Why Democrats should love the FairTax

[unhappycamper]

Why Democrats should love the FairTax
By Laurence Kotlikoff
February 24, 2008

SUPPOSE A presidential candidate proposed taxing wealth and using the proceeds to reduce taxes on workers and provide a rebate large enough to cover taxes paid by poor workers. Such a candidate would be hailed by the left and reviled by the right.

Thus, it's remarkable that so many Democrats, with the exception of presidential candidate Mike Gravel, oppose the FairTax and so many Republicans, particularly presidential candidate Mike Huckabee, support it. In fact, the FairTax, which replaces all federal taxes with a federal retail sales tax and provides a rebate, represents a way to tax wealth, reduce taxes on wages, and disproportionately redistribute money to the poor.

A sales tax effectively taxes wealth?

It does. When we buy goods and services in a sales tax world, part of the payment goes to sales taxes. So we end up with fewer real goods and services.

Take Mr. Megabucks, who is sitting on $65 million and wants to buy a jet like Oprah Winfrey's - a 10-passenger, $50 million Global Express XRS. Under the FairTax, the jet costs him an extra $15 million because of the 30 percent sales tax. Mr. Megabucks gets the jet, but the extra $15 million, which he had budgeted for Beluga caviar, Dom Pérignon, and other flight snacks, goes to Uncle Sam.


Rest of flat tax article at: http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2008/02/24/why_democrats_should_love_the_fairtax/

[stark6935]

1. hi

Not everyone who is rich spend it. I have a great aunt, and great uncle that make millions of dollars in Minnesota on their farms. Guess what? They still shop at Goodwill, and eat at all you can eat buffets...The problem I think is most rich people didn't get rich from spending money.

[TheDebbieDee]

2. "Most rich people didn't get rich from spending money."

Good point.

Welcome to DU Stark6935!

[Dr.Phool]

3. Only if they tax stock transactions too.

On the purchase. Not the profit.

[gerrilea]

4. Wait a minute, not so fast, the Fair Tax should be called the Fairy Tax

Don't buy into the name, everyone, a clever ploy...like the "Patriot Act"....

Since the percentage of weathly in America has gotten richer, because of all the tax breaks they got starting with Reagan and finished off with the current idiot...where are all the jobs that were going to be created when these "wealthy" americans got thier tax breaks go??? They kept their money and are ever more wealthy...

The proposed "fair tax" is a scam, the percentages are very real...who buys the usless gadgets and gizmo's and crappy American made cars....the poor...we can afford anything else...

There is an analysis of this idea somewhere, I read it...I'll go searching and get a link for ya...

A truly "fair tax" would be one where we all pay the same percentage of our wages, no tax loopholes or tax write offs for anyone...why is it that I make $30,000 and pay 30% in taxes? And the truly wealth pay only 14 to 15% of their income?

I'll be back with a link

[gerrilea]

5. Here's the link everyone, the fairy tax fraud

http://www.factcheck.org/taxes/unspinning_the_fairtax.html

Gotta have the facts first before deciding anything these days

The final analysis is this anyone making $15,000 up to $200,000 would see their taxes go up...there goes the middle class completely...gone forever


Either you are rich or poor in this country...

[sabbat hunter]

6. under the fair tax

food and medicine and rent will be taxed. This will exceed the amount of the "prebate" very easily.

That will greatly impact on the poor and middle class.

would you want your rent going up 30%? the amount you pay for food, drugs?


Not to mention the fact that it would kill the dedicated revenue streams to medicare, SS, so that those programs can be killed due to lack of funds.

The Fair tax? I think not.

[margotb822]

7. No matter how you slice it

A fair tax will weigh more heavily on the lower and middle-classes, than the upper class.

"fair' is a con and is used to reel in the sheeple, but it will do them no good.

America needs a fair tax system, that's true, but it doesn't mean easing taxes on the wealthy.

[icnorth]

8. Uncle Sam ain't going to get a nickle

if Mr. Megabuck's shell company Scam II set up in the Bahamas buys and registers the jet. Why do you think Malcolm Forbes, Ross Perot and their ilk go orgasmic thinking about the flat tax. hmmm?

[sabbat hunter]

14. steven forbes actually

his dad Malcom was a liberal, RIP Malcom.

[icnorth]

15. I stand corrected s.h...

actually I knew that, my brain just forgot to tell my fingers.:banghead:

[Doctor_J]

9. This must have been ghost-written by the Globe's winger Jacoby

Under the sales tax, a person who lives at the poverty line and has to spend everything she makes to get by is taxed on 100% of her income. A person who makes $10M and thus is able to live in obscene luxury by spending only 5% of what she makes is taxed on only 5% of her income. Hopefully the wingers who support this tripe are able to work out that simple math.

[mcscajun]

10. What's bizarre about this article is that it's not coming from the usual sources...

This is one of Democratic Presidential candidate Mike Gravel's economic advisers. Obviously, he supports the "Fair" Tax idea; this is not a casual intellectual argument or a Devil's advocate exercise.

Regardless of source, I'm not buying the argument. :thumbsdown:

[fasttense]

11. Just another scam.

There is nothing fair about the fair tax. The poor and most of the middle class have to spend almost all of their income to survive. While the idle rich put Most of their money in banks to make more.

So who is paying a higher percentage in sales tax? The guy who spends everything or the guy who puts away most of his money cause he really doesn't need it?

Besides, the uber wealthy merely go to the Bahamas or another country to buy those big ticket items, again avoiding the supposed "fair tax".

[Deny and Shred]

12. This tax would hit hardest those who live paycheck to paycheck

or close to it. They'd pay a tax on 100% of their income. Someone who makes a lot of money who is able to save would not be taxed on those savings. It is as regressive as it gets. Once again, they pay lip service to work, but reward wealth.
Fair Tax, one in a long line of names of things put forth by Republicans that do the exact opposite of of what the name implies.

[angstlessk]

13. They will simply purchase the jet from another country..they are portable!

rich people will find a way to eliminate the tax on expensive toys...REMEMBER THE LUXUARY TAX...it went away almost overnight because the yacht industry was crying foul!!!