Text 12987, 74 rader
Skriven 2005-05-27 16:54:36 av EARL CROASMUN (1:275/311)
     Kommentar till en text av JOHN MASSEY
Ärende: Fair Tax
================
JM> # How does the rebate work? All valid Social Security cardholders
who are U.S. residents receive a monthly rebate equivalent to the
FairTax paid on essential goods and services, also known as the poverty
level expenditures. The rebate is paid in advance, in equal installments
each month. The size of the rebate is determined by the Department of
Health & Human Services' poverty level multiplied by the tax rate. This
is a well-accepted, long-used poverty-level calculation that includes
food, clothing, shelter, transportation, medical care, etc.

 - - -

An interesting twist.  It sounds like this is a rebate of what they are
ASSUMED to have paid, rather than a requirement that they save all their
receipts and apply for a rebate of what they ACTUALLY paid in sales tax.
EVERY PERSON with a SSN gets a government check EVERY MONTH, as a
guaranteed income?  A one year old gets the same as the head of the
household?  Sounds sorta like George McGovern's idea of giving every
citizen a check for a thousand dollars (back when that was a lot of
mnoney, before Carter-flation).  But it does make the tax less
regressive, which was my earlier point.



 >But the biggest problem with
 EC> it being utopian is that it wouldn't happen.  Congress wouldn't make the
 EC> big jump into the unknown.  Everyone who profits (or who thinks they
 EC> profit) from the present tax structure would be running ads, lobbying,
 EC> and bribing to block the legislation.  IF there were enough of a
 EC> grassroots movement behind it, the idea would wind up being coopted into
 EC> having a federal sales tax ON TOP OF the income tax.

-> The Fair Tax Plan sponsored by John Lender and Fairtax.org  is incumbent on
-> repelling  the 16 amendment.

Without a doubt, the tax system should be reformed, simplified,
streamlined, and hopefully with lower marginal rates.  Reagan started
the process in 1981-84 and in 1986.  But since then it has just gotten
worse.  Everyone wants to twist the tax code to get people to do what
they want them to do.  Tax credits get piled on top of tax credits, and
everyone in Washington wants to "target" them in specific ways.  For a
while there was some political momentum behind the "flat tax" idea.  It
was even popular enough to make a clown like Forbes look like a serious
Presidential candidate for a few months.  One of the things that took
the wind out of the tax reform sails at that time was an internal split
within the reform camp.  Some people wanted a national consumption tax,
while others wanted a flat tax.  I don't see the sales tax happening, at
least not in the whole-hog approach you are talking about, which makes
it a diversion from more practical and do-able reforms.

I don't know if anyone ever wrote a decent history of the flat tax idea,
but if so it would have some interesting lessons for advocates of a
sales tax.  For instance, at first the purists were pushing for a
perfectly flat tax rate on all income above the poverty level, with no
other tax credits or deductions.  Problem is, the tax code is filled
with hidden subsidies of things disguised as tax deductions or credits.
Every person who gets one of those deductions will see its elimination
as an expense to them.  As I recall the biggest stink came over the
prospect of elimination of the mortgage interest deduction.  Every
person who owns a house and hasn't paid it off will think you are taking
money out of their pockets, because they factored the deduction into
their long-range plans.  A good economist can answer their arguments,
but most people won't listen to economists.  The net result is that
advocates of this sales tax idea will get hit with waves of TV ads that
will make the attacks on the Clinton "health care reform" plan look
really minor by comparison.  The advantage of a flat tax idea is that it
can be done in incremental steps -- such as eliminating some deductions
while keeping others.  You can eliminate the solar energy subsidy, for
example, while keeping the mortgage subsidy.  But eliminating the whole
income tax for a sales tax means facing all of the political flack at
once, unless extra "rebates" were cut to replace the existing tax
deductions and credits.

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