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The Fair Tax - 23% tax rate, 100% retarded
ElJeffe
Registered User, ClubPA regular
Registered User, ClubPA regular
The fair tax - a 23% sales tax on "all" goods - is retarded for the following reasons:
- It's regressive. The rich spend a tiny fraction of their income on goods and services as compared to the poor and middle class. Most of their income goes into savings and investment, because seriously, how much can you really spend on food and clothes and Super Sweet 16 Birthday Parties and small island nations and whatever the fuck else it is that uber-richies buy? Contrast this with the poor, who live paycheck to paycheck and spend 100% of their income on subsistence. You can prebate or rebate folks until the cows come home, but this can only shift the burden up so much. There is no way to place the bulk of a sales tax burden on people who, as a percentage of their income, don't buy all that much. It's like trying to place the bulk of a shoe tax on double amputees. You can either bone the poor, or you can bone the middle class. With some clever finagling, you might even be able to bone the upper-middle class. But the rich will pretty much walk away laughing.
- It's volatile. Consumer spending habits vary wildly based on economic conditions, which means government revenue will vary wildly. This is a Very Bad Thing.
- It forces the government to discourage savings if they want to get their phat lootz. Government policies will likely be implemented to encourage spending and borrowing at the expense of saving. They certainly won't encourage saving, because this hits them in the coffers.
- It'll play holy hell with the economy, and will drive up second-hand sales. Right now, I can buy something new at a store and pay 8% sales tax, or I can buy something slightly used on Craigslist and pay no sales tax. If the sales tax were, instead, 23%, well... fuck the B&M stores. I'll just buy used. Such a sales tax would hurt businesses by discouraging the sales of new goods.
- It has a stupid name. More like RenFaire Tax, m i rite?
- Ignore that last reason.
Discuss.
- It's regressive. The rich spend a tiny fraction of their income on goods and services as compared to the poor and middle class. Most of their income goes into savings and investment, because seriously, how much can you really spend on food and clothes and Super Sweet 16 Birthday Parties and small island nations and whatever the fuck else it is that uber-richies buy? Contrast this with the poor, who live paycheck to paycheck and spend 100% of their income on subsistence. You can prebate or rebate folks until the cows come home, but this can only shift the burden up so much. There is no way to place the bulk of a sales tax burden on people who, as a percentage of their income, don't buy all that much. It's like trying to place the bulk of a shoe tax on double amputees. You can either bone the poor, or you can bone the middle class. With some clever finagling, you might even be able to bone the upper-middle class. But the rich will pretty much walk away laughing.
- It's volatile. Consumer spending habits vary wildly based on economic conditions, which means government revenue will vary wildly. This is a Very Bad Thing.
- It forces the government to discourage savings if they want to get their phat lootz. Government policies will likely be implemented to encourage spending and borrowing at the expense of saving. They certainly won't encourage saving, because this hits them in the coffers.
- It'll play holy hell with the economy, and will drive up second-hand sales. Right now, I can buy something new at a store and pay 8% sales tax, or I can buy something slightly used on Craigslist and pay no sales tax. If the sales tax were, instead, 23%, well... fuck the B&M stores. I'll just buy used. Such a sales tax would hurt businesses by discouraging the sales of new goods.
- It has a stupid name. More like RenFaire Tax, m i rite?
- Ignore that last reason.
Discuss.
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ElJeffe on
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Unless all the necessities are untaxed. Then the poor are only paying tax on luxery items. And frankly, if you have money to spend on luxery items, then your not that poor and shouldnt be crying that much.
If I'm low income and really want to buy a house, currently I have to purchase only bare necessities, and hope that the amount of income I have after income tax + necessities is enough.
Under the new tax system, you can add all the income tax to your savings towards the new house.
Thus they actually save more money when they are saving, but lose more money when they are not.
MWO: Adamski
At least the pro flat tax people can come in here and we can immolate them here rather then in the primary thread.
Though I don't think that flat tax quite covers it. Perhaps the "fuck the poor" tax would be more accurate?
Is this choir led by Nick Lachey? That seems potentially disastrous.
See this? This is why you are wrong, and considering how thoroughly and achingly wrong it is, why everyone is pissed.
First, look here. It's an actual look at all the flaws and bullshit in the FairTax proposal.
When the entire system is predicated on everyone paying "23%" (and the the actual number is north of 30%), there is no way the end price is going to decrease. This hand waving about "hidden tax rates" is the same bullshit that leads people to think supply side/trickle down economics works. It's bullshit, and everyone involved knows it, but it's a useful front for people's actual intentions. It's quite literally and without exaggeration the economic equivalent of saying Intelligent Design is not a religious idea.
The second problem is this bullshit about "prebates" to take the burden off the poor. How can anyone, possibly, say the current tax system is too complicated and in the same breathe say all we need to do is track everyone's income and projected expenditures on some murkily defined "necessities" and everything will be easy and full of sunshine and rainbows. Besides the fact it's just shifting the burden to the middle class, just imagine trying to systematically maintaining that and tell me how much simpler things will be.
Yeah. I didn't realize the AmPol thread got infected with stupid.
And all you need to know about who would benefit from the FairTax is to look at who's supporting it.
So, there are "basic goods" that wont be taxed are going to be usable by all, but every other good is going to be taxed to high holy hell to the point that middle class people can't buy it?
Wow, its almost like we're slicing off half the middle class and forcing them to live like poor people. Unless they bite the bullet, in which case they are the cash cow for our new flat tax.
What is the tax rate on their hair shirts?
Actually, I am EXTREMELY confused about why Gravel supports it.
Although his stance on it focuses primarily on the rebatesand prebates to the poor.
I'm pretty sure that this is going to be enacted as a 23% tax on non essential goods thanks to a bunch of fudged studies by conservative think tanks, we're going to have a million dollar shortfall, and as I said earlier, we'll have to "starve the beast". This means abolishing social security, medicare, medicaid, welfare, and essentially everything that isn't the military. In short, we turn into Pakistan.
I'm pretty sure that this is going to be enacted as a 23% tax on non essential goods thanks to a bunch of fudged studies by conservative think tanks, we're going to have a trillion dollar shortfall, and as I said earlier, we'll have to "starve the beast". This means abolishing social security, medicare, medicaid, welfare, and essentially everything that isn't the military. In short, we turn into Pakistan.
The Negative Income Tax would be a better solution in that respect. Not that it really matters what Gravel supports.
I've always wanted to live in Thunderdome.
Also, I'm predicting that Hodj will not be in here arguing this. Not that he was really arguing it before so much as repeating talking points.
Yeah. And they can totally NOT afford to tell you to go fuck youself and move to the Caymans. Not at all.
There seems to be some fallacy with placing 90% of your tax burden on 10% of your population, especially when that 10% also has the financial ability to pick up and move the fuck out.
But hey lets stir some more wealth envy into the pot.....it always pays to hate rich people.
That's why I want to smack the people who say "the richest 1% has over half of all tax liability and that's an outrage!" No it's not, and the reason it's not is because of the fact you left out - they also have about 80% of the total income in the US.
1. It makes sense when that 10% of the population has 90% of the wealth.
2. Your argument seems to be, "The rich are getting out of paying taxes now. Let's just not make them pay taxes."
...so essentially there are no rich people left in the US, is that what you're telling me?
...
I don't know why, but for some reason I feel as if there's something wrong with your claim.
The "Fair Tax" has always struck me as a stealthy way of "starving the beast", also known as reducing the amount of money the federal government has to spend on social welfare programs and regulatory agencies.
It seems like outside of Mike Gravel, the "Fair Tax" is only supported by conservatives and libertarian-types.
But when that 10% has about 95+% of all income in the US - where the fuck should we put that burden?
Oh, I forgot - you don't let facts stand in the way of a rant.
By the way, the US still taxes you even if you're an expat. Are they going to give up their US citizenship?
If the rich people spend 80% of their income on luxury items, and 20% on necisities.
While poor people spend 20% of thier income on luxury items and 80% on necisities.
Rich people are taxed 30% on 80% of their income, so 24% of their income goes to taxes.
Poor people are taxed 30% on 20% of their income, so 6% of their income goes to taxes.
The rich are paying 4x the rate taxes of the poor. Thats ignoring actual income level which pushes the actual dollar amount paid into the stratosphere compared to the poor.
All of this unfortunately assumes that the legislature can do this correctly with no loop holes. Which is highly unlikely.
MWO: Adamski
Which is why we are seeing a new kind of white flight to tropical, private islands. Seems like you can't turn on the news anymore without seeing another CEO fly the coop with his golden parachute.
They also have the financial ability to shrug off that financial burden as if it were a bum panhandling them for loose change.
It doesn't matter where they move. If they're US citizens, they pay income tax. I can't think of any rich Americans willing to renounce their citizenship just because of taxes. With this "fair tax", they really can take their money elsewhere and we'll see none of it because they'll be spending it where we can't tax it.
Oh, and placing all that tax burden on the rich makes sense because they own most of the nation's wealth. As has been mentioned before, there's already abundant means for the rich to get out of paying their full share anyway. Why would we make it even easier for them to pay even less?
If that happens then the poor get fucked again since they're the ones that depend on social programs.
...what?! Consumption declines as you get more wealthy while investments increase. Well, if we're talking percentage of income, that is. Bentleys cost about as much as most starter homes, afterall.
Are you suggesting we put a sales tax on stocks and bonds under this fair tax?
You don't understand Angel. Not only are those facts, which are biased towards the left, but you don't have 10 think tanks filled with people who are paid six figures to sit on their ass and come up with really creative lies to support you. You're not going to get to him this way.
I hate quoting myself, but I'd really like to see a response to this.
Ummm... source?
You forgot one more figure.
The rich person has made ten million dollars, choosing to spend 1 million of it. Therefore, 24% of 1% of their income is taxed, or .24%.
The poor person has to spend all of the ten thousand dollars they made, so 6% of their total income is taxed.
6% to .24%. I'd rather be the rich person in that case.
TLDR: Poor people spend more of their income compared to rich people, dummy!
A progressive income tax, and yes it is.
Yes. A progressive, graduated income tax.
The official response to a point that can't be refuted: ignore it.
No, merely to point out you're treating them like a limitless commodity.....when they are actually humans, and will do what humans do best : whatevers best for them.
Not being rich, why the fuck would I stand up for them? Because I know where my job comes from, and it isn't because of charity or goodwill towards men. Sharing the burden equally via how much you consume sounds a lot more fair than "lol he has phat lootz, lets steal it from him!!". Cause thats basically what you said up above.
It is? I thought income was separate from wealth. As in, you can be wealthy and have no income, and as such, have no income tax.
I am confused. (I'm sick, and my brain wiring isa bit fried because of it.)
You are either saying that I have a solid point that can't be argued against, or that my point is 100% wrong, I think.
Which is it?