Re: The Presidential Candidates on Taxes

George Z. Bush wrote:
John Galt wrote:
"mg" <mgkelson@xxxxxxxxx> wrote in message
news:1187605797.958742.255930@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
On Aug 18, 10:05 pm, chatnoir <wolfbat3...@xxxxxxxxxxxxxx> wrote:
http://www.ctj.org/

. . .
National Sales Tax

A proposal that anti-tax radicals call a "Fair Tax" is basically a
national sales tax that replaces all other federal taxes. It's
misleadingly described as a federal sales tax of 23 percent, and
former Arkansas Governor Mike Huckabee claimed at a May 15 debate that
the transition to this tax would be revenue-neutral. CTJ studied the
idea of a national sales tax in 2004 and found that in order to
maintain current revenue levels, this sales tax would have to be
around 50 percent. It is also very regressive. Low-income households
would pay more for everything they buy, while the wealthy would hit
the jackpot with tax-free capital gains, dividends and interest. We
are fairly confident that this proposal will go nowhere when people
realize that a house that costs, say, $200,000 would cost $300,000
under this plan.

Republican candidates Duncan Hunter, Tom Tancredo, Ron Paul, Mike
Huckabee, and even John McCain have expressed support for the "Fair
Tax" proposal. Former Senator Mike Gravel seems to be the only
Democratic candidate in favor of this notion, and has claimed that a
national sales tax would even solve global warming.
. . .

The Republicans claim the rate would be 23%. The CTJ finds that the
tax rate would actually have to be between 45 and 53 percent.
http://www.ctj.org/html/tjd78.htm
http://www.itepnet.org/sale0904.pdf

Everyone knows politicians are liars and for some perverted reason
I've never understood we Americans seem to take pride in that fact.
Even so, the lying has now gone from the sublime to the ridiculous.
Republicans are raising it to an art form.
I don't see it. You can go on the Fair Tax website and look at the math and
see how they got to the 23%. I've been studying this issues since *** Armey
proposed it in the mid 90's, and the math has *always* shown a taxation rate
in the low 20's (although its quite possible that this has risen to the high
20's, considering the increase in the size of government over the last few
years.

You want me to believe that the folks who absolutely assured us that they knew precisely where those Weapons of Mass Destruction were located four years ago (which we still haven't found) are telling us the truth about the Flat Tax (or anything else for that matter) and I have a problem with that. I have a huge problem with that. How can anyone believe that people who function as supporters or surrogates of a government which has operated on the basis of the public has no need to know much of anything is being honest and straighforward about anything they say?

AFAIAC, the Flat Tax is a boondoggle designed by rich people to help them retain and increase their wealth at the expense of everybody else. You don't have to be a fiscal genius to figure out that the poor and middle classes will be taxed for goods and services they've received tax-free in the past while, at the same time, rich folks who have been paying taxes not levied on the lesser folks will be relieved of that responsibility. Those rich folks claim that those taxes have been a burden to them but they won't acknowledge that, if it is, it's only because they can bear it far more than their less fortunate taxpayer brethren can without it interfering notably in their life styles.

As for the argument that the existing structure has held our economy and our nation down, record making and record breaking incomes have been created for our economically ambitious and capable people in spite of it. It hasn't, for example, held down those obscene profits the US oil industry has recently posted in spite of the ever-rising cost of crude oil.

The whole argument about the richer upper classes being able to grow the economy better with that type of tax structure is belied by the actual experience during the Reagan years, when trickle-down economics was proven to be an illusory goal rather than a realistic contribution to the nation's economy.
The linked document does not demonstrate very good mathematics, and does not
seem to be intended to. I can certainly see how the tax is actually 30%, but
the original sales tax proposals, left SS and Medicare taxes in place. Back
those out, and you're right back into the low 20;s.

However, it's important to stick to the important point here. The current
system of taxation is anti-growth. It costs too much to comply with, and
that money is better spent on employees, R&D, or pretty much anything other
than accountants. Plus, since businesses don't know from year to year what
the goverment with come up with, planning is impacted. Not good.

If you want to have a progressive scale of tax brackets, that's fine, but
make the tax system flat within those brackets.

I know that I'm probably displaying my ignorance, but I thought that under a Flat Tax, everybody pays the same rate of taxes. Maybe I don't understand what a tax bracket is as opposed to a tax rate, John. Could you clarify that for me, please? I'd appreciate it.

George Z.


Ever wonder why in any of these schemes that certain financial transactions are exempt from taxation? On the flat tax, somehow "unearned income" is exempt and can be used by the wealthy to accumulate more wealth unhandicapped by the pesky tax man. On the national sales tax, somehow purchase of equities is exempt. I pay sales tax on the purchase of just about everything except the purchase of shares in a company. How does anyone buy into that as "fair?"
.

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