@Foxfyre,
Foxfyre wrote:
The reason the Fair Tax is regressive is that it takes such a higher percentage of income from the lowest wage earners.
No
Also, under The FairTax Plan the lower wage earners get a pre-bate check from the government to cover necessities.
@H2O MAN,
H2O MAN wrote:
Foxfyre wrote:
The reason the Fair Tax is regressive is that it takes such a higher percentage of income from the lowest wage earners.
No
Also, under The FairTax Plan the lower wage earners get a pre-bate check from the government to cover necessities.
No? Then explain to me how the math I used for illustration is in error.
I mentioned the pre-bate. Everybody doesn't get it? How is that Fair?
If just the lower wage earners get it, how do you eliminate the IRS as folks will still have to file their income tax forms to get the pre-bate? And how does that take the temptation for corruption out of government if the government can decide who is eligible for the prebate? And how does that not just swap one humongous government bureaucracy for another?
I'm not meaning to be difficult here. But if you can make me understand it, perhaps others will be able to understand it too. And I'll be honest. Right now I don't.
@Yankee,
You miss the point. If taxes are no longer based on our income and only our purchases, the new problem is that now the drug dealer now has a perfect means to launder their income.
Beyond that, you have a newer and larger problem in terms of tax fraud. It would be so much easier to do under the table deals.
It also seems that this would hurt American brands.
T
K
O
The point is: D TKO has NO EFFING CLUE, but does posses a criminal mind.
@Foxfyre,
My bad, we all get a pre-bate check.
@H2O MAN,
I'm glad you get along so well with the conservatives here Kevin. You only end up embarrassing yourself and reminding those reading that these super conservative ideas really appeal to total idiots like yourself.
T
K
O
@H2O MAN,
If you have to have "conservative" defined for you, you're way out of your league here on a2k. Why don't you just go play with other teenagers like yourself.
@cicerone imposter,
cicerone imposter wrote:
If you have to have "conservative" defined for you, you're way out of your league here on a2k. Why don't you just go play with other teenagers like yourself.
I think he's a full grown man, that's what is scary.
T
K
O
AN ILLUSTRATIVE COMPARISON OF FEDERAL TAXES FOR:
10% FLAT GROSS ANNUAL INCOME TAX WITH ZERO CORPORATION TAX,
10%/15%/25% CURRENT INCOME TAX (married filing jointly) FOR GROSS INCOMES LESS THAN $137,050,
12.5% FLAT SALES TAX.
10% TAX ON GROSS, OR 10%/15%/25% TAX ON NET, AND
0% TAX ON CORPORATION NET REVENUE
Social Security = S = 19110.59
Retirement = R = 19110.59
S-Corp Profits = P = 19110.59
Normal Paid Stock Dividend = NPSD 19110.59
Additional Dividend if Cap Gains Tax is zero= AD = (NPSD/0.7)-NPSD = 8190.25
Gross Annual Income = GAI = S + R + P + NPSD + AD = $84,632.61
10% TAX ON GROSS INCOME = $8,463.26
Standard Deduction = D = 15000.00
Social Security Exemption = E = 0.4*S = 7644.24
Taxable Annual Income = TI = Ga - D - E = $61,988.38
10/15/25% TAX ON TAXABLE INCOME = $8,463.26
ASSUME ONE SPENDS PPI = 80% OF THEIR INCOME ON PURCHASES
ASSUME THE SALES TAX IS A FLAT TAX ON ALL PURCHASES = STP
Gross Income = GI = $84,632.61
Purchases Percent of GI = PPI = 80.00%
Sales Tax Percent = STP = 12.50%
Annual Sales Tax = AST = GI * PPI * STP = 8,463.26
But if STP = 23%
THEN AST = $15,572.40
Difference = $15,572.40 - 8,463.26 = $7,109.14
Note that the tax for an example gross income of $84,632.61, is the same for a 10% flat tax, a current 10%/15%/25% income tax, and a 12.5% flat sales tax. However, a 23% flat sales tax is $7,109.14 more than each of these other taxes.
@H2O MAN,
TKO, define "conservative"... I honestly don't think you know what the word means.
@H2O MAN,
I'll try this a third time: If the flat tax is an income tax, then how can you say that it also taxes purchases?
@joefromchicago,
joefromchicago wrote:
I'll try this a third time: If the flat tax is an income tax, then how can you say that it also taxes purchases?
I'll explain it again.
The flat tax is an income tax.
The existing sales tax is an additional tax.
With the flat tax you pay both the income and sales tax.
With The FairTax Plan there is NO INCOME TAX.
The FairTax Plan is a consumption sales tax that replaces the income tax.
Clear as mud, right?
@H2O MAN,
No, it's not clear Squirt.
Quote:The flat tax is an income tax.
The existing sales tax is an additional tax.
With the flat tax you pay both the income and sales tax.
I pay no federal sales tax. I only pay state sales tax.
Quote:
With The FairTax Plan there is NO INCOME TAX.
The FairTax Plan is a consumption sales tax that replaces the income tax.
If the federal income tax disappeared tomorrow I would still pay STATE income tax.
@parados,
Parasite is a little slow...
Both the flat and FairTax are federal taxes and they have nothing whatsoever to do with state taxes.
This distinction was clearly made earlier, but some prefer to ignore the facts and troll.
@H2O MAN,
Let me try to explain this. And since I'm not
parados, maybe you'll actually pay attention to me:
H2O MAN wrote:The flat tax is an income tax.
The existing sales tax is an additional tax.
With the flat tax you pay both the income and sales tax.
That's only true because sales taxes are levied by states, not the national government. In effect, what you're saying is that, if the flat tax is enacted at the national level, people will end up paying federal income taxes and state sales taxes. But then if the "fair" tax is implemented and a national sales tax is levied, most Americans would still pay a state income tax. So if the "fair" tax is implemented, instead of people paying a federal income tax and a state sales tax, they'll pay a federal sales tax and a state income tax. That being the case, it's just as accurate to say that people will still pay an income tax on top of the "fair" tax as it is to say that people would still pay a sales tax on top of a federal flat tax.
H2O MAN wrote:With The FairTax Plan there is NO INCOME TAX.
Correction: there's no
federal income tax.
H2O MAN wrote:Clear as mud, right?
Just about.
@joefromchicago,
Hey Joe, whatever helps you understand the differences and thank you for restating what I have already said.
@parados,
Parados, But we do pay federal sales tax in the form of customs and excise taxes.
@H2O MAN,
But that still leaves unanswered my initial question: why is the "fair" tax more
fair than the flat tax? It can't be because the flat tax still leaves state sales taxes in place, because the "fair" tax still leaves state income taxes in place, so that's a wash. Or are you saying that the "fair" tax will replace
all income taxes, state and federal alike?
@joefromchicago,
joefromchicago wrote:
But that still leaves unanswered my initial question: why is the "fair" tax more fair than the flat tax? It can't be because the flat tax still leaves state sales taxes in place, because the "fair" tax still leaves state income taxes in place, so that's a wash. Or are you saying that the "fair" tax will replace all income taxes, state and federal alike?
The fair tax only deals with federal taxes. Sates will still have their own taxation systems.
The FairTax: Fundamentals and facts
Quote:What is the FairTax Plan?
The FairTax Plan is a comprehensive proposal that replaces all federal income and payroll based taxes with an
integrated approach including a progressive national retail sales tax, a prebate to ensure no American pays federal
taxes on spending up to the poverty level, dollar-for-dollar federal revenue replacement, and, through companion
legislation, the repeal of the 16th Amendment. This nonpartisan legislation (HR 25/S 1025) abolishes all federal
personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and
self-employment taxes and replaces them with one simple, visible, federal retail sales tax " administered primarily
by existing state sales tax authorities. The IRS is disbanded and defunded. The FairTax taxes us only on what we
choose to spend on new goods or services, not on what we earn. The FairTax is a fair, efficient, transparent, and
intelligent solution to the frustration and inequity of our current tax system.
