Fair to everyone....except the poor, the middle class, those on fixed incomes, etc. etc. etc. etc. etc.
There are some good ideas, but there are a lot of flaws too. IM not a fan of the current tax system, but this isn't much better despite its simplicity. This hurts families and people have have multiple dependents. People like me who have no kids, low expense on goods and lots of investment get the most out of it. Walmart wont allow it, and it will hurt peoples ability to afford things which could hurt the retail economy.
actually, some of the strongest proponents of Fair Tax are those who represent the poor. from the FAQ section: Under the FairTax plan, poor people pay no net FairTax at all up to the poverty level! Every household receives a rebate that is equal to the FairTax paid on essential goods and services, and wage earners are no longer subject to the most regressive and burdensome tax of all, the payroll tax. Those spending at twice the poverty level will pay a tax of only 11.5 percent – a rate much lower than the income and payroll tax burden they bear today. Let’s look at a billionaire under the FairTax – if he spends $10,000,000 dollars he pays a tax of $2,300,000 and gets a rebate of $4,283 (assuming he is married and has no children). His effective tax rate is 22.96 percent. Now, let’s look at a middle-income married couple, under the FairTax, with no children – if they spend $40,000, they pay $4,917 net of their rebate for an effective tax rate of 12.3 percent. The effective tax rate increases as spending increases, but never exceeds 23 percent! I'm not advocating for it...but some of the more compelling arguments I've heard for this are from liberals who think it would be far better for the poor.
wait...Walmart is a HUGE employer...they wouldn't allow it? to the extent Walmart is paying taxes right now, we're paying those taxes for them...all costs are passed along.
http://www.fairtax.org/ Simply put, the FairTax replaces the way we're currently taxed - based on our annual income - with a tax on goods and services. The FairTax is a voluntary “consumption" tax: the more you buy, the more you pay in taxes, the less you buy, the less you pay in taxes. It's simple. Everyone pays their fair share of taxes, and with the FairTax rebate, spending up to the poverty level is tax free. The Federal government is fully funded, including Social Security and Medicare, and you don't need an expert to determine your Federal taxes. It's simple. National Sales Tax or a VAT? It is not clear. Edit: from their FAQ What is taxed? The FairTax is a single-rate, federal sales tax collected only once, at the final point of purchase of new goods and services for personal consumption. Used items are not taxed. Business-to-business purchases for the production of goods and services are not taxed. Time to self incorporate!!! The Corporation of ME needs food, shelter, a luxury auto befitting my new incorporation status, etc.
If you want the right behind real tax reform, all you would have to do is have a segment on talk radio evertday called "Today in the IRC". In the segment, they read a section of the tax code or regs. For example: "Today in the IRC". Our section today is 1017, a supplement to yesterdays reading of Section 108. Enjoy. § 1017. Discharge of indebtedness. (a) General rule. If-- (1) an amount is excluded from gross income under subsection (a) of section 108 [26 USCS § 108] (relating to discharge of indebtedness), and (2) under subsection (b)(2)(E), (b)(5), or (c)(1) of section 108 [26 USCS § 108], any portion of such amount is to be applied to reduce basis, then such portion shall be applied in reduction of the basis of any property held by the taxpayer at the beginning of the taxable year following the taxable year in which the discharge occurs. (b) Amount and properties determined under regulations. (1) In general. The amount of reduction to be applied under subsection (a) (not in excess of the portion referred to in subsection (a)), and the particular properties the bases of which are to be reduced, shall be determined under regulations prescribed by the Secretary. (2) Limitation in title 11 case or insolvency. In the case of a discharge to which subparagraph (A) or (B) of section 108(a)(1) [26 USCS § 108(a)(1)] applies, the reduction in basis under subsection (a) of this section shall not exceed the excess of-- (A) the aggregate of the bases of the property held by the taxpayer immediately after the discharge, over (B) the aggregate of the liabilities of the taxpayer immediately after the discharge. The preceding sentence shall not apply to any reduction in basis by reason of an election under section 108(b)(5) [26 USCS § 108(b)(5)]. (3) Certain reductions may only be made in the basis of depreciable property. (A) In general. Any amount which under subsection (b)(5) or (c)(1) of section 108 [26 USCS § 108] is to be applied to reduce basis shall be applied only to reduce the basis of depreciable property held by the taxpayer. (B) Depreciable property. For purposes of this section, the term "depreciable property" means any property of a character subject to the allowance for depreciation, but only if a basis reduction under subsection (a) will reduce the amount of depreciation or amortization which otherwise would be allowable for the period immediately following such reduction. (C) Special rule for partnership interests. For purposes of this section, any interest of a partner in a partnership shall be treated as depreciable property to the extent of such partner's proportionate interest in the depreciable property held by such partnership. The preceding sentence shall apply only if there is a corresponding reduction in the partnership's basis in depreciable property with respect to such partner. (D) Special rule in case of affiliated group. For purposes of this section, if-- (i) a corporation holds stock in another corporation (hereinafter in this subparagraph referred to as the "subsidiary"), and (ii) such corporations are members of the same affiliated group which file a consolidated return under section 1501 [26 USCS § 1501] for the taxable year in which the discharge occurs, then such stock shall be treated as depreciable property to the extent that such subsidiary consents to a corresponding reduction in the basis of its depreciable property. (E) Election to treat certain inventory as depreciable property. (i) In general. At the election of the taxpayer, for purposes of this section, the term "depreciable property" includes any real property which is described in section 1221(a)(1) [26 USCS § 1221(a)(1)]. (ii) Election. An election under clause (i) shall be made on the taxpayer's return for the taxable year in which the discharge occurs or at such other time as may be permitted in regulations prescribed by the Secretary. Such an election, once made, may be revoked only with the consent of the Secretary. (F) Special rules for qualified real property business indebtedness. In the case of any amount which under section 108(c)(1) [26 USCS § 108(c)(1)] is to be applied to reduce basis-- (i) depreciable property shall only include depreciable real property for purposes of subparagraphs (A) and (C), (ii) subparagraph (E) shall not apply, and (iii) in the case of property taken into account under section 108(c)(2)(B) [26 USCS § 108(c)(2)(B)], the reduction with respect to such property shall be made as of the time immediately before disposition if earlier than the time under subsection (a). (4) Special rules for qualified farm indebtedness. (A) In general. Any amount which under subsection (b)(2)(E) of section 108 [26 USCS § 108] is to be applied to reduce basis and which is attributable to an amount excluded under subsection (a)(1)(C) of section 108 [26 USCS § 108]-- (i) shall be applied only to reduce the basis of qualified property held by the taxpayer, and (ii) shall be applied to reduce the basis of qualified property in the following order: (I) First the basis of qualified property which is depreciable property. (II) Second the basis of qualified property which is land used or held for use in the trade or business of farming. (III) Then the basis of other qualified property. (B) Qualified property. For purposes of this paragraph, the term "qualified property" has the meaning given to such term by section 108(g)(3)(C) [26 USCS § 108(g)(3)(C)]. (C) Certain rules made applicable. Rules similar to the rules of subparagraphs (C), (D), and (E) of paragraph (3) shall apply for purposes of this paragraph and section 108(g) [26 USCS § 108(g)]. (c) Special rules. (1) Reduction not to be made in exempt property. In the case of an amount excluded from gross income under section 108(a)(1)(A) [26 USCS § 108(a)(1)(A)], no reduction in basis shall be made under this section in the basis of property which the debtor treats as exempt property under section 522 of title 11 of the United States Code. (2) Reductions in basis not treated as dispositions. For purposes of this title, a reduction in basis under this section shall not be treated as a disposition. (d) Recapture of reductions. (1) In general. For purposes of sections 1245 and 1250 [26 USCS §§ 1245 and 1250]-- (A) any property the basis of which is reduced under this section and which is neither section 1245 property nor section 1250 property shall be treated as section 1245 property, and (B) any reduction under this section shall be treated as a deduction allowed for depreciation. (2) Special rule for section 1250. For purposes of section 1250(b) [26 USCS § 1250(b)], the determination of what would have been the depreciation adjustments under the straight line method shall be made as if there had been no reduction under this section.
I like consumption taxes. People who make more, spend more and pay more. Someone who buys clothes at Walmart will pay less taxes then someone who shops at Sachs because there clothers are cheaper. There are exemptions per person per year for the amount you need to live. Currently wealthy people have more options to hide their money in tax shelters that poor to middle class people can't afford to do, but with a consumption tax the wealty pay as they buy. I like it!!!
