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A federal sales tax?

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I'm Supposn

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A federal sales tax?

“Fair Tax” proponents generally propose transfer of our major federal tax revenue sources should be accomplished within a single year, if not upon a single date. I do not believe the U.S. Congress would or should ever be so imprudent. those fair tax proponents are insisting that their proposal should never be passed, and enacted.

Providing the legislation is drafted to keep their promise to grant sufficient compensating consideration for the poor, I perceive real net economic benefits to be derived if we incrementally enact replacing all or any portion of taxes upon incomes with a sales tax. Incremental enactment is the superior and the most prudent enactment for this application.

Each incremental enacting step should simultaneously increase the sales tax, reduce taxes upon incomes and grant additional compensating consideration to mitigate the additional sales taxes impact upon the poor; those compensating provisions need not be limited to tax provisions.
The consequential revenues realized after each incremental step will better guide reconciliation for the next step’s scheduled tax modifications.


The initial enactment step will enact the sales tax and eliminate the portions of FICA taxes (which are funded by both employees and employers) that do not fund the ordinary Social Security retirement program, (eliminating FICA funding for such programs as Supplemental Security Income (SSI) and disability insurance benefits). Within that same initial or the next step, half of FICA's remaining tax rate (that’s paid by both employees and employers), should also be eliminated.

FICA is our most regressive federal tax. It’s proportionally a greater burden upon the working poor. (Retaining a portion of the payroll tax that funds social security retirement benefits also retains a portion of the program’s insurance concept).
Before any of the new federal sales tax contributes to our general tax revenues, I advocate Congress “ear-mark” specific portions of the sales tax rate for the funding of specific social programs. This would be a continuous reminder of each of those programs costs to individual sales transactions and eliminate repeating the canard that the poor don’t pay taxes. This lie’s particularly untrue regarding the working-poor.

Individuals and their dependents’ incomes are (proportionally to their actual incomes), more accurately reflected by their aggregate purchasing transactions rather than by the tax forms they submit for the purposes of reporting their incomes. Costs due to tax evasions, compliance, administration, and enforcement are less for general flat rated taxes based upon gross sales rather than taxes upon net incomes.

I believe a federal sales tax rate to entirely replace USA’s tax revenues derived from taxes upon enterprises' and individuals'net incomes and payrolls would be politically unacceptable and economically less than feasible). If incremental enactment were to begin, I believe after one of the incremental steps the congress would recognize this and interrupt sales tax increases.

If I’m incorrect, sales tax would entirely replace federal taxes based upon net incomes.

Replacing any portion or all portions of our taxes upon net incomes with a sales tax would be net beneficial to our economy.
Respetfully, Supposn

 
I'm Supposn said:
A federal sales tax?

“Fair Tax” proponents generally propose transfer of our major federal tax revenue sources should be accomplished within a single year, if not upon a single date. I do not believe the U.S. Congress would or should ever be so imprudent. those fair tax proponents are insisting that their proposal should never be passed, and enacted.

Providing the legislation is drafted to keep their promise to grant sufficient compensating consideration for the poor, I perceive real net economic benefits to be derived if we incrementally enact replacing all or any portion of taxes upon incomes with a sales tax. Incremental enactment is the superior and the most prudent enactment for this application.

Each incremental enacting step should simultaneously increase the sales tax, reduce taxes upon incomes and grant additional compensating consideration to mitigate the additional sales taxes impact upon the poor; those compensating provisions need not be limited to tax provisions.
The consequential revenues realized after each incremental step will better guide reconciliation for the next step’s scheduled tax modifications.


The initial enactment step will enact the sales tax and eliminate the portions of FICA taxes (which are funded by both employees and employers) that do not fund the ordinary Social Security retirement program, (eliminating FICA funding for such programs as Supplemental Security Income (SSI) and disability insurance benefits). Within that same initial or the next step, half of FICA's remaining tax rate (that’s paid by both employees and employers), should also be eliminated.

FICA is our most regressive federal tax. It’s proportionally a greater burden upon the working poor. (Retaining a portion of the payroll tax that funds social security retirement benefits also retains a portion of the program’s insurance concept).
Before any of the new federal sales tax contributes to our general tax revenues, I advocate Congress “ear-mark” specific portions of the sales tax rate for the funding of specific social programs. This would be a continuous reminder of each of those programs costs to individual sales transactions and eliminate repeating the canard that the poor don’t pay taxes. This lie’s particularly untrue regarding the working-poor.

Individuals and their dependents’ incomes are (proportionally to their actual incomes), more accurately reflected by their aggregate purchasing transactions rather than by the tax forms they submit for the purposes of reporting their incomes. Costs due to tax evasions, compliance, administration, and enforcement are less for general flat rated taxes based upon gross sales rather than taxes upon net incomes.

I believe a federal sales tax rate to entirely replace USA’s tax revenues derived from taxes upon enterprises' and individuals'net incomes and payrolls would be politically unacceptable and economically less than feasible). If incremental enactment were to begin, I believe after one of the incremental steps the congress would recognize this and interrupt sales tax increases.

If I’m incorrect, sales tax would entirely replace federal taxes based upon net incomes.

Replacing any portion or all portions of our taxes upon net incomes with a sales tax would be net beneficial to our economy.
Respetfully, Supposn
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Lets think out side the box for a moment. Most states that have a sales tax ALSO have an income tax. Probably a bad idea to have the two concurrent because lets face it neither will go the way of the dodo bird. There will almost always be some excuse to not get rid of one of the forms of taxation. In order to change from one type of taxation to another you HAVE to go cold turkey, otherwise no tax goes away and you just get taxed more.

The best tax there is that is the least regressive and captures the most money with the least attempts at fraud is a transaction tax at less than a percent rate. It hits everyone but hits those with the most money the most. Rich people tend to move money, a lot of money, a lot of times. A transaction tax will hit them the hardest while at the same time making sure EVERYONE has skin in the game but are equally impacted. It impacts the FLOW of money, its velocity if you will. That means its in the governments interests that the money flow is as maximum capacities, which is good for you and I, because the more we make the better off we are.
 
I'm Supposn said:
A federal sales tax?

“Fair Tax” proponents generally propose transfer of our major federal tax revenue sources should be accomplished within a single year, if not upon a single date. I do not believe the U.S. Congress would or should ever be so imprudent. those fair tax proponents are insisting that their proposal should never be passed, and enacted.

Providing the legislation is drafted to keep their promise to grant sufficient compensating consideration for the poor, I perceive real net economic benefits to be derived if we incrementally enact replacing all or any portion of taxes upon incomes with a sales tax. Incremental enactment is the superior and the most prudent enactment for this application.

Each incremental enacting step should simultaneously increase the sales tax, reduce taxes upon incomes and grant additional compensating consideration to mitigate the additional sales taxes impact upon the poor; those compensating provisions need not be limited to tax provisions.
The consequential revenues realized after each incremental step will better guide reconciliation for the next step’s scheduled tax modifications.


The initial enactment step will enact the sales tax and eliminate the portions of FICA taxes (which are funded by both employees and employers) that do not fund the ordinary Social Security retirement program, (eliminating FICA funding for such programs as Supplemental Security Income (SSI) and disability insurance benefits). Within that same initial or the next step, half of FICA's remaining tax rate (that’s paid by both employees and employers), should also be eliminated.

FICA is our most regressive federal tax. It’s proportionally a greater burden upon the working poor. (Retaining a portion of the payroll tax that funds social security retirement benefits also retains a portion of the program’s insurance concept).
Before any of the new federal sales tax contributes to our general tax revenues, I advocate Congress “ear-mark” specific portions of the sales tax rate for the funding of specific social programs. This would be a continuous reminder of each of those programs costs to individual sales transactions and eliminate repeating the canard that the poor don’t pay taxes. This lie’s particularly untrue regarding the working-poor.

Individuals and their dependents’ incomes are (proportionally to their actual incomes), more accurately reflected by their aggregate purchasing transactions rather than by the tax forms they submit for the purposes of reporting their incomes. Costs due to tax evasions, compliance, administration, and enforcement are less for general flat rated taxes based upon gross sales rather than taxes upon net incomes.

I believe a federal sales tax rate to entirely replace USA’s tax revenues derived from taxes upon enterprises' and individuals'net incomes and payrolls would be politically unacceptable and economically less than feasible). If incremental enactment were to begin, I believe after one of the incremental steps the congress would recognize this and interrupt sales tax increases.

If I’m incorrect, sales tax would entirely replace federal taxes based upon net incomes.

Replacing any portion or all portions of our taxes upon net incomes with a sales tax would be net beneficial to our economy.
Respetfully, Supposn
Click to expand...

Penalizing spending in a consumer economy is dangerous business. I would support a "luxury tax" that applies to certain expensive items though. Like a 10% tax on cars over $150,000. Otherwise there is nothing more regressive and unfair than the "fair tax".
 
iguanaman said:
Penalizing spending in a consumer economy is dangerous business. I would support a "luxury tax" that applies to certain expensive items though. Like a 10% tax on cars over $150,000. Otherwise there is nothing more regressive and unfair than the "fair tax".
Click to expand...

Problem with luxury taxes is people can go elsewhere to get their luxuries. A transaction tax of less than a percent gives everyone skin in the game but the "impact" of the tax is relatively the same for everyone as people who have money tend to move it around. The idea of the tax is to make it such that avoiding it is pointless and it still captures the required revenue of the government with minimal instantaneous impact to everyone.
 
PirateMk1 said:
Problem with luxury taxes is people can go elsewhere to get their luxuries. A transaction tax of less than a percent gives everyone skin in the game but the "impact" of the tax is relatively the same for everyone as people who have money tend to move it around. The idea of the tax is to make it such that avoiding it is pointless and it still captures the required revenue of the government with minimal instantaneous impact to everyone.
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If you are paying for luxury goods you are not really going to care how much tax is on it. People who buy luxury goods will not go out their way to buy luxury goods just because it is 10% cheaper. Hell paying more is part of the appeal.
 
Carjosse said:
If you are paying for luxury goods you are not really going to care how much tax is on it.
Click to expand...
Of course you will.

Carjosse said:
People who buy luxury goods will not go out their way to buy luxury goods just because it is 10% cheaper.
Click to expand...
More likely, they'll spend the money on something else that isn't taxed to hell.

We tried this back in the 90's. It was a miserable failure.
 
Taylor said:
Of course you will.


More likely, they'll spend the money on something else that isn't taxed to hell.

We tried this back in the 90's. It was a miserable failure.
Click to expand...

Do you not understand how luxury goods work? Price and therefore taxes are a very insignificant part of a person's decision in purchasing the product. No one has ever decided against a Ferrari because it was $5,000 too expensive. No one has ever decided against buying a Coach handbag because it costs $200 more. If that was the case then explain how London and Paris with their 20% VAT taxes are by far two of the most important major locations for the luxury goods sector. If you care about how much tax you pay, you are not a luxury consumer.
 
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Carjosse said:
Do you not understand how luxury goods work? Price and therefore taxes are a very insignificant part of a person's decision in purchasing the product. No one has ever decided against a Ferrari because it was $5,000 too expensive. No one has ever decided against buying a Coach handbag because it costs $200 more. If that was the case then explain how London and Paris with their 20% VAT taxes are by far two of the most important major locations for the luxury goods sector. If you care about how much tax you pay, you are not a luxury consumer.
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People of that level of wealth can also choose to purchase items in places to avoid paying taxes. a coach bag can be bought in London while on Holiday and the person can simply claim they left the US with it if Customs asks. Luxury taxes cannot bring in enough revenue to even dent expenditures, and in practice they have never produced revenues. Mass used to have a high tax on yachts, guess what? If you owned a Marina in The great state of Rhode Island and Providence Plantations you would be pretty the day that law passed
 
Carjosse said:
If you are paying for luxury goods you are not really going to care how much tax is on it. People who buy luxury goods will not go out their way to buy luxury goods just because it is 10% cheaper. Hell paying more is part of the appeal.
Click to expand...

That's not true at all, in fact rich people actually are more likely To care about price level. like Donald Sterling would sit in pharmacies and negotiate viagra prices.

Ford and not Ferrari is the preferred make of vehicle amongst America's millionaires
 
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EMNofSeattle said:
That's not true at all, in fact rich people actually are more likely To care about price level. like Donald Sterling would sit in pharmacies and negotiate viagra prices.

Ford and not Ferrari is the preferred make of vehicle amongst America's millionaires
Click to expand...

That is in direct opposition to the very idea of luxury goods and their appeal. The only reason that luxury goods exist is for consumer's who buy them almost entirely regardless of price level. If what you were saying was true there would be no market for luxury goods like Ferrais, Rolexs, or MacBooks.
 
Carjosse said:
That is in direct opposition to the very idea of luxury goods and their appeal. The only reason that luxury goods exist is for consumer's who buy them almost entirely regardless of price level. If what you were saying was true there would be no market for luxury goods like Ferrais, Rolexs, or MacBooks.
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There is also a very limited market for those products. I would also not class a 1200 dollar computer as a luxury product. Furthermore many luxury products are financed with debt from middle level income makers. The ultra rich buy nicer toys, but with cash and negotiate prices as much as they can. You don't become rich by being taken advantage of.

What percentage of car sales do you think are ferraris? One it is fundemtnally immoral to charge legal businesses and consumers more in taxes then comparable industries, but second luxury taxes have been tried in this country and the only result was that retailers of the effected products laid off workers or closed.
 
Carjosse said:
If you are paying for luxury goods you are not really going to care how much tax is on it. People who buy luxury goods will not go out their way to buy luxury goods just because it is 10% cheaper. Hell paying more is part of the appeal.
Click to expand...

Unfortunately, that's a stereotype that is not correct, or even close to correct. Rich people didn't become rich by not caring what something costs. A 1% difference in cost will make a difference to a rich person. A 10% difference would probably stop the transaction all together.

Remember what happened when the government decided to go nuts with government spending after the collapse of '08? The rich folks sat on their money. Some bought real estate that had depressed in price, but for the most part, the flow of private capital stopped cold. Businesses didn't expand, or reinvest in machinery, or expand their footprint of factories, or hire anyone new. Then came the PPACA and those added costs made the folks with money sit on their cash even harder, and some even put their employees on 30 hour weeks.

To think that because a person has money, that they don't care about any fluctuations in the cost of money or the cost of goods or services, is naïve at best, and political ignorance of real economic dynamics at worst.
 
Carjosse said:
If you are paying for luxury goods you are not really going to care how much tax is on it. People who buy luxury goods will not go out their way to buy luxury goods just because it is 10% cheaper. Hell paying more is part of the appeal.
Click to expand...

Wrong the luxury tax has already been tried and it decimated the US boat industry and several others because when you put a luxury tax on a high end multi million dollar item it adds up quick. The rich can buy their items anywhere. If they can get more for the same dollar they will, even if its elsewhere. There was a reason it was repealed relatively quickly in the US. Boutiques high end items are built by skilled craftsman. They are the first to be hurt by luxury taxes.
 
iguanaman said:
Penalizing spending in a consumer economy is dangerous business. I would support a "luxury tax" that applies to certain expensive items though. Like a 10% tax on cars over $150,000. Otherwise there is nothing more regressive and unfair than the "fair tax".
Click to expand...

You obviously have no clue what you're talking about. The Fair Tax has a pre-bate that refunds all sales tax up to the spending equivalent of the poverty line (~12k). Everyone gets a check to cover that - up front, every year. Thus, no one pays the federal sales tax until they've spent 12k on new retail goods. Note: new retail goods. There is no federal sales tax on used goods whatsoever. A poor person could purchase no new retail goods and pocket the entire pre-bate as profit (~3k, cash in pocket).

Perhaps you should learn something about this. https://fairtax.org/
 
ecofarm said:
You obviously have no clue what you're talking about. The Fair Tax has a pre-bate that refunds all sales tax up to the spending equivalent of the poverty line (~12k). Everyone gets a check to cover that - up front, every year. Thus, no one pays the federal sales tax until they've spent 12k on new retail goods. Note: new retail goods. There is no federal sales tax on used goods whatsoever. A poor person could purchase no new retail goods and pocket the entire pre-bate as profit (~3k, cash in pocket).

Perhaps you should learn something about this. https://fairtax.org/
Click to expand...

LOL And a man like the Google CEO who makes $200 million pays less then 1% of his income in tax. What % would most of us pay, you know the ones that spend all they earn? 20 or 30%? How is that fair? Don't you even see the problem for the economy when you penalize the consumer? Consumer spending is 75% of our GDP. Do you really want people to stop buying things? That is called a recession BTW.
 
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iguanaman said:
LOL And a man like the Google CEO who makes $200 million pays less then 1% of his income in tax. How is that fair? Don't you even see the problem for the economy when you penalize the consumer? Consumer spending is 75% of our GDP do you really want people to stop buying things? That is called a recession BTW.
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Why is it not?
 
iguanaman said:
LOL And a man like the Google CEO who makes $200 million pays less then 1% of his income in tax. What % would most of us pay, you know the ones that spend all they earn? 20 or 30%? How is that fair? Don't you even see the problem for the economy when you penalize the consumer? Consumer spending is 75% of our GDP. Do you really want people to stop buying things? That is called a recession BTW.
Click to expand...

Used goods are not taxed. Poor people pay almost or nothing, rich people buy new retail goods.

At least get some education on the Fair Tax before randomly spewing against it. Plenty of Dem Reps co-sponsored the bill.
 
ecofarm said:
You obviously have no clue what you're talking about. The Fair Tax has a pre-bate that refunds all sales tax up to the spending equivalent of the poverty line (~12k). Everyone gets a check to cover that - up front, every year. Thus, no one pays the federal sales tax until they've spent 12k on new retail goods. Note: new retail goods. There is no federal sales tax on used goods whatsoever. A poor person could purchase no new retail goods and pocket the entire pre-bate as profit (~3k, cash in pocket).

Perhaps you should learn something about this. https://fairtax.org/
Click to expand...

Why complicate things. A transaction tax would be better much more progressive way to tax with much less inclination to cheat especially if its under a percent. Not to mention its simple and much easier to collect. Taxing the FLOW of money is much more consistent than what we have now and more importantly would give government the incentive to make sure the flow of money is maximized.
 
PirateMk1 said:
Why complicate things. A transaction tax would be better much more progressive way to tax with much less inclination to cheat especially if its under a percent. Not to mention its simple and much easier to collect. Taxing the FLOW of money is much more consistent than what we have now and more importantly would give government the incentive to make sure the flow of money is maximized.
Click to expand...

Every state collects sales tax. Collecting a federal sales tax only on new retail items, by the same mechanisms, is nothing.
 
ecofarm said:
Every state collects sales tax. Collecting a federal sales tax only on new retail items, by the same mechanisms, is nothing.
Click to expand...


Not true at all, Oregon and Montana at least do not have sales taxes
 
Taylor said:
Of course you will.


More likely, they'll spend the money on something else that isn't taxed to hell.

We tried this back in the 90's. It was a miserable failure.
Click to expand...

Well we still have the "gas guzzler tax" and sales of Dodge Hellcats have not been effected. In fact there is now a Jeep Hellcat and a Charger one too. Most all "super cars" are sucject to that tax and sales just keep increasing. No one cares if they want that car....and can afford it. Here's a list of cars subject to the tax in 2016

https://nepis.epa.gov/Exe/ZyPDF.cgi/P100OA3I.PDF?Dockey=P100OA3I.PDF
 
EMNofSeattle said:
Not true at all, Oregon and Montana at least do not have sales taxes
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I think they could manage like every other state does.

And the Fair Tax isn't some idea on a forum, it's a Bill with dozens of co-sponsors including a handful of senators.
 
ecofarm said:
Used goods are not taxed. Poor people pay almost or nothing, rich people buy new retail goods.

At least get some education on the Fair Tax before randomly spewing against it. Plenty of Dem Reps co-sponsored the bill.
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I'de much rather tax money NOT spent at a higher rate instead of the reverse.. We have weak growth already. Not to mention how shady the black market would get. What is the definition of "used"?
 
iguanaman said:
I'de much rather tax money NOT spent at a higher rate instead of the reverse.. We have weak growth already. Not to mention how shady the black market would get. What is the definition of "used"?
Click to expand...

used = not new retail

Plenty of problems that appear at first glance have been worked through. This isn't some new idea. There's plenty of information about it.
 
ecofarm said:
Every state collects sales tax. Collecting a federal sales tax only on new retail items, by the same mechanisms, is nothing.
Click to expand...

I am not quite sure what you are getting at. If you are saying that collecting a federal sales tax is nothing then you would technically not correct as there are states that do not collect sales tax they would have to initiate some mechanism.

I am not proposing a sales tax of any kind. I am proposing a transaction tax which is a different animal and much more encompassing and yet limited. I am proposing taxing the flow of money. So when somebody transfers money they are taxed. They buy and sell stocks they are taxed they then move that money to another account they are taxed. Every time that money moves it is taxed. By keeping the percent taken very low it makes avoidance pointless and relatively painless.
 
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