require a complete change in the system. There also would be no business taxes because the only tax would be on income. The money your business took in would not be taxed until it was paid to an individual as income. People would no longer be able to pay businesses taxes as personal income tax. Well they could but it'd be stupid because it would cost them LOTS of money. You would have to set up your company to where all of the money from the business went into the business and you paid yourself a wage. Any money you received personally WOULD be income and therefore taxed. If it is a wage, a dividend or what ever. If it went into your personal account it gets taxed. If it goes into your business account it doesn't.
> 
> IOW, if your business got paid $5,000 for a job but you paid other businesses $4,000 for goods and paid yourself $1,000 you would only pay taxes on the $1,000 because the other $4,000 was not income for you. It would be taxed when the other businesses paid their employees.


I own apartment buildings; I have rental income, plus a bunch of expenses. Some of those expenses are predetermined and some I decide.

If I never take a paycheck [and in 25 years of owning apartment buildings the most I have ever taken has been $1 every third year back when the IRS required that you take a profit every third year], then I would never pay any taxes ever?

Sweet!


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## poppy (Feb 21, 2008)

watcher said:


> Just can't catch the analogy? You see the price of the gallon is 4 bucks but the poor guy is getting 2 bucks per gallon back after he buys it but the rich guy doesn't. This means while the listed price is the same the actual price is less for the poor guy.
> 
> Ok, I'll try again. Let us say the "fair" tax is in effect. To make the math simple lets say the tax rate is 25% and the prebate is $10K a year. We have three people A, B and C. A makes $25K/year, B makes $75K and C makes $1,000K. And to make things even more simple let's say no one saves any money.
> 
> ...


Under the fair tax, no one is forcing the rich person to pay a dime more in taxes than the poor guy. No one is forcing the rich guy to buy a thing. The flat tax does force the rich guy to pay more in taxes than the poor guy even though they both pay the same tax rate.


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## blooba (Feb 9, 2010)

ET1 SS said:


> I agree.
> 
> But then again as a retiree my tax burden is very low. It is much higher for higher income folks.
> I have no problem with our corporations paying taxes.
> ...


You have no problems with corporate taxes because your not very good at connect the dots.Didn't you ever do that when you were a kid? We become the 2nd highest corporate tax country in the world and then all the businesses go overseas......can you connect the dots? Your jobs are going overseas for a reason care to guess why? 

99% of the majority of people who don't pay taxes (50% of the population) do it legally. They pop out kids and have high deductions and credits or make less than the minimum requirement to pay taxes. Those pimps and drug dealers make up a very small percentage of income and most of them do pay taxes on their money when they launder it.

Also with a flat tax all benefits are valued and taxed.



ET1 SS said:


> I own apartment buildings; I have rental income, plus a bunch of expenses. Some of those expenses are predetermined and some I decide.
> 
> If I never take a paycheck [and in 25 years of owning apartment buildings the most I have ever taken has been $1 every third year back when the IRS required that you take a profit every third year], then I would never pay any taxes ever?
> 
> Sweet!


If you want to invest every dollar back into the business good for you. Yea it would not be taxed. You take any money out to pay for your groceries or mandated health insurance you WILL be taxed.


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## blooba (Feb 9, 2010)

poppy said:


> Under the fair tax, no one is forcing the rich person to pay a dime more in taxes than the poor guy. No one is forcing the rich guy to buy a thing. The flat tax does force the rich guy to pay more in taxes than the poor guy even though they both pay the same tax rate.


No one forces you to make an income either. So no one forces you to pay a flat tax.


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## watcher (Sep 4, 2006)

Dr. Mom said:


> Sorry Watcher, you can crunch numbers all day until you're blue in the face. The bottom line is that you can't decide how people are going to spend their money. The rich guy may want to buy a brand new car each year. That's fine. He pays his 25% tax and goes home. The poor guy may decide to drive his 2 year old car for a few more years or may decide to buy a used car. He pays no taxes on the used car. That was his choice. The idea is that people would have a choice how to spend their own money, not the government deciding how to spend it for them.



Sigh. . .can you show me where you see my numbers are wrong? The fair tax PUNISHES people who make more and spend more. Heck if it passes I can tell you I'd try to cut my expenses as much as possible. There's not much more I can cut because I'm already trying to cut my income and expenses as possible. 

I'm not sure how the fair tax plans to handle it but I can tell you if I were looking to buy a big ticket item, say a backhoe, I'd look into how much it would cost me to buy it in Mexico and ship it to me vs the amount of sales taxes I'd pay. If I'm looking at a $50K on a backhoe I'd be looking at $12,500 in federal sales tax plus around another $3,500 in state sales tax. I think I could ship one from Mexico to GA for less than $16,000 don't you?


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## watcher (Sep 4, 2006)

ET1 SS said:


> I own apartment buildings; I have rental income, plus a bunch of expenses. Some of those expenses are predetermined and some I decide.
> 
> If I never take a paycheck [and in 25 years of owning apartment buildings the most I have ever taken has been $1 every third year back when the IRS required that you take a profit every third year], then I would never pay any taxes ever?
> 
> Sweet!


Read it again. There is no business income tax and no deductions allowed on personal income. If you tried to count your business income on your personal taxes you'd have to pay the flat rate on every dollar which came it because there are no deductions allowed. You'd have to have separate your business and your personal income. You'd have to show that all of the money coming in to your business is going back into your business.

If you showed 0 personal income or a very low income vs a large business expenses you'd wind up having to show how where the money really went. But don't worry fines for tax fraud would be nothing but the taxes owed adjusted for inflation. Then again you might want to worry, the criminal penalties are quite harsh so if you were caught cheating you'd have 10 years of near free lodging curiosity of the US Justice dept. This is because fines are easily passed along but jail time isn't.


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## watcher (Sep 4, 2006)

poppy said:


> Under the fair tax, no one is forcing the rich person to pay a dime more in taxes than the poor guy. No one is forcing the rich guy to buy a thing. The flat tax does force the rich guy to pay more in taxes than the poor guy even though they both pay the same tax rate.


IOW, the fair tax would encourage rich people to stop spending. Sounds like a great way to help the economy. 

As I said I like it for that reason. If you can get enough people to spend only what they must to, preferably so their tax load is less than the prebate, you could bankrupt the government in a probably less than 18 months. The though of the government having zero income for a year makes me smile


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## blooba (Feb 9, 2010)

watcher said:


> The though of the government having zero income for a year makes me smile


Yea, you "fair" tax lovers need to make sure you write in that the government must run a balanced budget, that would be great to see.


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## Dr. Mom (Jan 13, 2008)

watcher said:


> Sigh. . .can you show me where you see my numbers are wrong? The fair tax PUNISHES people who make more and spend more. Heck if it passes I can tell you I'd try to cut my expenses as much as possible. There's not much more I can cut because I'm already trying to cut my income and expenses as possible.
> 
> I'm not sure how the fair tax plans to handle it but I can tell you if I were looking to buy a big ticket item, say a backhoe, I'd look into how much it would cost me to buy it in Mexico and ship it to me vs the amount of sales taxes I'd pay. If I'm looking at a $50K on a backhoe I'd be looking at $12,500 in federal sales tax plus around another $3,500 in state sales tax. I think I could ship one from Mexico to GA for less than $16,000 don't you?



Sigh back at ya . The only number you have to worry about is the 23% tax rate or whatever they decide to set it at. Don't buy a new backhoe, buy a used one. Presto, no taxes, no crunching numbers. 

You're really trying to make it into a bigger problem than what it is. Some things you will have to buy new, there's no getting around that, so you pay the 23% tax and go home. You can make up the difference by buying used or pre-owned stuff when you can. Your paycheck will be increased so you have more spending power. We can pump our own money back into the system instead of the govt printing more money to pump back into the system.

The important thing to remember is that how you spend your money is YOUR choice to make, not the government's. I think we've been brainwashed by the govt and the IRS for so many years, we don't know how to think outside of the box anymore.


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## blooba (Feb 9, 2010)

Dr. Mom said:


> Sigh back at ya . The only number you have to worry about is the 23% tax rate or whatever they decide to set it at. Don't buy a new backhoe, buy a used one. Presto, no taxes, no crunching numbers.
> 
> You're really trying to make it into a bigger problem than what it is. Some things you will have to buy new, there's no getting around that, so you pay the 23% tax and go home. You can make up the difference by buying used or pre-owned stuff when you can. Your paycheck will be increased so you have more spending power. We can pump our own money back into the system instead of the govt printing more money to pump back into the system.
> 
> The important thing to remember is that how you spend your money is YOUR choice to make, not the government's. I think we've been brainwashed by the govt and the IRS for so many years, we don't know how to think outside of the box anymore.


Oh yea, never even thought about it but with this theory of buying used tax free reduces your tax base even more. So 150% sales tax? heck lets make it 200% for reducing the debt. How much is too much?

I don't think the used market is that big but the states do collect sales tax on used purchases and those numbers are included in your fictional 23%


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## ET1 SS (Oct 22, 2005)

blooba said:


> You have no problems with corporate taxes because your not very good at connect the dots.Didn't you ever do that when you were a kid? We become the 2nd highest corporate tax country in the world and then all the businesses go overseas......can you connect the dots?


Corporations left because they have been over-regulated.





> ... Your jobs are going overseas for a reason care to guess why?


My job has never gone overseas.





> ... 99% of the majority of people who don't pay taxes (50% of the population) do it legally. They pop out kids and have high deductions and credits or make less than the minimum requirement to pay taxes.


99%?

I can see that some do this, I do not think that 99% of American non-tax-payers are doing it via children.

Some are entrepreneurs, some are investors who have good tax-plans.





> ... Those pimps and drug dealers make up a very small percentage of income and most of them do pay taxes on their money when they launder it.


What?

Where did the conversation shift to pimps and drug-dealers?


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## ET1 SS (Oct 22, 2005)

watcher said:


> ... Then again you might want to worry, the criminal penalties are quite harsh so if you were caught cheating you'd have 10 years of near free lodging curiosity of the US Justice dept. This is because fines are easily passed along but jail time isn't.


I have never committed tax fraud.


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## blooba (Feb 9, 2010)

ET1 SS said:


> Corporations left because they have been over-regulated.
> 
> I can see that some do this, I do not think that 99% of American non-tax-payers are doing it via children.
> 
> ...


Yea, I was thinking of this and covering all my bases but forgot to answer the initial statement. They currently are not paying taxes legally, you missed where I said and under minimum requirements. But if they are required to pay they will since a flat tax is the only fair tax.

If they are investors they still have to pay capital gains tax so they pay taxes on the money.


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## Dr. Mom (Jan 13, 2008)

ET1 SS said:


> What?
> 
> Where did the conversation shift to pimps and drug-dealers?


Do you kinda feel like doing this? :buds: I do. Bottoms up!


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## watcher (Sep 4, 2006)

ET1 SS said:


> I have never committed tax fraud.


I was saying if you tried to use that system on the flat tax system I'd like to see put into place you would either go bankrupt (by trying to count your business income as personal income) or commit a crime by counting your personal income as business income.


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## Dr. Mom (Jan 13, 2008)

blooba said:


> Oh yea, never even thought about it but with this theory of buying used tax free reduces your tax base even more. So 150% sales tax? heck lets make it 200% for reducing the debt. How much is too much?
> 
> I don't think the used market is that big but the states do collect sales tax on used purchases and those numbers are included in your fictional 23%


Huh? The tax base will not be reduced. 23%. Focus on 23%. Focus. 23%. 23%. Got it focused in now? Don't lose that focus. 

You don't think the used market is that big? Used cars, used backhoes, used trucks, used lawnmowers, used 4-wheelers, used tractors, used computers, used furniture, used clothes, used books, used electronics, used teleprompters. Shall I go on? The used market will probably get much, much bigger.


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## blooba (Feb 9, 2010)

Dr. Mom said:


> Huh? The tax base will not be reduced. 23%. Focus on 23%. Focus. 23%. 23%. Got it focused in now? Don't lose that focus.
> 
> You don't think the used market is that big? Used cars, used backhoes, used trucks, used lawnmowers, used 4-wheelers, used tractors, used computers, used furniture, used clothes, used books, used electronics, used teleprompters. Shall I go on? The used market will probably get much, much bigger.


ok, well I have already proven that to cover current spending the sales tax would have to be 50-100%.

The numbers used to calculate your fictional 23% use those used market items already being sold. Since in your unfair tax wonderland this is not taxed it will need to be deducted from your projected revenue. Hence a bigger sales tax to make up for the lost tax base.

I maybe underestimating the used market and like you said it will get bigger so you will be able to tax even less money. See a problem here? Am I the only one able to add 1+1?


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## ET1 SS (Oct 22, 2005)

blooba said:


> ... If they are investors they still have to pay capital gains tax so they pay taxes on the money.


Not all investors pay capital gains taxes. I don't.

So your saying that a 'Flat tax' would also incorporate a capital gains tax as a separate tax?


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## ET1 SS (Oct 22, 2005)

watcher said:


> I was saying if you tried to use that system on the flat tax system I'd like to see put into place you would either go bankrupt (by trying to count your business income as personal income) or commit a crime by counting your personal income as business income.


I understand because today there is no distinction between different income streams. Your wage-slave paychecks and sole-proprietorships all go onto one 1040 and get taxed the same.

A flat tax system would than make you file taxes multiple times?

One for each income stream?


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## blooba (Feb 9, 2010)

ET1 SS said:


> Not all investors pay capital gains taxes. I don't.
> 
> So your saying that a 'Flat tax' would also incorporate a capital gains tax as a separate tax?


Are you admitting to tax fraud?

No there is no separate capital gains tax its taxed as income in most flat tax plans.


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## deaconjim (Oct 31, 2005)

blooba said:


> ok, well I have already proven that to cover current spending the sales tax would have to be 50-100%.
> 
> The numbers used to calculate your fictional 23% use those used market items already being sold. Since in your unfair tax wonderland this is not taxed it will need to be deducted from your projected revenue. Hence a bigger sales tax to make up for the lost tax base.
> 
> I maybe underestimating the used market and like you said it will get bigger so you will be able to tax even less money. See a problem here? Am I the only one able to add 1+1?


You've proven nothing of the sort, you've only stated. People with more financial expertise than you have calculated the tax rate and have shown that 23% will work. Of course, you would know that if you had taken the time to read the information at the link I provided. 

You're also placing unrealistic expectations on the tax system. NO tax system will work if you plan on covering current spending. I've already explained that to you and it doesn't appear to have sunk in. 

We have two problems, a poor tax system and out of control spending. These two problems will require two separate resolution.


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## ET1 SS (Oct 22, 2005)

blooba said:


> Are you admitting to tax fraud?
> 
> No there is no separate capital gains tax its taxed as income in most flat tax plans.


Not sure why you insist on fraud?

How does that enter the conversation? Or is it a matter of your own ignorance?


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## blooba (Feb 9, 2010)

ET1 SS said:


> Not sure why you insist on fraud?
> 
> How does that enter the conversation? Or is it a matter of your own ignorance?


Well do you invest in companies stocks or do you invest in magic fairy dust? I know you have to file capital gains tax on stocks, not sure what the requirements are for magic fairy dust though. I hear that market is booming right now.


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## Dr. Mom (Jan 13, 2008)

blooba said:


> ok, well I have already proven that to cover current spending the sales tax would have to be 50-100%.
> 
> The numbers used to calculate your fictional 23% use those used market items already being sold. Since in your unfair tax wonderland this is not taxed it will need to be deducted from your projected revenue. Hence a bigger sales tax to make up for the lost tax base.
> 
> I maybe underestimating the used market and like you said it will get bigger so you will be able to tax even less money. See a problem here? Am I the only one able to add 1+1?


Just to make a couple of examples, do you think that Nancy Pelosi will go to Good Will to look for a pre-owned dress? Or that Harry Reid will look for a pre-owned tie at a swap shop? Or that McDonalds will buy used french fry machines? Or that Donald Trump will buy a used F150 pickup? Or that Wal-Mart will have a pre-owned clothing isle?

There will always be a market for new items. And people like you will always complain about having to pay for a hamburger that has a 23% tax slapped on it, or a pencil, or a gallon or milk, or a package of recycled toilet paper, or a comb, etc., etc. 

Think outside the box and think how it will affect your daily life. How many things to you purchase new? How many things to you purchase used? 

You do the math. I'm outta here. I'm tired of being cooped up in this tiny box.


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## ET1 SS (Oct 22, 2005)

blooba said:


> Well do you invest in companies stocks or do you invest in magic fairy dust? I know you have to file capital gains tax on stocks, not sure what the requirements are for magic fairy dust though. I hear that market is booming right now.


Sometimes when your extremely ignorant it is best to keep your mouth shut on the hopes that maybe someone will assume your intelligent. 



Our primary investment vehicle has been MFRs [Multi-Family-Residences] often called apartment buildings.

Since my career had me transferring to different locations every 3 to 5 years we bought different MFRs at different locations. By the time that I retired we had collected four of them.

There are many different forms of investments, some of them are doing very nicely right now.


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## blooba (Feb 9, 2010)

ET1 SS said:


> Sometimes when your extremely ignorant it is best to keep your mouth shut on the hopes that maybe someone will assume your intelligent.
> Our primary investment vehicle has been MFRs [Multi-Family-Residences] often called apartment buildings.
> 
> Since my career had me transferring to different locations every 3 to 5 years we bought different MFRs at different locations. By the time that I retired we had collected four of them.
> ...


Nice personal attack...lol 

but I'm assuming you have a started a business for it to limit your personal liability which would not be considered an investment it would be a business.


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## edcopp (Oct 9, 2004)

where I want to said:


> What is a Fair tax?


Theory. Some ideas in somebody's head. Nothing in writing. Sort of like a verbal contract.


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## ET1 SS (Oct 22, 2005)

blooba said:


> Nice personal attack...lol


I did not think of it as an attack, when responding to 'fairy dust' posts I assumed it was appropriate.





> ...but I'm assuming you have a started a business for it to limit your personal liability which would not be considered an investment it would be a business.


Some businesses are investments.

Not all investments require paying capital gains taxes.


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