Republicans Propose 23 % National Sales Tax

[lfs5]

Ads on National Sales Tax Draw GOP Ire

By Charles Babington and Brian Faler
Tuesday, October 26, 2004; Page A09

Democratic attack ads against GOP House candidates who support a 23 percent national sales tax are causing a stir in several states, with Republicans demanding that TV stations drop them.

The ads, running in seven House districts, target Republicans who support HR 25. The bill would eliminate the federal income tax, estate tax and payroll taxes and replace them with a 23 percent sales tax. The issue has been a mainstay in the Senate race in South Carolina, but the Democratic Congressional Campaign Committee's ads have expanded it to three House districts in Texas and one each in Georgia, Indiana, Kansas and North Carolina

[Gaffey Duck]

1. Even Marxists would vote Democratic to stop something like that...

There's nothing scarier to a militant socialist than regressive taxation.

[Marxdem]

70. This Marxist has an alternate plan

I actually would like to abolish the income tax and create a national sales tax. I would EXEMPT all food and required living necessities. I think this would greatly help people that need to spend the great majority of there income on needs instead of wants.


Tax the RVs, SUVs, summer homes and other unessential possessions.

[ballcap1776]

122. Isn't that what a lot of

Scandinavian countries do?

[ibegurpard]

2. What's their problem?

These people DON'T support this? If not, then they need to shut the fuck up.

[Iris]

3. The truth hurts . . . eom

[yellowcanine]

35. "I just tell the truth and the Republicans think it's hell." - HST

Old "Give em Hell" Harry Truman had it right.

[NoMoreMrNiceGuy]

4. Actually I like the flat tax idea...just not 23% n/t

[Iris]

5. The flat tax is unfair to people who make lower incomes. n/t

[mcg]

20. and would suppress purchases, hurting the economy

This would be bad for everyone.

[Gaffey Duck]

7. I don't...

Taxation must be progressive so as to the treat the lower and middle-class fairly, yet marginal so as to ensure that people aren't penalised in the end for earning more pre-tax income and therefore resentful and unmotivated.

[shoelace414]

9. a flat tax would make sense

if bread and milk were priced according to wealth and income of the person buying it.

[Iris]

26. good analogy. n/t

[AP]

54. LOL.

[mazzarro]

14. What do you like exactly about the flat tax?

eom

[barb162]

27. the only good thing about a flat tax is that it's easy to understand

but a tax like that would just kill the poor and lower middle class and benefit the wealthy. Too many people are on the edge of bankruptcy now and this kind of tax would put many more oover the edge. It is unacceptable

[AP]

55. It's easy to understand that it makes no sense.

[American Tragedy]

93. I don't understand that argument

Why does it need to be 'easy to understand'? And what is so incomprehensible about when you have more, you pay a higher percentage?

Personally, I was taught by my parents growing up that when one has an unusual proportion of the nation's wealth, as we did, we bear similarly unusual responsibility to support those who cannot profit as easily through the system, or weren't as lucky to inherit large sums of money. Graduated tax according to income is the only truly fair way to do that.

A flat tax would inevitably lower the tax burden of the wealthiest and it would dramatically raise that of the poor and middle class. A national sales taxes would bear an overwhelming burden on the retired and disabled who depend upon federal assistance, have no income, and therefore do not normally pay taxes.

[barb162]

141. first of all I am not arguing for it as I think that kind of tax would

hurt everyone but the wealthy. Ease of understanding though has a lot going for it. When you look at the federal income tax system and the thousands of pages it runs and CPAs and tax attorneys coming up with different results, the thing has gotten way too complicated. WHat I would like to see is the current system continue but with getting rid of a lot of the loopholes and several thousand pages of tax code.

In my opinion the intricacies of the current federal tax system is incomprehensible to all but tax attorneys and others who follow case law for a living. Why do so many people have to go to accountants and tax attorneys to get their federal taxes done? Many simply don't understand it and others are getting every damn last loophole they can. It's a mess. That doesn't mean I want a flat sales tax...I want a simplified progessive tax system with far less loopholes where ordinary people can look at instructions themselves and complete their own returns.

[WhereIsMyFreedom]

155. There's nothing wrong with a flat tax

as long as it is applied to the right thing. I fully support a flat tax on accumulated wealth. Talk about encouraging spending.

[sandnsea]

16. Well gee

It would need to be that much to pay for what we need. That's why we have a progressive tax system.

[fiorello]

17. The flat tax is a 'trick' -it only replaces progressive income taxes

State and local sales taxes, national payroll taxes (for social security) are all regressive - they hit poorer people harder in proportion to their income. So if the income tax is flat (rather than progressive), the overall tax system is tilted towards the rich.

That's how Reagan shifted taxes - he put in a big cut in income taxes (also madeit less progressive), then had to put in a big increase in payroll taxes (a tax on income under $60,000) to make up for it.

Sales taxes might also be progressive if they targeted luxury spending... but they don't.

[Viking12]

77. Exactly

If we account for all taxes paid - FICA, gas, state sales, property, etc.. - we already have pretty flat tax rate.

[salib]

21. Let's not confuse terms here...

"The Flat Tax" is generally a reference to an INCOME tax that simply has only one bracket, i.e., say 15% of income no matter how much you earn. A VERY REGRESSIVE idea that has been floated on an off for many years but rejected as too punitive to those who make less. Very unfair.

Now, what the Repukes are now suggesting this time is even more over the top. It is SO REGRESSIVE that it would be as bad as what we had in the 1800's, if not worse. This is so incredibly stupid, greedy and catastrophic in execution that OF COURSE they do not want it to be an election issue. ANYONE can see how it will affect their pocketbooks, and most of us (95-99%) will loose out.

[Bandit]

25. What aspect do you like

It would be a nightmare for business to have to collect and account for such taxes. It would increase our work load drastically. I can understand the consumer saying now I don't ever have to worry about income tax again. Just figure the tax amount into the cost of the purchase and be done with it. Simple but very unfair. 23% of a person's expenses who only makes $18,000. a year is considerably more important than 23% of someone making a million dollars a year. granted more money is paid but the millionaire also has a lot of money left to do whatever with than the person making $18,000 a year. It is just plain regressive. Those that have more should pay more. It is what is fair in a country of caring people.

[mooky]

56. Businesses already do this

They already collect sales tax for the states.

[Bandit]

73. Only in a few states, not mine.

A lot of states don't have sales tax and for the ones that do you should ask a business how they like accounting for sales tax. Especially if they have both state and local sales tax. It is not fun I can assure you. You take a state like Washington that has 8% state sales tax and then another 4-5% local sales tax and add that on to 23% National sales tax and pretty soon you are paying a third more for your coke or automobile.

[mooky]

150. Only a few states don't have state sales tax

[phish420]

38. Thats because you must be taxed over 23% right now...

so it benefits you...while the rest of us...even in those 'high tech' jobs like me, (in computer repair - where my wage has gone from $15/hr 4 yrs ago, to $13/hr last year to $12/hr today) jump from 17% to whatever they determine the flat tax to be (in about every scenario, over 20%). So what it does is gives more money to the rich because they drop from 33% to 23%, and takes money from the poor who go from 17% to 23%. HORRIBLE IDEA. You pay higher taxes when you rich BECAUSE YOU RETAIN MORE OF THE WEALTH. Simple as that.

[AIJ Alom]

6. Why should the DNC stop speaking the truth ?

What the heck these Repugs can't stand behind their decisions ? flip floppers !!!!!!!

[Steelangel]

10. Exactly!

screw them! if they don't like the truth, too bad for them.

[olddem43]

8. Great idea! - instead of lowering income taxes for the rich,

just eliminate them altogether. That way, the poor and middle class can pay almost all the taxes.

[Gaffey Duck]

11. Anyways, any links?

Hmm

[lfs5]

30. http://letters.washingtonpost.com/W9RH047D439D7873DF17F3F72C5FD0

Here's the link--

[Bernardo de La Paz]

83. The link is almost useless when in the Subject line. Put it in the body.

[LibeMatt]

12. On what grounds...

...are these ads supposed to be dropped?

Unfairly influencing the election to the Democrats by telling the truth?

Unfairly influencing the election by allowing the opposition a voice?

It's sad when the proponents of this tax can't even bring themselves to defend their stance, but instead resort to suppressing the voices of their opponents.

What a great example of freedom promotion to show the rest of the world to convince them of our good intentions in Iraq.

np: Ozrics 17 July 2004--32 Blue

[tridim]

13. A family of four, on a $35,000 income will just love

paying $6000 in taxes on a $25,000 car. What a great idea repukes!

[klook]

15. Are they complete idiots?

The Republicans obviously have a screw loose if they think Americans as a whole will go for a national 23 percent sales tax. Higher sales taxes always hurt the poor and middle class, so this is a great way for them to alienate millions of voters.

Even though such a proposal is unlikely to pass, it's definitely smart of the Democrats to exploit the issue.

[no name no slogan]

18. Especially considering the V.A.T. in other countries < 20%

Granted, the Euro democracies who charge a "Value Added Tax" (aka sales tax) also have progressive income taxes, but their V.A.T.s tend to be between 15-20%, NOT 23%.

This would NEVER fly in the US. Heck, even most Repubs support progressive taxation-- just not as much of it. This is truly a Steve Forbes/supply-side wacko fixation that's only championed by a few truly cracked Milton Friedman/U of Chicago-type wingnutz.

[baldguy]

19. Losing idea

A National Sales Tax at that level would kill the market for every major item purchase. Imagine a house @ $250k: Fed Tax of $57.5k, State & local tax of 8% @ $20k for a total of $327.5k!

The 'pukes would vote for it - AND STILL THEY WOULD COMPLAIN!

[klook]

23. They want us all joining them with pitchforks and burning torches

ready to destroy the Federal government. They think that if they impose a draconian sales tax on everybody, the rest of us will see the light and join them in their anti-tax crusade.

Of course, what would really happen is that we'd throw the dimwits out of office and repeal their dumbass plan.

[CBHagman]

22. I'm glad this is getting attention before Election Day.

The rumor has been out that Bush would wait until after the election and, assuming he is reelected, start floating the idea of consumption taxes. Underhanded, regressive, sneaky, and part of the usual screwing of the poor and middle class.

I'm beginning to believe these GOP plutocrats just don't care, that they want to stuff their pockets with as much money as possible and get their pensions and just leave society to pick up the damage. Now that I come to think of it, they do tend to run up deficits and leave someone else to deal with the consequences. Look at Virginia. Look at the Reagan and Bush II administrations.

[Cocoa]

24. saw the SC senate debate on C-span

the dem candidate was extremely effective at making this an issue, the republican's response was exceedingly lame, and he did NOT like talking about it.

[Anarcho-Socialist]

28. It would totally gut the U.S. economy and send it into recession

n/t

[mooky]

29. Actually, it's being stolen by repubs

The original idea was from the libertarians.

It is not regressive, taxes charged up to the federal poverty level is rebated. The poor would pay absolutely no federal tax. Right now, the poor pay a large portion of excise, transfer and other hidden taxes whenever they buy anything (like food or clothes).

Cutting out these hidden taxes would make the price of everday items go down, 30% by some estimates. I think we need some more research to prove this, though. I don't believe it just because some website says so. I can see the possibility, though. Once the costs of doing business goes down, the price goes down on items used by the masses (think Dialup Internet, Long Distance, Cell Phone Service). But, more studies are required to verify that this would actually happen.

It allows those who save money to do so tax free. An extra $50 for working late on Fridays sure would have added up in my emergency savings account if I didn't have to pay income taxes on it.

Here's the real kicker: A consumption based tax targets those that consume the most. Who is that? The family of five that saves for 3 years for a trip to the beach? No, it's the high falutin' rich folks who buy Rolexes at the drop of a hat, always go out to eat at expensive restaurants, and get a new Mercedes every year. Rich people can hire expensive CPA firms to get their tax burdens lowered. They then use that money to buy a new yacht. This type of tax would eliminate the loopholes they use. They're going to buy the yacht anyway, but they would pay tax on that every time.

One way to tell if something is good is to find out how much the ultra-rich are against it. Ultra-rich people HATE this idea.

Just some food for thought.

[lfs5]

31. So do the working poor...

How and when do you get your rebate? Will it be there every week when you need to buy groceries for a family of four-or six-or more, pay rent and utilities or make the housenote, buy gas for the car and school clothes and Christmas for the kids? Where do you get that extra 31% every week if you work a minimum wage job? Or live on social security with medicine to buy, in addition to your other expenses? Stretching a paycheck over 7 days is already quite a trick for a lot of people--stretching a single check over a month nearly impossible for many seniors.
I see this as the kind of problem than could put families on the streets. If every penny of your income is already allocated to current expenses, where do you find the extra you need to get you to rebate time? And how complicated would filing for that be? How much work would be involved? How many receipts would you have to keep to verify those taxes you paid?

[mooky]

44. No receipts, no paperwork

This is what "they say." I'm not convinced it will happen that way, but it's supposed to be a check that comes every month for the following month to cover purchases you will make. The size of your check depends on the size of your family.

Plus, this needs further verification, it is supposedly going to lower all prices. It may be something to look at, though. Nothing taxes the rich more effectively than consumption taxes.

[GaryL]

40. I alway love this flat tax BS.

First, what about medicare/medicaid/ss? Want to slap it on to a sales tax? Kick it up to about 30 percent then. Excise taxes? Oh please, where does this nonsense come from? Also, the tax system, believe it or not, has a great deal of incentives built in for stimualting various economic sectors. Like, for example, Kerry is proposing raising the minimum wage and cutting small business taxes. You can't do that based on your simplistic view of the tax system. Finally, your last premise is bull. Forbes proposed this crap back in 1996. I'd say he classifies as ultra rich.

[mooky]

45. This is not a flat tax

Forbes proposed the FLAT tax, not the consumption tax with rebates.

These are two separate things.

[AP]

57. A flat tax is a tax that doesn't account for the wealth of the person

paying it. A progressive tax taxes you in proportion to your marginal valuation of an additional dollar. The poorer you are, the more you value a dollar. A progressive tax is one that says it's unfair to charge a rich and poor person the same rate on the next dollar they earn because the poor person needs that dollar so much more. To distribute the burden evenly, you have to tax them in a way that burdens them equally. That means the poor person pays a lower marginal rate than the rich person.

A national sales tax is a flat sales tax. If you're poor, you still would pay the same rate on the next dollar spent as a rich person spends on her next dollar spent. It's not a flat income tax, but it is a flat tax.

[mooky]

82. Actually a flat tax is a tax

where everyone pays the same rate.

[AP]

87. Exactly. Everyone would pay 23%. Thus it's a flat (sales) tax.

[mooky]

125. EVERYONE would not pay 23%

Actually, the very poor would pay no tax.

Your argument about people going into debt every year isn't solvent, either. It is impossible to go deeper and deeper into debt every year forever. At some point the credit card companies cut people off.

But, that brings up and interesting point. Let's say a dot-com software testor who made $30K in 1999 got $35K in debt (car and credit cards). He lost his job and now works 3 jobs that total $25K now. He pays over $4000 in income and payroll taxes right now. Then he pays $4800 a year for his car and $1800 a year on his credit card. He has $14,400 to eat buy gas to get to work and pay rent.

Under the NST, he would not pay taxes to pay off debt, he would get $2100 in prebates, and would have a total of $20,500 to live. He then would pay $4715 in sales tax if he spent all of it, which brings his total after tax purchasing power to $15,785.

Under the old plan he pays $4000 a year. Under the new plan, he pays $2615 in net taxes. That's a 34% reduction. This assumes NO decrease in prices.

How is that regressive? It seems very progressive to me. It's also a very typical situation of how most people live these days.

[AP]

158. Please think.

You really don't think you can go deeper into debt year over year?

Avg. debt in US for bottom 20% of Americans is 10K. How do you think they went from 2k to 5k? From 5k to 10k? And 10k is just the average for that quintile.

People who declare bankruptcy get credit card applications (and get accepted) DAYS after they leave bankruptcy court.

Say your 25k earner goes back to college to get retrained, has to take loans out to pay for that, and has to start buying things on credit, hoping to pay it back when employed. Your 23% sales tax means he's paying tax on money he never sees. Just the act of paying taxes sends him deeper into debt than he would have been, forcing him to put even more on the credit cards, which means you're paying even MORE in taxes than you would have had to pay. then your 34% reduction becomes a big tax increase. You never have to pay income tax on money you didn't get as income. But the sales tax isn't so fair.

Oh, and if the bottom 20% of Americans are in 10k debt on average, where do you think the breakeven point is? 33% are worth 0 or less? For the bottom 1/3rd, you're paying tax on money you don't see. And the more you save relative to your consumption (ie, the definition of rich: you make much more than you spend) your tax burden decreases to almost zero.

Get it yet?

[mooky]

168. I get it

You are not open minded about this because you don't like who is backing it. I bet you were against welfare reform when it was proposed by the other side, too.

[AP]

177. I don't like it because I don't like the MATH behind it.

It shifts the burden on to people who spend a greater percentage of their income. It shifts the tax burden OFF of people who spend a smaller percentage of their total income.

The rich are rich BECAUSE they make so much more than they spend.

No matter how many exemptions you have, the burden will always be allocated away from the super rich. The exemptions only determine onto whom it shifts. If it's not the super poor, then it will be the middle class. And then if the advocates don't like that, they say they'll create more exemptions. But you can't shift the tax burden off of everyone. Then you have a society which can make no investments in the future, which can't build roads, which works best only for the people who can afford the high costs of everything. And I think that's what NST people actually want.

[mooky]

178. I think there is too much rhetoric

To have a factual discussion.

This idea more progressive than what we have now, or have ever had. The majority of withholding taxes paid by the middle class right now is Social Security, and this eases that burden greatly. You refuse to take that into account.

It's not worth discussing any more, because I've since been convinced by others that this is plan is a bad idea for other reasons.

[AP]

180. What's progressive about it?

It could potentially reduce the effective rate of taxation on a million dollar earner/100k spender down to 2.3% of earnings, and increase the effective rate of taxation on earnings of the (roughly) 33% of Americans who spend more than they make each year to INFINITY since it taxes you for money you don't earn.

Refuse to take into account SSI? Huh? That should be progressive to. Because it isn't doesn't mean we should shift over to somethign worse.

[Lydia Leftcoast]

42. Ah, yes, bedtime stories for libertarians

:eyes:

[mooky]

46. Well, it's not a bedtime story

It, like all other tax stories are nightmares.

The current system isn't working very well, though. Embedded taxes are truly turning the country into those of the "haves" and the "have-nots."

A gallon of milk for $3.29 has 32% of taxes built into the price. Nobody knows it because it's hidden. This just brings it all out into the open.

[AP]

71. It's more like a pipe dream for billionaires on crack.

[mooky]

84. Billionaires are against this idea

[AP]

88. You're batting 1000 when it comes to not knowing the facts.

Billionaires love this idea.

[mooky]

92. Billionaire love this idea

Which ones?

Warren Buffett hates it.
Michael Bloomberg hates it.
Bill Gates hates it.

[AP]

96. The ones who make money from selling goods to the middle class hate it.

The ones who make money from having money and don't care about a functioning economy love it.

[mooky]

99. Bloomberg?

What does Bloomberg sell to the middle class? He sells research and trading tools to financial managers.

[AP]

121. He sells advertising space to people who sell things to the middle class.

He's also, essentially, a Democrat who switched parties only so he could become mayor and his staff is almost entirely Democrats.

[mooky]

138. Bloomberg is a Democrat?

Why did Bloomberg, a Democrat have to switch parties to get elected as Mayor of New York? I thought New York was solidly left of center.

[AP]

157. The fact you didn't know this is incredibly revealing.

[mooky]

160. Revealing of what?

What exactly does it reveal, other than I don't follow NYC politics that much?

[AP]

167. it reveals that you don't know much about politics, which then means...

...you probably don't know much about policy.

It's similar to liking movies but not knowing who the actors are. If you didn't know that Harrison Ford was in Raiders of the Lost Arc I'd have to wonder if you had seen the movie.

[mooky]

169. That's a very stupid example

I know a great deal about policy, I just don't think a Democrat needs to run as a Republican in solidly Democratic NYC to get elected.

Nor do I think it is a good sign that you think that this is fine.

Do you really want to win "at all costs?"

[AP]

176. This wasn't the first thing you didn't know.

It was a pattern.

Win what at all costs?

[Bernardo de La Paz]

106. It's a myth that the rich "consume" more than the poor.

For the poor, things like shoes form a much larger percentage of their budget. The rich may buy Rolex's on a whim, but they spend a larger percentage of their income on stocks and hedge funds. You can bet those items won't be taxed, or else the stock market would fall because stocks couldn't be flipped fifty times in a month.

Simplistic analysis of simplistic ideas is not helpful.

The tax code needs to be completely rewritten into a slim volume instead of the person high stack that it now is. The hidden subsidies in the code, things like "furniture manufacturing companies in cities beside lakes in the state with the third largest area" and such, need to be converted into visible subsidies (grants) because that's what they are. That would end a lot of corporate welfare, but I'm not holding my breath.

[mooky]

111. The myth

It's a fact that a poor family consumes more of a percentage of their income than the rich, but not in real total dollars.

Real totals are what pays for this country, not a percentage. The poor spend 100% of their money on consumables - about $15,000 per year.

The rich spend that twice a year on a "consumed" vacation. This taxes that activity.

[Donkeyboy75]

163. Yes, and many of these vacations are to foreign lands

where the U.S. will recoup none of the taxes. Great idea.

[mooky]

171. Many, but not anywhere near most.

It's a fact that the majority of tourism is in this country. Give me something that refutes this.

[Donkeyboy75]

175. So you expect me to take your statement as fact,

while you have to back nothing up with evidence? I also never said that most vacations are abroad, anyway.

[mooky]

179. Good point

That's a good point, I was mistaken in my response.

You are correct, foreign vacations and cruises are not run by U.S. companies.

That isn't something that can be used to support this

[durablend]

136. Businesses LOWER prices?!? LOL!

Cutting out these hidden taxes would make the price of everday items go down, 30% by some estimates. I think we need some more research to prove this, though. I don't believe it just because some website says so. I can see the possibility, though. Once the costs of doing business goes down, the price goes down on items used by the masses (think Dialup Internet, Long Distance, Cell Phone Service). But, more studies are required to verify that this would actually happen.

Now it's obvious you're smoking something. Let's see...cost of business goes down so what should we (business) do? Give money back to consumer or pad profits even further with that extra revenue? HMMMMMMMMM...

Keep dreaming...

[mooky]

139. YES! Business lower prices.

"'Cutting out these hidden taxes would make the price of everday items go down, 30% by some estimates. I think we need some more research to prove this, though. I don't believe it just because some website says so. I can see the possibility, though. Once the costs of doing business goes down, the price goes down on items used by the masses (think Dialup Internet, Long Distance, Cell Phone Service). But, more studies are required to verify that this would actually happen.'

Now it's obvious you're smoking something. Let's see...cost of business goes down so what should we (business) do? Give money back to consumer or pad profits even further with that extra revenue? HMMMMMMMMM...

Keep dreaming..."

Explain how long distance rates and dialup ISP rates have gone down then? The costs of doing business and the barriers to entry went down, other people came in as low cost providers and the prices went down. Same with Cell Phone service, VCRs, computers, any of this ring a bell?

[GreenPartyVoter]

32. I can barely afford to buy anything now!

[dogman]

33. There was a luxury tax on yachts.

They removed it because it meant the loss of jobs for boat builders. What would the exceptions be for this tax? Big homes? Summer homes? luxury sedans? private jets? jewelry? One can just imagine what these corrupt bastards would exempt.

[mooky]

47. Agreed

That's why we can't have any loopholes.

[The Zanti Regent]

34. Pay 23% sales tax on EVERYTHING?

Can YOU handle a 23% Rent Increase?

Can YOU afford a 23% tax to go to the Doctor?

Can YOU afford a 23% tax on YOUR CREDIT CARD BILL?

Can YOU afford a 23% price increase on YOUR GROCERIES?

Can YOU afford a 23% tax on YOUR GASOLINE?

Can YOU afford a 23% tax on YOUR INSURANCE PREMIUMS?

Can YOU afford a 23% tax on YOUR NEW OR USED CAR?

Can YOU afford a 23% tax on LIFE INSURANCE?

Can YOU afford a 23% tax on YOUR FUNERAL?

Hell NO!

[mooky]

48. IF... this is a big if

IF it can be verified that prices on all goods drop by 30%, the price will stay the same.

Anyone that buys these things are already paying the tax, they are just built into the price.

[eriffle]

36. ARGH!!!!

People don't understand our tax system as it stands! People hear of the days when we had a 60% tax rate, they thought that 60% of ALL of their income went to the govt. Nope. Here's how it works. I'm using made up numbers and brackets for simplicity. We used to have a bunch of tax rates ranging up to at one time 90%, but it only applied to the money in that bracket. Like this. Say I make $100,000 and there are four tax brackets $0-$25,000 - 10%, $25,000-50,000 - 20% $50,000-$75,000 - 30% and $75,000-$100,000 - 40% It breaks down like this, my first $25,000 gets taxed at 10%, my next at 20%, my third $25k at 30%, etc. So when you say, the $100,000 tax rate is 40%, one would think I gave $40,000 to the govt, but in reality I only gave $25,000 You don't get punished by making more money, there isn't a magical level in which if you made one more dollar, you end up taking home less money than if you didn't make that extra dollar. It is an extreme misconception among the public, and the RW pundits play on their ignorance.

Coming from a future CPA.

[Lydia Leftcoast]

41. Actually, the top marginal rate was 91%

on incomes over $400,000 during the Eisenhower era, when America was booming.

(I just looked this up for a thread in Economics earlier this evening.) By my recollections of what things cost then, that's equivalent to about $3 million-$4 million today.

[phish420]

37. Great, so I would go from 17% to 23%

just take more money away from my poor ass. I would drop from $21,000/yr take home to $19,000/yr take home. Great plan repugs.

[mooky]

49. No

You get a rebate of about $2100 per year (if you are single). That means your actual "take home" or "purchasing power" stays the same if prices don't go down. If prices do go down - something that is said will occur but needs to be verified - your purchasing power goes up.

[AP]

61. It's even higher than 23% if you go into debt year over year.

Then you'd be paying tax on money you don't even have. Isn't that beautiful!

At least income tax only taxes you on money you actually recieve.

For the poorest 20% of Americans with an average net wealth of 10,000 who spend more than you make, you'd be paying 2,300 in taxes on "income" you never received. Cool. There goes that "exemption" the libertarians baited you with.

And the debt industry would love that too. It would mean that you go 12,300 bucks in debt, rather than 10,000, so you have to take out even more loans and pay even more in interest, which would be easy profit for them.

[mooky]

68. Not true

[AP]

72. It's true, as your textless post suggests.

[LimpingLib]

39. Thats all nice but as for AFTER the election can we......

...worry about bad legislation that has a chance of passing or HAS ALREADY PASSED?

Kerry bragged about voting for the 1997 budget well that is the budget that had the record setting savage cuts to Medicare that led to massive premium increases , and that was the ONLY cuts in that budget just about.

Lets tell him we expect him to restore the cuts ,maybe not now , but PLEASE for the love of God and country urge him at least after the political season to restore the funds he cut.

[Must_B_Free]

43. At least the super rich would pay SOMETHING

instead of nothing...

[mooky]

50. exactly

[AP]

53. Exactly wrong.

If you're concern is that rich people don't pay taxes, then lets fix the tax on earned and unearned income.

Let's not switch to a tax which would reduce tax burdens to zero for people who either spend a tiny percentage of their total wealth on consumer goods and/or which would be easy to avoid by only buying itmes that appreciate in value, or buy things from auction houses.

[mooky]

58. Things that don't appreciate

Cars, boats, motorhomes, vacations, country club memberships, vacations, anything that is consumable.

My concern is the current set of tax-engineering is being abused by politicians and citizens.

I'm not sold on this idea, but it is something worth considering.

[AP]

65. People who buy things that don't depreciate to zero would have a lower

tax burden than people who buy things that end up in the trash.

A ten year old mercedes is worth way more than a ten year old Yugo. Who buys the Yugo and who buys the MB? Who buys a timex and who buys a Rolex?

Since most poor people die with debt rather than assets, you can see who benefits from this.

[mooky]

67. That's not a proper analogy

The rich don't want a used mercedes. The poor don't buy NEW cars. Used goods would not be taxed in this scenario. The actual price for a used car would go down.

[AP]

75. You don't get it.

For the purchaser of a new item, you can lower your tax burden by buying something that retains its value and then sell it to someone who can afford it. It doesn't matter if the buyer is rich or poor. You just have to be able to sell it.

Now, if you want to avoid PAYING taxes, you just need to buy goods at auction or in private non-retail sales. Going to acutions is something rich people ALREADY do. With and NST it would be the primary way to avoid taxes.

Now, if you're a poor person and you spend most of your money on things like diapers, cheap clothes, cheap watches, or anything else that you throw away after you're finished with it, you can't reduce your burden by realizing the value of the thing you bought with a second sale.

Get it?

[mooky]

79. I get it

I just never see any rich people driving used cars, and they certainly don't buy used clothes.

Plus, there is no such thing as a used set of opera tickets or used vacations.

I see your point, but I don't think it's quite as extreme as you say it would be.

[AP]

85. My neighbor has '83 Ferrari 308 GTSi in addition to his Audi S8.

And I'm sure he'll sell the S8 at some point for a reasonable percentage of the purchase price, which helps offset any sales tax he paid on it. He bought the Ferrari used.

I also had a friend in serious debt in college who drove a Yugo which he junked when he was done with it. He didn't get to offset the sales tax.

[mooky]

95. Anecdotal

This is an anecdotal story.

But, that Ferrari needs service. Very expensive service. 23% tax rate on that service. That means he pays way more in taxes to service his car than the total bill for your friend's Yugo.

[AP]

98. Your argument was an anecdote. You can't do math, so I thought the

anecdote would help.

[mooky]

100. I can do math

Explain where my math is wrong. Give an actual example that involves calculations.

[AP]

101. ...and not every state has a service tax. And that Yugo also needed a tone

of service -- a higher % of value of car, and my friends income relative to the F. owner's for that matter.

[mooky]

107. Look at the math

It's not about who pays what for service relative to the value of the car, it's about who pays most of the taxes right now. That's the person who drives a Yugo, pays payroll tax, buys milk, diapers, clothes and shoes.

I see one problem here why you disagree. Although it helps the poor, you don't like it because it doesn't punish the rich enough.

[AP]

120. No. Look at the math. It's the tax BURDEN.

It's whether the amount of taxes you pay on your next dollar reflects your wealth.

My friend paid a bigger % of his income on things that would incur taxes with a NST. That is NOT right.

[mooky]

134. BURDEN - which is better?

Which is better? Increased percentage burden but more after tax money or the current system of decreased burden but less after tax money for those that need more money?

I'll agree it doesn't punish the rich as much as you like, but it makes life better for those on the lower scale.

[AP]

159. Who does it make life better for? I'd rather have an earned income credit.

...and still have progressivity than throw the super poor a useless bone so that the super rich have a tax code which allows them to amass incredibly economic, political and cultural power.

[mooky]

161. A plan like this

Would make life better for anyone who consumes necessities more than luxury items.

The current system isn't doing what you want, either. We should stick with that?

[AP]

166. This system will ensure that there are a lot of Americans who consume

necessities and not luxury items.

And it will discourage the consumption of taxed items. And the super rich will never buy enough to make a big enough contribution to the infrastructure so that we can create an educated society with good transportation infrastructure which could get wealthy from their own labors.

The current system isn't working because it isn't progressive enough and not becuase it's progressive at all. So why take the regressivity and push it to hyper-regressivity?

[mooky]

170. I disagree

And I guess we'll just have to leave it at that.

[AP]

51. They'd still pay nothing. Rich people would buy items that appreciate or

buy things at auctions and in private sales (which aren't taxed).

The burden of a tax on consumables and other gooods is burdensome in proportion to the value of the thing you buy. If you buy a rolex, the burden = ((price+tax)-resale value)). So, for items that retain their value or increase in value, your burden is lower than items that depreciate rapidly.

Rich people buy things that retain or increase in value, while poor people buy things that end up broken or in the trash. That means that the sales tax really would be infinitely less burdensome than income tax.

[FlaGranny]

104. I saw something on TV not too long ago

about this. It wasn't about taxes, but about wealth. When you reach a certain wealth level, you tend to buy many more items that appreciate in value like art, other collectables, real estate, etc. The lesson was, don't buy cheap stuff, save until you can afford to and then buy something that will appreciate. Easy for THEM to say. They probably have a lot more than $20,000 or $30,000 a year to play around with.

[mooky]

108. no taxes are paid on the at this time either.

[FlaGranny]

142. ??

Huh? I think you left out a word? :-)

[mooky]

144. Oops, Flagranny

I meant to say "No taxes are paid on them now either."

[FlaGranny]

149. No problem!

I do stuff like that all the time. Brain gets going faster than the fingers.

Do you mean no taxes are paid on art, collectables and real estate? I pay taxes on all those things. What am I doing wrong? You mean the rich are screwing me twice, once by having the money to buy lots of that kinda stuff, and again, by not paying taxes on them?

You're right in the sense that the rich are able to avoid taxes to the point of sometimes not paying any, while raking in millions. I'd prefer to maintain my tax rate at the lowest rate and have the rich pay at least their fair share. Hell, we'd be better off if everyone was required to pay at least the lowest rate on their ENTIRE earnings. While many of them pay taxes on perhaps a million dollars, the actual earnings may be in the tens of millions. LOOPHOLES. Get rid of the loopholes that only help the richest folks and their tax accountants. I have no loopholes.

I believe it is totally unfair to tax purchases and exclude income. If I need a cheap new car it costs me a whole lot more percentagewise than it does for a rich man to buy a Ferrri.

[secular_warrior]

52. Dems should push to abolish sales taxes and all regressive taxation. EOM

[mooky]

60. And replace it with what?

What would we replace the current sales tax with?

[AP]

62. Real progressive income tax on earned and unearned income. Duh.

[mooky]

64. How?

How do you do that when income is so easy to hide?

Also, what is "unearned" income?

[AP]

66. Unearned income is dividends and capital gains.

Both of which are NOT taxed progressively. They're taxed at either 25% or 15% depending on HOW LONG YOU HELD THE ASSET!!!!

Earned income stops being taxed progressively at about 300k for married filing jointly's.

Clearly we need to tax unearned income progressively -- lump it into earned income, or tax it in tiers at separate rates that are related to your adjusted gross income. Clearly we need to have more income tax bands too. Lower the ones we have on income under 300k and create new bands on income over 300k and have bands that increase in increments all through the millions and ten millons and 100 millions so that people who make more money pay at higher marginal rates than people who make less money throughout the realistic range of incomes earned in America. People who make 300k a year do NOT have the same marginal valuation of a dollar that people who make 100 mil have.

[mooky]

74. There is a bit of a problem with that

The problem with the making the system that progressive is that is shifts the burden of paying taxes to a very slight minority of people.

Under that scenario, people who don't pay any (or much) in taxes at all are able to increase taxes at will. Since it doesn't affect them, they don't care.

But that sets the stage for people that control the wealth to then have all the power. The ultra-rich can get together and shut down the government by simply closing their companies for a year. They have enough money to survive, so they wouln't care.

I'm not against progressive taxes (and I believe this one is), I'm just against having the source of that much resources rest on so few people.

[Name removed]

80. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Bridget Burke]

89. "close your corporation for a year" --- Ayn Rand?

"Atlas Shrugged", I believe. After all, those rich people are all rich because they're smart & hard working. The poor people are stupid & lazy. Threfore, we must do everything we can to help the rich people or our economy will die!

What would Paris Hilton close?

[AP]

90. Her knees.

[mooky]

97. Ayn Rand?

No, but that is interesting. I never thought about a total revolt, just a tiny one to show the government who's boss.

[Bridget Burke]

109. The really-rich are already the boss of the Republicans.

And some Democrats, alas.

Most of us read Ayn Rand in 10th grade & got over it by graduation.

[mooky]

114. Not a fan of Ayn Rand

I'm not a fan of Ayn Rand, but some of it makes sense. I don't think it's quite the "global meltdown," but those that pay certainly are in control.

[mooky]

91. What small business could replace Intel today?

Look, I'm just trying to have a discussion here. If you disagree, that's fine. There's no need to call me names just because I have a different opinion.

I think right now there is a system of embedded taxes that cause the price of everything to be inflated. That means that anyone that buys the products of companies that have to pay hidden taxes end up paying that tax. That is the ultimate in regressive taxes.

I think that income taxes don't necessarily help anyone trying to get ahead, and they completely favor those that can afford to buy or find loopholes.

I think the one constant trait in all rich people is that they consume a whole lot more than anyone middle class or poor. Taxing consumption is fair, and progressive.

Under the current system someone with $10 million in a trust fund can pull $250K per year out of it and live a lavish lifestyle for 40 years without paying a dime in income tax. I think they pay their share of federal hidden taxes, but they pay much less than those who work for a living.

I've said that there are things that need to be verified, and ONLY if the price drops occur would this plan be a good thing.

I have no problem with people arguing with me, but let's back off on the name calling.

[AP]

94. Intel is NOT going to close up for a year. And there probably is enough

competition in the chip market that if they did, they'd go out of business.

I didn't read the rest of your post because it's clearly a waste of my time.

[yellowcanine]

59. This would create a huge underground economy that would make Prohibition

look like a tea party, imo. If you don't believe me, read up on the problem of cigarette smuggling and the involvement of organized crime and terrorists. http://www.townhall.com/columnists/brucebartlett/bb20020806.shtml (Conservative Columnist alert)

Any sales tax that large will provide huge economic incentives for avoiding it, and otherwise law abiding citizens will get caught up in it because they will rationalize the illegality by saying the tax is unfair. We also forget that the American Revolution was triggered by opposition to British exise taxes.

[mooky]

63. American Revolution

The American Revolution was a revolt against taxation without representation, not taxes in general.

The underground economy would be impossible to sustain on a national level for everything.

[AP]

69. It would create an "underground" economy for tax evasion purposes...

...not for philosophical purposes.

I presume that's what the poster means.

However, it woudln't even need to be underground. NST people already say that they wouldn't tax resales (and there's good reason for that too). Southeby's wouldn't have to go underground. Auction house sales wouldn't be taxes at retail sale. It'd be taxed as income to the seller. Oops. But guess what? We would be getting rid of income tax. So, you'd evade taxation by buying and selling at the auction houses.

[mooky]

76. Auction houses

Only sell used items. There would be no way to avoid paying taxes on new items.

[AP]

86. In American we don't tax non-retail resales for good reason.

We encourage the cycling of goods. If we taxed non-retail resales, it would encourage vertical monopolies. You probably don't understand that, but I can't spend all day explaining reality to you.

Nobody proposes that non-retail sales incur a sales tax. There's no way around that. Auction sales are taxable to the seller as income today. But if you had no income tax, they wouldn't be taxed at all.

[mooky]

103. No tax ONLY if you bought ALL used items

Who buys most of their stuff used - rich or poor?

How do you buy a "used" cruise around the world?

[yellowcanine]

129. My state has a sales tax on used cars - what makes people so sure the

final version would exclude "used" items. That would be the biggest loophole of all. Lots of tricky ways to "launder" new items and make them appear used. And preventing this? Talk about paperwork. Every "used item" would have to be accompanied by a receipt showing that the tax was paid when it was new. Records would have to be kept of those items as well for cross checking.

[mooky]

135. The paperwork already exists

Cars are titled every time they are sold. They are either titled as "new" or "used."

[Donkeyboy75]

164. Hahahaha

And do you want to explain how a cruise around the world is going to lead to U.S. tax revenue?

Most cruise lines are run by non-U.S. based companies.

[mooky]

154. More condenscending stuff

It appears you probably don't understand how coporate income taxes are factored into EVERYTHING we buy, including services. Talk about a vertical monopoly!

The person who got money for selling something at an auction house would pay that tax when they spent that money.

[AP]

181. Wealth is taxed everywhere it passes. When you tax a workers earned income

it means that the worker demands more from the employer. That's the way it goes. I don't have a problem with that. If we didn't tax the places money changes hands, all money would change hands through the untaxed channel.

[pffarrell]

78. The propaganda for this

was funded by a Houston millionaire. Quelle surprise...

A good (but old) article:

http://www.tucsonweekly.com/gbase/currents/Content?oid=oid:42368

Hope that worked, it's my first link

[mooky]

81. Just because he's a millionaire...

Just because he's a millionaire doesn't mean it's bad.

George Soros is a billionaire, so it Steve Jobs, even John Kerry and John Edwards are millionaires.

Do we trust them (at least more than *)?

[pffarrell]

102. Didn't say he was bad person

but it stands to reason he's not going to spend a fortune promoting something just so he can pay more taxes. There are about a zillion reasons this idea sucks :

Bill Gates (and other billionaires) spend only a fraction of their incomes each year. If they're only taxed on what they spend then their effective tax will drop dramatically - people who do spend what they earn will have a higher effective tax rate (as the article above shows, when they say 23% they really mean 30%). And people who have the same income, let's say a single parent with three kids and a plain old single, will pay on what they spend, giving them a 100 %tax break on their savings. No bonus points for guessing who's less likely to be saving much. If the rich pay less, someone else will have to make up the difference - again, no bonus points - otherwise, government wil have to cut back dramatically on what it spends - oh wait, that was the idead all along wasn't it?

[mooky]

105. Revenue neutral

This idea is revenue neutral. No decreases in spending.

Bill Gates will pay according to what he consumes.

The working family will not pay any federal income or payroll taxes at all. IF - again this needs to be verified- the prices go down due to eliminating the hidden taxes, the working family will pay much less in taxes.

[pffarrell]

113. Did you read the article?

I think you need to sit down a calculator and do some sums. It is a completely illogical idea designed fo rth gullible. Even Bill Gates can only spend so much, you know - by the way, if he buys a Caribbean island or something, would that be taxed? If so, by who?

[mooky]

115. Yes, I read the article

I read the article. Bill Gates is in a class all by himself when it comes to not paying taxes if he doesn't want to.

But, everyone else (except the serial vacationers) benefit.

[pffarrell]

126. Last post on this

Everyone CAN'T benefit if it's revenue neutral - if one person benefits someone else has to pay. FICA taxes may be regressive, but the income tax is progressive. I agree get rid of all the loopholes, but taxes on spending are the most regressive of all. I'm not sure what these 'hidden taxes' are that would be saved - prices are not going to go down. Ok, an employer doesn't pay payroll tax - but he's got to to raise his employees' salaries to cover the taxes he's not paying which are now falling on his employess. Tax unpaid in one place must be paid somewhere else. And it is a fact the richer you are, the less percent of your income you actually spend. People WILL go to Mexico, Canada or wherever to shop. I live in England and people go to France to get wine for £1 or 2 savings (of course they buy about a £100 bottles at a time!) Plus people would stop going to the US to shop as they do now.

My last example: my Mom is 76 and still works full-time. Her house is paid for, she's careful with her money and she is better off now than at any previous time in her life. Her biggest expenditure is without doubt when she comes to visit me here. I grew up in a family of 6 kids and not a lot of money. The utilities got cut off quite a lot. Please tell me why you think it would be fair that she pay much less on taxes now, when she can afford to, than then, when she couldn't.

[mooky]

131. She would pay more

"My last example: my Mom is 76 and still works full-time. Her house is paid for, she's careful with her money and she is better off now than at any previous time in her life. Her biggest expenditure is without doubt when she comes to visit me here. I grew up in a family of 6 kids and not a lot of money. The utilities got cut off quite a lot. Please tell me why you think it would be fair that she pay much less on taxes now, when she can afford to, than then, when she couldn't."

Her trips to see you would cost her more. That would not be offset by eliminating her payroll taxes. She can afford to do more, so she does. She then pays more taxes.

Thanks for the comments.

[pffarrell]

148. OK one more

She doesn't spend it - she just saves it. And when she comes to see me, she spends her money in another country. The only thing she pays for in the US is the flight.

And re your further post below - it's just a question of perspective whether it's 23% or 30% - most people when you say 23% think 23% on the total, not a net 23% on the tax-inclusive amount. So at the very least the proponents of this need to start being honest about their terms.

[mooky]

151. Huh? What does a 7% sales tax mean to you?

In Georgia, there is a 7% sales tax in Fulton County. The price tag says $1.00, you pay $1.07 at the register. Same for this. The price tag says $1.00, you pay $1.23.

How is that not honest?

[pffarrell]

153. 7%

"Fair Tax supporters don't actually say their proposal would require a 30-percent tax, however. They call it a 23-percent "tax-inclusive" rate. In other words, they've arrived at their 23 percent number by figuring that $30 is 23 percent of $130 -- the $100 price tag on an item, plus the 30 percent tax -- "which isn't the way anyone thinks about a sales tax," says Ettinger. (See "Tax Cheats, Tucson Weekly, December 10, 1998)."

[mooky]

156. Excellent point

Thank you for bringing that up. I have no idea where they get that.

From H.R. 25 (the fair tax bill)

http://thomas.loc.gov/cgi-bin/query/F?c108:1:./temp/~c108pxLawc:e9026:

`SEC. 101. IMPOSITION OF SALES TAX.

`(a) IN GENERAL- There is hereby imposed a tax on the use or consumption in the United States of taxable property or services.

`(b) Rate-

`(1) FOR 2005- In the calendar year 2005, the rate of tax is 23 percent of the gross payments for the taxable property or service.


What am I not seeing here?

[RB TexLa]

110. Other proposal from US Rep Chaka Fattah (D- Philadelphia)

Has asked Treasury to study this to see if it might work. I'm not advocating this, I have not studied it or even know if it could work, but it is an interesting idea.






Fattah idea: Toss income tax, use 'transaction fee'
Steve Goldstein INQUIRER WASHINGTON BUREAU
The Philadelphia Inquirer
February 15, 2004
Section: NATIONAL
Edition: CITY-D
Page: A11

U.S. Rep. Chaka Fattah wants to make April 15 a national holiday.

The five-term Democrat from Philadelphia wants to scrap the federal income tax system and replace it with something called a "transaction fee."

So instead of racing to the post office, you'd be going to Comcast World (formerly Disney World).

The term "1040" would have no meaning, like "wardrobe malfunction."

H&R Block would be preparing college applications.

On the 90th anniversary of the implementation of the income tax, Fattah has introduced a bill directing the U.S. Department of the Treasury to examine his idea and see whether it will fly.

Fact: No country has ever had a transaction fee-based tax system.

And second: You never know.

Fattah said he's been thinking about overhauling the tax system for a long time, but the transaction-fee idea came as he was getting cash from an ATM.

"I paid a fee to access the cash," he said in an interview. "It was the simplicity of that. You utilize a service and you pay a fee."

Basics of the plan

Here's how Fattah's plan would work:

The transaction fee would eliminate all federal taxes on income and profits. It would apply to any transaction that uses any form of payment - cash, checks, credit cards, transfers of stock, etc. It would be collected on all retail and wholesale sales, all purchases of goods, and all financial transactions.

Only checks or electronic transfers issued by employers for their employees' salaries would be exempt. Additionally, the fee would not apply to cash transactions of less than $500.

The proposal offers several options for setting the fee.

One is a certain flat percentage share.

Another is to set a progressive rate schedule - the percentage escalating with the value of the transaction.

Finally, there is an option to set the fees at several tiers for different value transactions - a $5 fee for transactions of $1,000 or less, $50 up to $10,000, and so on.

As envisioned by Fattah, the transaction fee would conceivably bring in additional revenue above what is currently generated by the income tax. He says these funds would be used to eliminate the national debt, provide universal health care, and support an equitable public school finance system.

The beauty part, of course, is eliminating the complexity of the current system. The Internal Revenue Service's net cost of operations in 2002 was more than $10 billion, according to the General Accounting Office. The Office of Management and Budget estimates Americans spend 6.7 billion hours annually doing tax returns.

Estimating labor at $30 an hour, OMB calculated that it costs Americans $200 billion to comply with federal tax law.

A year to analyze idea

In his "Transform America Transaction Fee of 2004," Fattah asks Treasury to analyze his idea and report by next February. He'll meet with Treasury officials later this month.

"I've taken the idea to a point where you need a formal study," he said.

Fattah's proposal to scrap the income tax has a long and noble heritage. Various politicians, including Sen. Arlen Specter (R., Pa.) and former presidential candidate/multimillionaire Steve Forbes, advocated a flat tax that sets a single rate.

The value-added tax, widely used in Europe and other countries, is imposed only on a part of a transaction's value, roughly the difference between an item's selling price and its cost, thus avoiding multiple layers of taxation.

It is those multiple hits that trouble economist Alvin Rabushka, who said the transaction fee would hurt all companies that pay other companies for the work that goes into producing a single product.

Rabushka, known as the architect of the flat tax, is troubled that the transaction fee would hurt start-up businesses that now can carry tax burdens forward until they become profitable. He also said the fee would reduce the tax burden on wealthier citizens, as the top half of income earners currently contributes about 96 percent of tax revenues.

Plus, he said, the transaction fee would create a "spectacular" enforcement problem because all transactions between $500 and $999 "would be broken in two" to get the exemption.

"You break up all your transactions into little pieces," agreed tax expert William Niskanen, head of the libertarian Cato Institute in Washington.

Of the overall plan, he said, "It's weird, but appealing because of its simplicity."

An analysis requested by Fattah from the Congressional Research Service praised the idea for eliminating most of the compliance costs - since implementation of the fee could piggyback on existing federal and state infrastructure - and for potentially capturing revenues from "underground economic activity" that currently evades taxation.

[American Tragedy]

112. I also find it ironic

that they would want to negatively reinforce spending and the circulation of money in our economy by dramatically raising consumer prices. I question whether this would benefit our economy as a whole.

To be fair, I honestly don't know if the VAT over there had anything to do with this, but what dismayed me most when I was in Europe was how goddamned expensive everything was. I had to buy far less of every single thing that I needed. It was one thing I really missed about America.

[w4rma]

116. They want these ads censored because they know that their OWN BELIEFS

their OWN POLICY is extremely damaging to themselves.

I never give them hell. I just tell the truth and they think it is hell. - President Truman talking about Repugs

[mooky]

118. They want these ads pulled off

Because they are playing politics. They say that the ads are spreading lies, just like Bush says the Moveon.org ads are lies.

Keep them all on or pull them all off, I say.

[mooky]

117. This was just a discussion, anyway

No Republican is going to give up the power of mucking with the tax code for donor benefit.

But I think this is a progressive idea.

Payroll taxes are regressive
Excise taxes are regressive
Corporate taxes that get built into the price of goods are regressive
Tax loopholes that only millionaires can get are regressive
A tax code that requires expensive accountants to understand is regressive.
Taking a cruise to visit an investment property in St. Kitts and writing the entire thing off is regressive

[Bridget Burke]

119. And the OP didn't even stay around...

This idea--along with the flat tax--comes up regularly here.

And both ideas are rejected.

[Politicub]

123. Those commercials are running here in Atlanta

How could you ever afford to buy anything? I have trouble saving money as it is. Imagine if you had to pay 23% more than the actual price for anything and everything. It's an insane proposal.

When you starting thinking about a high price purchase, like a car, a 23% tax rate would add $2,500 to each $10,000 of the purchase price. This has to be one of the worst GOP ideas ever floated.

What planet are these people from?

:wtf:

[mooky]

127. Politicub

Give me a "what if" scenario. Give me an income bracket, the amount paid in federal taxes, and the size of the family.

I'll demonstrate the numbers for you.

[Politicub]

132. It's useless for me to debate this with you

You are so set in your dormitory kewl libertarian ways that no matter what I say will further this discussion.

I can only wish you good luck in your personal crusade to convince others this tax sham would be beneficial for the poor and middle class.

[mooky]

137. Yup, it's useless

I guess it is useless. I don't dismiss ideas just because the other side is promoting them. I have seen many examples where everyone on the lower end of the scale benefits.

It's not a "kewl" thing for me and I'm not arguing from a Libertarian standpoint (other than to say that's where the Repubs stole it).

I asked for an example to demonstrate to you and you left the conversation. I'm not set in my ways and have given my reservations about this (the price decrease thing NEEDS to be proven). I think you are the one set in your ways.

I don't get it at all.

[Politicub]

143. Ok, I'll bite

Maybe I was just hungry and needed some lunch when I wrote my first reply to you. It was rude. Sorry about that. I just haven't had a good track record of debating with folks who adopt a purist libertarian POV. I don't think you fall into that camp, though, although that was my first impression of you.

When my partner and I were discussing the commerical for the consumption tax, I realized that I don't know enough about macroeconomics to effectively argue OR believe someone else's argument for or against the plan. What I do know is that tinkering with the tax code will create major change, and it can be for the good, but most likely for the worst. It's hard to imagine (for me anyway) any kind of great upheaval of any of the systems in use in the US where changes will bring about a better deal for the most helpless folks in our society.

Anyway, I just wanted to appologize for my rude remarks to you.

:toast:

[mooky]

146. Apology accepted

You make an amazingly valid point about upheaval with vast extreme changes.

That is certainly something I hadn't considered before.

[amazona]

124. good keep the heat on this *****y idea

A 23 percent national sales tax, on top of the 9.75 percent sales tax in my area (and no doubt in many other areas), would kill the legal economy.

Although I'm sure it would be great for the crack houses where they have a sideline of selling electronics, jewelry, etc. that people have traded for drugs. It would sure fuel home invasion and robbery, that's for real.

[mooky]

128. Tax on crack

No taxes are paid on crack right now, so that's not a good argument. But, income made by crack dealers isn't taxed now either.

This would change that. Drug dealers buy lots of gold and new cars. This alone isn't justification for passing this, but it negates your point.

[pffarrell]

130. when they say 23% they mean 30%

See link above to article in Tuscon Weekly

[mooky]

133. 23%, not 30%

It's an approach error.

It is a 23% tax on purchases. It is a 30% increase if you apply the tax paid on the after tax purchase power figure.

It's similar to this:

A person makes $100K a year and pays $25K a year in income tax. That's 25%. But, since that person only has $75K per year to spend, it can be said that he pays an amount equal to 33% of his spendable income on taxes every year. Can he claim that he's taxed at an "effective rate" of 33%?

No, looking at the totals, he gets $100K per year and spends $25K on taxes and $75K on himself. So, it's really 25%.

[blindpig]

140. what a hoot

THEY are the ones who broached the subject, it was the centerpiece of Jim Demented's campaign. Inez's counter ads have been devastating, even my dim neighbors can smell the stench from this one.
Can it be that the American people are not as stupid as the repubs think?

[mooky]

145. I'll agree

It's completely stupid and hypocritical to try to ban these ads. But, it's not that unpopular of an idea. If it were, those wussies at the GOP would run for the hills.

[newportdadde]

147. The assumption with a Sales Tax is that prices will be lowered....

this is implies an implicit trust in corporate America which is misplaced trust. If you and I sell widgets for 10 bucks and total costs is 5 dollars we make 5 dollars profit. Lets say the changes to a sales tax would make our costs to 2 dollars. Now do we both lower our prices 3 bucks.. we would just end up at the same place.. no of course not we just sit tight and pocket the rest for our share holders or at best lower it a dollar.

The flat tax like 15% my friend just loves. My argument is that it would immediately raise taxes on millions.. his response... it would 'encourage' people to get better jobs... yeah I'm serious he says that.

Anyways its a bullshit deal. If I'm a teacher making 30k and you take 15% that is an increase in taxes for me. If I'm a millionare its a decrease. You just lost buying power quite a bit actually given the cost of goods but as a millionare my buying power just skyrocketed.

As a final note both of these methods will NOT provide sufficient funding for our current spending by any stretch of the imagination. Its simply a smoke screen for the rich to pocket even more cash off dividends, day trading stocks etc(bye bye short term capital gains).

[harpo]

152. Sounds like something repukes would do...great ads taking advantage :)

[Hong Kong Cavalier]

162. When was the last time that a tax plan the Republicans proposed...

ACTUALLY HELPED THE LOWER CLASSES MORE THAN THE UPPER CLASSES?

Sheesh.

I can't believe we're discussing this AGAIN.
Pity the archive search is down, or I'd drag that thread from GD up that happened a month or two ago.

:eyes:

[mooky]

172. This is like talking to a brick wall

Come on, people. This idea isn't bad JUST because it comes from the other side.

I heard some very valid points about this plan, and I'm not sold on it by any means. But this whole idea that it's some evil thing is wrong. The progressive/regressive/not progressive enough argument is crap.

Social Security is probably the most regressive tax in history. What other tax is levied on only those who work and has an upper limit so low that a very large part of the middle class earns money that is exempt from it, but EVERY working poor person must pay it.

The consumption based tax may have it's problems, but it removes the oppressive regression of Social Security. Does anyone think that helps? Would any of you fighting me on the progressive/regressive thing support Social Security if it were a new proposal? Even if a Democrat proposed it?

[Hong Kong Cavalier]

173. I think most of the people here could say the same thing about you, Mooky.

We've gone over this multiple times, and you simply state "The progressive/regressive/not progressive enough argument is crap." WITHOUT ANY PROOF TO BACK IT UP. I've read and re-read your posts, and you didn't offer any proof that a nationa sales tax is ANY BETTER than what we have now.

A consumption tax would simply hit those with lower incomes hardest. They are already living from paycheck to paycheck. Any plan from the Republicans will eliminate all taxes on dividens, because that's what they want. The lower classes do NOT HAVE THAT MUCH in stocks, unlike the upper classes.

I said it before, and I'll say it again: IT CAME FROM THE REPUBLICANS. Your reasoning for it being good is like trying to defend piss-down economics (that's "trickle-down" economics, if you didn't know.)

And by the way, HELL YES I'd oppose it if a Democrat propsed it.

[mooky]

174. The question was about Social Security

Would you oppose it if it were a new proposition today?

[Nimrod]

165. Average americans can forget about...

Ever buying a car, house, computer, appliance, or anything else costing over 400 dollars. It will never be yours. Ever.

And god forbid if you ever win anything, since you have to pay sales tax on non-monetary prizes.