Text 849, 148 rader
Skriven 2006-06-04 14:10:00 av BOB KLAHN (1:123/140)
     Kommentar till en text av JOHN MASSEY
Ärende: Fairtax part 2
======================
 ...

 JM> Since you claim that Fairtax.org didn't respond directly to
 JM> your favorite flat tax plan here are some basic issues that
 JM> makes all flat tax plans inferior to the Fair Tax

 Your mistake. As to income tax, I do not have a favorite flat
 tax plan. I think they all stink.

 JM> 1. In 1986 the Congress reformed our tax code to
 JM> essentially give us a flat tax ... a flat tax with two
 JM> rates.  Fifteen and twenty-eight percent.  Most deductions
 JM> were eliminated.  Today's tax code is the result of that
 JM> effort. The 1986 tax reform has been amended over 10,000
 JM> times

 Amended, or amendments proposed? And where did you get that
 from? I find it hard to imagine you counting all 10,000
 amendments.

 JM> 2. A flat tax leaves the IRS in place.  You'll still have
 JM> to report your income to the IRS every year, and you'll
 JM> still be subject to audits.

 Which is irrelevant to the value of a flat vs sales tax. Only
 relevant to the anti-gov fanatics.

 JM> 3. Social Security and Medicare payroll taxes?  Still there.

 Social Security and Medicare taxes *ARE* flat taxes, with a
 reverse exemption, at the high end instead of the low end. I
 favor putting both on a VAT. I came up with that idea long ago.

 JM> 4. Do you get 100% of your paycheck?  No.  Withholding will
 JM> still be there.

 BFD. You don't get to keep it, so why is withholding worse than
 paying it out of pocket? Other than reduced possibility of tax
 evasion, that is.

 JM> 5 Business taxes?  Still there .. and they'll remain
 JM> embedded in the price of every good and service you buy, so
 JM> you'll be paying them.

 The fairtax proposal I saw did not remove all business taxes,
 just income and payroll. It shouldn't remove them all either.
 Why shouldn't business pay for functions that serve those
 businesses?

 JM> 6 Corporate board meetings?  They'll still spend an
 JM> inordinate amount of time working on the tax implications
 JM> of business decisions, rather than just basing their
 JM> business moves on what's best for their customers and
 JM> shareholders.

 That's their failure, not inherent in any tax. Instead the tax
 evasion will take place at the retail end instead of the board
 level.

 JM> 7. K Street lobbyists?  They're still there too.  They'll
 JM> still be drawing their six-figure incomes while they game
 JM> the new flat-tax for the benefit of their clients.

 K Stree lobbyists will be there as long as republicans control
 the govt. Esp now that the republican party controls the
 K-street lobbyists.

 JM> 8. Bring American businesses back home?  Nope.  Business
 JM> taxes are still there, so American  businesses will still
 JM> locate their operations overseas in order to escape our
 JM> punishing business income taxes.

 Businesses don't locate their operations overseas to avoid
 business taxes, they just open an office from a PO Box and evade
 the taxes. The simple solution is, tax any business conducted in
 the US under US law, on the principle that, if you do your
 business here, you pay your taxes here. Assume all costs are
 incurred in this country and tax appropriately.

 JM> 9. Death Tax?  Gift Tax?  Still there in all the flat tax
 JM> proposals I've seen.

 Estate tax and gift tax. And they should be. It's income, it
 should be taxed.

 JM> 10. Will the flat tax bring American wealth back home?  The
 JM> latest estimates put $10 trillion of American wealth in
 JM> offshore financial corporations. There is only one reason
 JM> that money isn't back here working ... and that's our
 JM> income tax structure.  Will the flat tax bring that money
 JM> back home? Nope.  The FairTax?  Yup.

 Wrong on all counts. There is very little any income tax
 program you have come up with will do to bring that money home
 against overseas wage rates where the daily, or even weekly rate
 equals or is less than the hourly rate in this country. Nothing
 that doesn't turn the US into a third world country anyway.

 Now putting a payroll tax on a VAT will help that. But that's
 another subject.

 JM> 11. What about the poor?  They're not paying income taxes
 JM> now ... will they pay the flat tax?  No way!  But

 Well, yes they will. The poor are not only those under the
 poverty level. People well above the poverty level are still
 poor.

 There is a distinction. And the flat tax proposals I have heard
 of include a deduction for the first x amount of money, up to th
 $30K level. Just looked it up, the Armey proposal has a $36,800
 exemption for a family of four.

 JM> politicians will still be looking for a way to raise taxes
 JM> on the rich so that they can relieve the poor, poor pitiful
 JM> poor of the responsibility for paying for their own Social
 JM> Security and Medicare.

 And your "fairtax" will turn social security into a pure welfare
 program for the poor. Since most poor in this country are
 working poor, they are paying social security, which means they
 are buying into the system.

 IOW, what you just complained about will happen under your
 fairtax.

 JM> 12. Will all Americans be able to buy the basic necessities
 JM> of life without any federal tax consequences under the flat
 JM> tax?  No.  The FairTax?  Yes.

 Nothing you have said makes that inherent in either plan. It's
 written into your fairtax, but a similar deduction has been
 incorporated into the flat tax plans, as above.

 JM> 13. Will foreign visitors to our shores contribute to our
 JM> Social Security and Medicare programs under the flat tax?
 JM> No.  The FairTax?  Yes.

 They will under a VAT. But that's another story.

 BTW, why would you expect them to?

BOB KLAHN bob.klahn@sev.org   http://home.toltbbs.com/bobklahn

... You shall know the truth, and the truth shall make you free.
 * Silver Xpress V4.5/P [Reg]
--- Platinum Xpress/Win/WINServer v3.0pr5
 * Origin: Try Our Web Based QWK: DOCSPLACE.ORG (1:123/140)