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A Popular myth about the so called Fair Tax!

 
 
Reply Fri 22 Jul, 2005 05:47 pm
HEARTLAND INSTITUTE, article titled:Economists Back 'Fair Tax' Proposal

MYTH:

“The Fair Tax would replace federal personal, gift, estate, capital gains, alternative minimum, earned income, Social Security/Medicare, self-employment, and corporate taxes with a national sales tax. . . . . [/i]

TRUTH:

The proposed Fair Tax cannot guarantee even one of the above stated attractions because the proposed legislation, H.R.25, and, S.1493 even if adopted by a current Congress, and signed into law by the President, is nothing more that a list of suggestions to all future Congresses and would not bind any future Congress. Future Congresses would be free to tinker with the original proposal and manipulate it to accommodate the politically influential just as is now done with the current system.

Contrary to the myth of what the Fair Tax alleges it will do, which is squat, one way to achieve its above stated goals is by a constitutional amendment stating The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay “any” tax or burden calculated from profits, gains, interest, salaries, wages, tips, or any other lawfully realized money.

If adopted, such an amendment would in fact not only bring us back to our founding fathers original tax plan and accomplish the proposed featured attractions of H.R. 25, but in addition, would precluded Congress from using its excise taxing power in the future, as described in FLINT v. STONE TRACY CO., 220 U.S. 107 (1911) which permits Congress to calculate taxes from profits and gains, and does so without reliance upon the 16th Amendment!.

The SCOTUS in the Flint Case stated:

“The tax under consideration, as we have construed the statute, [Corporate tax Act of 1909] may be described as an excise upon the particular privilege of doing business in a corporate capacity, i. e., with the advantages which arise from corporate or quasi corporate organization; or, when applied to insurance companies, for doing the business of such companies. As was said in the Thomas Case, 192 U. S. supra, the requirement to pay such taxes involves the exercise of [220 U.S. 107, 152] privileges, and the element of absolute and unavoidable demand is lacking. If business is not done in the manner described in the statute, no tax is payable.” . . . ” In other words, the tax is imposed upon the doing of business of the character described, and the measure of the tax is to be income, with the deduction stated, received not only from property used in business, but from every source."

So, although the tax is not imposed upon “income” and is imposed upon the “privilege“, and then the amount of tax paid is calculated from profits and gains___ it quacks like an income tax, looks like an income tax, and reasonable people would all agree it is an income tax!

By adding to our Constitution, The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay “any” tax or burden calculated from profits, gains, interest, salaries, wages, tips, or any other lawfully realized money rather than the meaningless wording contained in H.R. 25, the stated objects of H.R. 25 are achieved and working people as well as business and industry, will no longer suffer under the burdens of income taxation…no more income tax paper work, no more filing income tax returns under the penalty of perjury, no more income tax audits, no more manipulation of an “income” tax system which favors one class over another, and, the ability of folks in government to use the income tax system as a weapon against political enemies is removed!

As Thomas Jefferson warned us "In matters of Power, let no more be heard of confidence in men, but bind him down from mischief by the chains of the Constitution"? Put the wording in the Constitution!

Those who are sincere in wanting real tax reform, ought to be promoting a return to our founding fathers original tax plan, as described above, which helped to make America the economic marvel of the world, and also helped to control the actions of Congress!

For an outline of the Founding Father’s original tax plan CLICK HERE and scroll down to :

American Constitutional Research Service Before the
Committee on Ways and Means
United States House of Representatives
June 1995


Mr. Chairman and Members of this Committee:

ANOTHER POPULAR MYTH ABOUT THE SO CALLED FAIR TAX

NEAL BOORTZ wrote in an article titled ANSWERING A FAIR TAX QUESTION:

MYTH

“It doesn't matter that paying taxes will be voluntary under the Fair Tax plan. It doesn't matter that nobody pays the retail sales tax on the basic necessities of life.”[/b]

TRUTH

All consumers pay the tax on the basic necessities of life under the so called fair tax. What Neal is referring to when he claims nobody pays tax on the basic necessities of life is the plan’s concocted “family consumption allowance“, a politically dangerous part of the proposal which is a monthly check given to each American household by government to offset taxes paid on the basic necessities of life by the household’s members.

What the fair tax proposal promises to do is give Senator Ted Kennedy a very valuable gift called the family consumption carrot, which he, and his socialist disciples in Congress will promise to increase during election time to buy millions of votes to remain in power, just as these socialists now do with the minimum wage, social security payments, aid to families with dependant children, and even corporate welfare___ the only difference is, the family consumption allowance promises to extend the tentacles of socialism to every American household in America with a monthly government subsistence check, completing the socialist takeover of America!

As to the Boortz assertion that “It doesn't matter that paying taxes will be voluntary under the Fair Tax plan“[/i], such a statement would in fact be unassailable if, and only if, the necessities of life and supplies necessary to conduct business were not taxed under the Fair Tax plan. But they are taxed, and to conclude as Neal Boortz does, one must pretend that starving one’s self to death and the shutting down of America’s businesses and industries is a rational approach for Americans who wish to avoid paying the “voluntary” tax on the necessities of life and supplies necessary to conduct America’s businesses. And so, we list this assertion of Neal’s in the MYTH column where it rightfully belongs.


Be cautious before lending your support for the so called fair tax, for there are domestic enemies and fools among us. I suggest those who are interested in learning some of the adverse effects of the fair tax proposal study: The Fair Tax: A Trojan Horse For America

For an outline of the Founding Father’s original tax plan, which we ought to return to and was designed for a freedom loving nation CLICK HERE and scroll down to :

American Constitutional Research Service Before the
Committee on Ways and Means
United States House of Representatives
June 1995

For some pro and con points of view concerning the fair tax see: [/u]RESPONSES TO FAIR TAX ARTICLE[/u]

Regards,
JWK


"...a national revenue must be obtained; but the system must be such a one, that, while it secures the object of revenue it shall not be oppressive to our constituents." Madison, during the creation of our nation’s FIRST REVENUE RAISING ACT

Regards,

JWK
ACRS

___ with all these blessings, what more is necessary to make us a happy and a prosperous people? Still one thing more, fellow-citizens—a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government, and this is necessary to close the circle of our felicities__ Thomas Jefferson, First Inaugural Address
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