Redstate

You come in and do hit and run diaries about the fair tax but everytime a difficult question comes up about the Fair Tax, you run away, only to repost essentially the same thing a week or two later.

You still haven't explained how we would deal with enforcement issues?  If we no longer monitor revenues how can we know whether someone is paying their "fair tax"?

I think this comment is pretty disingenuous as well..

Lie #3: the Fair Tax would abolish the IRS.

Laurence Vance debunks this one himself. "The Fair Tax will abolish the IRS in the same way that it will abolish the income tax--by replacing it with something else." The assertion that item #3 is a Lie is false

Boortz is trying to suggest that we will do away with the IRS and it's functions.  He's not.  All his proposal does is remarket the IRS with a new name.

Flyerhawk

I am confused by your post.   I try to respond in most of my entries if others have not already answered your questions before me.  

If I missed one of your questions or concerns please contact me directly at merrillb@localnet.com and I will try to answer your concerns at any time.

You Can also vist my Blog: http://fairtaxreform.blogspot.com/

All Posts are emailed to me from there as well.

I am not doing a "hit and run" post and do not beleive I have ever not responded.

I am postng a rebuttal response that is in support of the Fair Tax and I believe counters the premis of the Mises article.

As I said in my post the Fair Tax is much more than a radio talk show host's book and more complete than the people that want to nit pick at Boortz' serious and sometimes humorous jabs at the IRS.  

Now to your first point.  

You wrote "If we no longer monitor revenues how can we know whether someone is paying their "fair tax"? "

That is the point we no longer monitor revenue under the Fair tax. The Fair Tax is on Consumption!

We no longer have to monitor 200 million personal and business tax returns that monitor revenue in order to assess taxation under an extremely volumous pile of IRS regulation for individuals and business.

That goes a long way to answer your other point on enforcement.  Enforcement is easier because you eliminate thousands of pages of regulations, tax breaks , tax loopholes, depreciation tables, etc.

The Fair Tax is easier to enforce  for another reason - Less tax returns to monitor. you reduce your tax returns for business and individuals from about 200 million down to about 16 million.

It is easy for most to agree that 16 million is easier to enforce thatn 200 million.

Plus the Sales tax return is much easier to compute and monitor than an IRS Income tax return.

For all intensive purposes the IRS is replaced or abolished with a much simpler means of monitoring and enforcement. 45 States currently haves Sales Tax system and under the legislation they can choose to collect the National Sales tax under the Fair Tax Legislative package. For their work they will recieve a fee for collection as will the Retailers that collect the Tax.

It makes sense that the Revenue agents that used to work for the IRS, may now find employment in these State Sales Tax Departments.

Internal Revenue Service will no Longer monitor REVENUE but Sales tax on Consumption of new products and Services.  I imagine it may have a new name.

I'll check in later for any other points you may wish me to respond to.

How do we handle inforcement of the income tax? Not very well. It is you that determine your tax liability. The IRS depends on you providing accurate information... reporting all your income, only taking deductions you actually qualify for.

It is much easier to ensure compliance with a sales tax. States do that right now in a much less expensive and less invasive way than the IRS does with the income tax.

People's problem with the IRS is how much power it wields. If you have a complicated tax return you are at the IRS's mercy. You can easily end up in trouble even if you intended to do everything right. The IRS can (and does) change the rules retroactively down the road, so even if something was generally accepted at the time, they may still come after you later for it. The tax code is filled with pitfalls and people fall into them every day. That is why we spend so much as individuals on tax advice and preparation.

How do we handle inforcement of the income tax? Not very well. It is you that determine your tax liability. The IRS depends on you providing accurate information... reporting all your income, only taking deductions you actually qualify for

The IRS doesn't rely on your providing accurate information.  They rely on employers and financial institutions providing accurate information.  If you  you report earnings that are wildly off from what is reported by the afotementioned you can expect to get an inquiry  from the IRS.

States are able to collect sales taxes effectively because they are applied in limited scenarios and the states can find out relatively easily if a company is hedging on their giving their sales tax receipts to the government.  Without any sort of mechanism of knowing how much a company earns how can we effectively gauge what the proper sales tax  numbers would be?  

So if a company simply lies and reports only 50% of their sales how does the new and improved IRS figure out that they are shortchanging Uncle Sam?

In your next post You said,

" States are able to collect sales taxes effectively because they are applied in limited scenarios and the states can find out relatively easily if a company is hedging on their giving their sales tax receipts to the government."

States will collect the National Sales tax on behalf of Uncle Sam. So if it is easy for them to do so for their State Sales Tax collection it will be just as easy to do it for the national Sales Tax.

In New York for example,  You have to have a State Sales Tax number in oreder to buy whoelsale with no sales tax from distributors and suppliers.

Same for a Federal Sales Tax number under the Fair Tax.

For Both, you compare data on that Sales Tax number, you compare wholesale prchases to Retail Sales and can tell much more easily if someone is hiding or cheating than using the Income tax code.

The vast majority of the 16 million businesses that will be monitored will not want to jepordize their business by cheating but some will stil cheat just as they do now.

But it is fair to say that the Fair Tax will have a smaller percentage of tax evasion.  

It is also fair to say the the vast majority of tax dollars collected will be by business that won't cheat. By National Businesses that collect sales taxes in over 45 states now. Stores like Sears, Wal-Mart, Starbucks, Home Depot, Target, etc.

The first problem is that the government is able to check whether businesses are paying their sales taxes because they are able to check their revenues.

The only way that the states could ensure that a business is paying their sales tax is to do a thorough audit.

The second problem is that you are significantly expanding where the sale tax is applied.  No longer would it simply be on retail sales.  It would cover all services rendered.

Service related businesses will see major increases in their costs because they are less effected by various taxes as it stands.   I am confused as to how this would be applied as well.   Would someone who provides dog training be required to charge a tax?  What about independent contractors?

In New York State, the law makes sales taxes a personal liability of business owners and senior managers. Even if a business folds, the owners and managers are personally on the hook for any sales tax liability the State may determine. And they make these determinations almost arbitrarily if they decide they don't like you. If you don't believe this, neither did my $600/hour lawyers at first.

You seem to be stuck on tracking earnings when we only have to track Sales or Consumption.

Companies will still keep the books on earnings and report to their Stock holders or to their private owners.  But net profit or earnings is not the issue, Gross Sales is the the item to be tracked and compared to wholesale purchases.

In New York, if you buy something wholesale with no sales tax and use it in the business there may be a use tax owed.  Under the Fair Tax, if it is used for production of the product or service for retail sales there is no tax owed by the business on that purchase.  

The Fair Tax is included in the  price sticker at the store and is seperated out to show how much was tax at the register.  For example a scarf priced as $10 on the rack at WalMart.  $10 is all you pay but included in that and shown on your receipt is the Fair Tax.  Base Cost of the Scarf $7.70 and the National Sales tax is $2.30.

If the business owner is using a vehilce for the business(95%) than he pays no national sales tax  on that purchase but business use has to be tracked and demonstrated if the business is audited(sales tax audit).  Similarily capital purchases like vehicles may be depreciated or written off as a business expense against income for the business under the income tax.

The Fair Tax is simpler to audit and manage for the business.

Businesses still keep records and still report to the State and the Federal government but with a much simpler form based on Gross Sales.

If audited Gross sales can be matched with wholesale purchases to see if gross sales are underreported.

WalMart will still report accurate Gross Sales, as will Taqrget and Sears and Home Depot.  Each one of those comapnies will be compensated a small percentage for collecting and submitting the National Sales tax on their Gross Sales.

16 Million businesses submitting 16 million Sales tax returns will be much simpler than 200 million individual tax payers and businesses submitting a much more complicated Income tax return.

Can there still be Cash business not reported or able to be audited?  YES   Those that cheat now may still cheat but will find it harder to hide it. Plus we will pick up much more of that because it will get taxed when than money is spent at a restaurant, Target, or Home Depot.

Thank you for your thoughtful questions.

When you step back and look at the whole picture this is better for business by far.

#1 they no longer pay payroll tax or corporte income tax.

#2 They no longer pay the much higher compliance cost associated with the IRS tax code.

For Many Serivice businesses they sell products and services and are already collecting Sales tax anyway. I.e. auto repair services, heating contractors, carpet installers, roofers, etc.

Now you are correct some service businesses will have to add on a sales tax where they did not before but the trade off of eliminating income and payroll tax should make that an easy decision.

For Example; Lawyers will have to collect the tax for their services charged.  They also save a ton in overhead because their payroll costs have dropped at least 7.65% for their portion of payroll tax.

Like many small businesses even Dog trainers will need to charge the sales tax as well as independent contractors.  But you see the best thing about the Fair Tax for these Sole Proprietors is they do not pay the payroll tax which costs them the full 15.3% on wages plus the income tax at an individual rate for their samll business. ( sole proprietors pay both halves of the payroll tax as they are both the employee and the employer)

For small business people like this they love the Fair Tax.

The Dog trainer had to charge enough to cover paying the 15.3% in payroll tax and his income tax to have enough left to live on.  If he was in a 15% income tax bracket his total tax liability was 30.3%. That had to be worked into his pricing.

Not an official position of the Fiar Tax but this idea makes sense.

The idea behind simplifying taxation with a national sales tax is to  not have exemptions on what is included and what is not. Include everything for the sales tax and you net a lower rate.

EX. Shopping Cart with $100 worth of Groceries. I beleive in NY and other States - Some processed foods are taxed and other foods ae not charged a State Sales tax. Candy is taxed, twinkies are taxed, etc.

If half of your shopping cart is processed foods and snacks and half is healthy milk, eggs, bread than you pay 8% state sales tax on $50 or $4 in State Sales tax.

Now just to make it simple for everyone and in programming the scanners, let's just charge a Sate Sales tax of 4% with no exemptions.

Now the full $100 of groceries pays 4% Sales Tax or a total of $4.  Consumer paid the same in tax but the whole process much simpler.

Now if states like NY matched their Sales tax to the Fair Tax - collection would be simpler and the State sales tax could be lowered.

It is estimated that retail consumption is about

50% Products and 50% Services in the Economy.

That means New York State could match the Fair Tax and apply their Sales Tax to both products and services and be able to lower their State Sales tax from an average 8% to 4% and raise the same revenue for the State.

Others have proposed that you could leave the Sales tax at 8% apply it to both Products and services and than eliminate the NY State Income tax or lower local property taxes.

...sales-taxing services etc in order to gain a simpler enforcement regime. You'll need to convert a huge number of small service providers to collecting sales tax. That's probably a surmountable objection but we need to identify it.

Now this leads to a bigger implementation issue with Fair Tax. Do you tax everything? No exemptions for services or healthy foods? Fine, I thought so. (And the prebate solves the regressivity problem.) Now what will it take across 50 states to harmonize all the large and small businesses so the right people are collecting the right sales taxes? Obviously a large problem, but is it a difficult problem?

Not Difficult at all, many small businesses handle a variety of sales tax rates already.

In New York, The tax rate changes by County, so if you are selling product now in multiple locations you have multiple sales tax rates to keep track of.

If you are a Car Dealer, the sales tax can be based on your home address, Niagara County is differnet than Erie County.  

If you are a small vendor who travels to trade shows selling your wares, you pay different taxes in different states.

If you are a large national chain, your stores have to keep track of all the different State and County Sales tax rates and the different rules on what is taxed and what is not. ( home Depot, walmart)

For most buisnessmen keeping track of Sales tax  pales in comparison to some of the accounting and filing regulations or rules the IRS requires to file an income tax return for you business.

Across all 50 States will have to be decided State by State what works best for them.

Though I do beleive many States are trying to get together to standardize sales tax rules to make it easier for retailers.

How much easier it would be if you just piggybacked on the Fair Tax plan and tax all retail sales of products and services at final point of purchase.

45 States have a sales tax already.  Why not make life simpler for American business and American Families??

Adding on sales tax to the bill is no more difficult than adding in another item or service to the bill.  Accounting and record keeping is no more difficult than tracking one item in inventory that you buy from one specialty supplier each and every month.

Each month the business person just takes Gross Sales times 23% and submits what needs to be submitted minus a small percentage allowed in the law to cover the business persons expenses.

It is not any harder than many other little tasks business owners do every day.

So everyone is going to pay lower taxes and yet this is a revenue neutral tax.  OK.

Yippie You got it.  I had trouble convincing an economist on WSJ Online as well.

You see it is Economics 101. Increase the tax base and you lower the rate. The consumption tax base is larger than the earned income tax base.

Taxing consumption captures part of the illegal or unlawful income of criinals whenthey buy jewelry or other household items.

Taxing consumption captures part of the illigal income paid to illegal aliens and House keepers in Cash.

Taxing Consumption captures part of the income underreported by many who cheat just a little on their Income tax and don't report it all.

Taxing Consumption captures more from tourist dollars visiting the US.

Taxing cosumption captures more revenu from the wealthy when they buy the expensive things they buy they pay the Fair tax. It doesn' matter tht it was inherited wealth or investment wealth, or a golden parachute. They pay a fairer share now.

That will net out much better thatn the 12% TehresaHeinz Kerry and her husband reported for the 2004 election.

Retail Gross Domestic product is larger than taxable income in the US ( and every where else as well)

Its simple, if you tax a million dollars of wage income at 25%, the IRS gets $250,000.  If I tax consumption at 20% but have $2 million to tax than the Federal government gets $400,000. Not all consumption is bought with wage income. Some is bought with savings, investment, and other sources.

The Rate is lower and could go lower to get become revenue neutral.

Original AFFT calcualtion were based on NIPA tables and even those don't include all economic activity.

You should really spend time at the FAQ section of www.fairtax.org; the research and rebuttal sections would answer you very well also.

Come on Flyerhawk You Love the Fair Tax don't you??  Come on tell the truth.

Your questions are honest and thoughtful and I thank you for the opportunity to respond.

There are a number of problems I still see.

It seems to me that you are basically alleviating the wealthy and businesses of paying taxes.  Businesses are explicitly exempted, even from paying  for goods and materials apparently.  The wealthy because their retail purchases are a small part of their overall wealth.

How would you control the concentration of wealth?  By going to a regressive tax system like a sales tax we would have no controls to limit the concentration of wealth.  Even more troubling a sales tax would completely ignore ALL investment transaction, thus allowing the wealthy to continue to grow their wealth at a geometric rate.  

Retail Gross Domestic product is larger than taxable income in the US ( and every where else as well)

I find this a dubious claim.  Our GDP is about 11 trillion. Our tax revenues are about 2 trillion.  Assuming a rough number of a 20% effective tax rate of average, that would be a taxable base of 10 trillion dollars.  Seems pretty close to taxing our GDP.  Do you have any evidence to show this is true?

The IRS doesn't rely on your providing accurate information.  They rely on employers and financial institutions providing accurate information.  If you  you report earnings that are wildly off from what is reported by the afotementioned you can expect to get an inquiry  from the IRS.

People cheat on their taxes all the time. Some are better at it than others. If you get a W2 or a 1099 it is pretty stupid to not report those earnings (though plenty of people still take the chance)... Many people also get earnings that are not reported. It is even easier to cheat on the deduction side.

The argument that a sales tax is harder to enforce than an income tax is so rediculous, I just don't know what to say.

States are able to collect sales taxes effectively because they are applied in limited scenarios and the states can find out relatively easily if a company is hedging on their giving their sales tax receipts to the government.  Without any sort of mechanism of knowing how much a company earns how can we effectively gauge what the proper sales tax  numbers would be?

Limited scenarios like what? On everything you buy anywhere you buy it? That doesn't seem that limited to me.

Sure, companies would have to report their receipts to the government. They would have no problem doing so since that is still hundreds of times simpler than what they have to do now.

The FairTax is not regressive since there is a credit for each person. If you want to talk about regressive taxes, just look at FICA. They don't get any more regressive than that.

I would not be opposed to leaving the estate tax in place myself. That would solve the wealth concentration problem.

It's one thing to propose overhauling revenue collection so as to get the most government revenue with the least impact on the economy. But you're also adding in a fundamentally social goal, which is to create fairness, specifically by eliminating "conentrations of wealth." If this is going to be a goal of tax-collection reform, let's be explicit about it, because it's a different goal with different economic effects and tradeoffs.

My simple question to you is: what's wrong with concentrations of wealth?

the biggest problem with wealth concentration is that it creates a large division between the haves and the have nots.  As this gap increases social tension increases as the have nots become increasingly upset over what the haves control.

This generally leads to revolution.  

It isn't about fairness.  Fairness is an impossible to define term when it comes to taxation since taxation is, by definition, unfair.

This is about social stability.  When a society allows an aristocracy to come into being, that society is doomed.  

It just provides some relief.   It's still a flat tax that inordinately hits lower classes, since they spend all or almost all of their money on retail purchases.

I would also like to know how the flat tax deals with the housing market?  Are we going to start charging 23% on top of all housing sales?  That would have some seriously negative consequences.

It is the opportunity and history of America that no matter what your social class in other countries, the chance to do well, start your own business and build a better future for yourself and your family is the American Dream.

It is still a right to be able to have that dream be an extension to your children and Grandchildren giving them more than one's parents gave them.

Any intrusion into that, isn't fair to all classes, rich or middlle class. In my humble opinion, Anti Wealth Accumulation is Anti- American and not true to our founding and dream of our nation.

Gathering or concentration of wealth if earned legally is not a bad thing.  Wealth creation is the reward for risk and hard work. My children and their heirs are entitled to it because I earned it. If I choose to inest it in Government Bonds or other investments and give my heirs an income that is as American as Apple pie.  Because I build wealth does not mean I than have to give 60% of my pie to Uncle Sam before my family divides what is left.

The Government is not entitled to it because I decide to give the fruit of my hard work to my heirs.

At its core, the idea that the wealthy should pay a higher percentage of tax to avoid wealth accumulation or that double taxation should occur on one's estate is a Socialist Concept of wealth redistribution.

Don't worry even under the Fair Tax the Wealthy will still be paying 80% of the tax in real dollars just as they do now.

A Flat Tax with no loopholes can be on Income or consumption and it will be a fair system.

A 20% tax  Means the wealthy spend $1 million they pay $200,000 in tax.  if the Middle Class spends $100,000 they pay $20,000 in tax.

The wealthy family does not get ten times the benefit from Government services or what Government provides but they pay in real dollars ten times as much.

Besides Rich Democrats don't pay their share of taxes under the current system anyway.

Read : http://fairtaxreform.blogspot.com/2005/12/wealthy-democrats-dont-pay-their-
fair.html#comments

AS I review posts, I am reminded that you have been pointed to sources several times to answer in great detail each one of your concerns.

You just keep lobbing the same tired questions which have been rebutted with facts and answered over and over.  You seem to want to generate doubt and confusion not out of an honest desire for discussion or knowledge but to tear down with negativity not based in fact or based on anarchist point of view that all taxation is bad and you just don't like anything.

ASKED AND ANSWERED.

Fair tax treatment of Real Estate : Please Read;

http://www.fairtax.org/real_estate.html

45 FAQ section - Read and have your questions answered.

http://www.fairtaxvolunteer.org/smart/faq.html

Rebuttal section On GDP, NIPA , Consumption vs. Revenue.  Please Read.

http://www.fairtaxvolunteer.org/smart/rebuttals.html

That's why it's fun to debate with you. You didn't explicitly say so but I'll assume you consider it an appropriate goal for tax-collection overhaul to create (well, you don't like "fairness," so let's call it...) egalite'. Or at least to create more egalite' than we have now.

You interpret history as suggesting that inegalite' results in revolutions. You're considering the relative level of economic well-being between "haves" and "have-nots." But the word "have-not" also suggests that the absolute level of economic well-being matters just as much.

In today's America, we have "haves" and "have-mores." If you think the distinction is meaningless, I would argue that people at the relative low end of the wealth scale but still are warm, well-fed and own cars and houses are not going to be taking to the ramparts and putting billionaires under the guillotine any time soon. (Much as the thought cheers the denizens of Daily Kos.)

You may be able to think of a system for preventing the accumulation of wealth that does not destroy economic incentives and thereby lowers the overall size of the economic pie. I can't think of such a system. I don't want to see us end up like Europe which has achieved egalite' in a strict economic sense (but definitely not in a social sense), and is economically and demographically moribund as a result.

I don't think egalite' should be a goal of our tax-collection system. In plain terms, it costs too much. Think of another way to get it.

    It's not that I am some secret desire to have an evenly distributed wealth.

   I'm a firm believer in working on the edges.  Support the most destitute and limit the abilities of the most wealthy to leverage their wealth for excessive wealth accumulation.

   Now I know that a term like "excessive wealth accumulation" brings up images of Das Kapital and October executions so let me point out that I am NOT looking to soak the rich or limit their ability to make money per se.  I am merely saying that, at some point, we create a de facto aristocratic rule if do not put some sort of limit on wealth accumulation(this is why I strongly support the estate tax)

   I do think that having a very small group of people control a significant amount of our wealth is a dangerous problem.   It leads to a plutocratic rule.

   I certainly do not believe that we are on the precipice of falling into a social upheaval.  However I also believe that, for all its flaws, our current tax system works to alleviate this potential problem and by chaning our tax system to one in which there are limits on the accumulation of wealth, we run the risk of allowing this problem to come into fruition.

You seem to want to generate doubt and confusion not out of an honest desire for discussion or knowledge but to tear down with negativity not based in fact or based on anarchist point of view that all taxation is bad and you just don't like anything.

I don't believe in magic and I don't believe in creating MASSIVE change on the HOPE that it MIGHT create more wealth.

I read the first article you linked to regarding housing and the fair tax.  It dealt almost ENTIRELY on vague notions that since people keep more of their money that means they will save more of their money.  More circular logic.  If we are to assume that the fair tax is revenue neutral that means that SOMEONE is still paying the taxes.    Whether it is withheld upfront or taken out at consumption the government still is getting the same amount of money.  

Nowhere do they explain how to offset the very real problem that new homes will be drastically higher in cost than existing homes.  This is basic supply and demand.  If I can buy an existing home for 500K or a new home that is identical to the existing home for 615K, why in the world would I by the new home?  I'm starting off with a 100K of negative equity the moment I sign the papers.  The paper doesn't address any of that.  Instead it talks about all the new wealth that this plan would create.  

I have no idea why your faq list is relevant and please point to a specific rebuttal piece instead of pointing me to a bunch of rebuttals that mostly deal with saying the same thing over and over.

TAANSTAAFL

That comment was basically a conglomeration of hedged, disconnected statements, so now I don't know what you're saying again.

I think you're saying that "plutocracy" and its historically-associated social ills are something to avoid but not really a problem for us. You don't like the word absolute any more than you like fairness, but you didn't address my main point, which is: if the non-plutocrats have a comfortable life as they do here in the US, then your disaster scenarios will not come to pass.

You support the estate tax. Do you support increasing it to 100% above a certain amount of wealth?

Express yourself clearly, hawk. I don't bite (hmmmm, well sometimes I do).

if the non-plutocrats have a comfortable life as they do here in the US, then your disaster scenarios will not come to pass

Sure.  However we are not talking about the here and now.  We are talking about a future day in which the inherent controls fighting the concentration of wealth are removed.  

This thread is about implementing a national sales tax to replace all sorts of other taxes.  IMO, this idea is fraught with problems that are not easily resolved.  One of these problems is the elimination of controls on the concentration of wealth.  

You support the estate tax. Do you support increasing it to 100% above a certain amount of wealth?

That is an interesting question.  I don't think I would have a problem with this depending on what the threshold is.  At 1 million dollars a 100% estate tax would cause more harm than good.  At 1 billion dollars I think you would be hard pressed to say that someone "deserves" a billion dollars in inheritance.  

I have nothing against the word absolute.  I have a problem with dealing in absolutes.

...about a national sales tax that permits concentrations of wealth that you consider socially destabilizing? Is it the abolition of taxes on capital gains? I assume you're ok using "prebates" to get basic progressivity.

Your take on estate confiscation amounts essentially to "no change." There really aren't all that many billion-plus dollar fortunes in the US. Maybe 500 in all. Not many people with that kind of money leave it to their kids anyway. Neither Bill Gates nor Warren Buffett, the two richest Americans, are planning to. It's pretty nutty to cut the government in for 55%, so people find better things to do with it.

Supply and demand will have new home price reflect the savings through the supply chain for exactly the reason you mentioned.

Potential 20% drop in the cost to build that Home means a 20% drop in price. Add in the sales tax and you are back up to an equal price to the existing home that was built the previous year under the Income Tax.  Keep reading. The Answers are there.

Start with the 30 plus page rebuttal to William Gale, I beleive that will give you the most technical answers to your swipes.

This Plan has been well researched and the data is there if you want that level of detail.

This Plan is not magic and is well supported by well known economists from around the country.

http://fairtaxreform.blogspot.com/2005/04/geter-done-economists-nationwide.
html#comments

Consumption taxes are generally considered a more efficient form of taxation and it is also well accepted that it promotes an increase in the savings rate.

It is not a vague notion nor is it circular logic.

It is a well researched plan that many economists support as being better for the country.

The FAQ Section is very relevant.  Because every short pot shot you take has a responding FAQ.  REAd them all and I beleive you have your answers.

For Example FAQ 33  http://www.fairtaxvolunteer.org/smart/faq-main.html#33

Does the FairTax improve compliance and reduce evasion when compared to the current income tax? The old aphorism that nothing is certain except death and taxes should be modified to include tax evasion. Tax evasion is chronic under any system so complex as to be incomprehensible. As a percentage of gross domestic product (GDP), tax evasion is beyond 2.0 percent, compared to 1.6 percent in 1991. Tax evasion continues to be in the range of one quarter of income taxes collected. Almost 40 percent of the public, according to the IRS, is out of compliance with the present tax system, mostly unintentionally due to the enormous complexity of the present system. These IRS figures do not include taxes lost on illegal sources of income with a criminal economy estimated at a trillion dollars. All this, despite a major enforcement effort and assessment of tens of millions of civil penalties on American taxpayers in an effort to force compliance with the tax system. Disrespect for the tax system and the law has reached dangerous levels and makes a system based on taxpayer self-assessment less and less viable.

The FairTax reduces rather than increases the problem of tax evasion. The increased fairness, transparency, and legitimacy of the system will induce more compliance. The roughly 90-percent reduction in filers enables tax administrators more narrowly and effectively to address non-compliance and increases the likelihood of tax evasion discovery. The relative simplicity of the FairTax promotes compliance. Businesses need answer only one question to determine the tax due: How much was sold to consumers? Finally, because tax rates decrease, tax evasion is less profitable; and because of the dramatic reduction in the number of tax filers, tax evaders will be more easily monitored and caught under the FairTax system.

Or FAQ # 17

How much do pre-tax prices for goods and services go down under the FairTax?

All goods and services already contain the embedded costs of the current tax system in their prices. When these embedded taxes are removed, prices come down. Dale Jorgenson, Ph.D., former chairman of the Economics Department at Harvard University, has projected an average producer price reduction of 22 percent for goods and services in just the first year after the adoption of the FairTax. In addition, the FairTax lowers compliance costs by an estimated 95 percent and the removal of these costs will force prices down even lower.

than just the abolition of the capital gains tax.  It is the abolition of any restraint on revenue.  

This fantasy that the wealthy will cover most of the sales tax is just that, a fantasy.  

I think it's great that people find better things to do with their money than give it to the government.  I also think it's great that the Gates children won't inherit billions of dollars simply because they won genetic lotto.

Are you against some people getting really wealthy, or are you for the government having a lot of different ways to get money from us? Or both?

I happen to be really in favor of cutting down on the ways the government can get money from us to spend. After all, we're not going to be getting spending discipline from Congress any time soon, because those people need to get re-elected every so often.

Consumption is something we all do, in rough accord with our levels of income, so that really is the best thing to tax. You'll respond that wealthier people consume proportionately less of their income. But they're not flushing the rest of their money down the toilet, they're investing it. We need as much of that behavior as we can get.

It's not news that you get less of whatever you tax. Capital formation is something we really shouldn't handicap, so I'm in favor of not taxing it at all. What does this really mean? My point of view means that individuals should decide how to invest the fruits of success. Your point of view (which involves letting the government whack away at capital gains and other returns on wealth) means that the government should make some of those decisions. I could almost bite off on your view if not for the fact that I don't trust the government to do the right thing. The incentives of either bureaucrats or elected officials are simply not aligned with ours.

Representative Linder and Neal Boortz, a popular talk radio show host promote what they call the Fair Tax.  But in in simple language, H.R. 25 [the alleged FairTax] is a wealth based tax, meaning: the most productive members of society shoulder the burden of the cost of government and do so without a proportional representation, or voice, in the determination of how their money is spent!

H.R. 25, as does an income tax, as does a flat tax, allows the spending of tax revenue without regard to a proportional influence by those who filled the national treasury.

In short and simple language, H.R.25  ignores the Founding Founder's rule of representation with proportional obligation and embraces a Marxist idea: "from each according to their ability to each according to their need".

For a full explanation see: The Fair Tax Con Artists

Regards


JWK


ACRS

P.S.

If H.R. 25 was enacted into law tomorrow, and a future Congress followed its language to the letter, would that future Congress have authority to calculate a tax from corporate income as upheld in FLINT v. STONE TRACY CO., 220 U.S. 107 (1911)? The answer is, YES! Our socialists in Congress would still be able to lay and collect a tax calculated from income just as is now calculated under the Income Tax!  This is what the FairTax Con Artists don`t tell you.

Another observation concerning H.R. 25, the alleged Fair Tax.

Another objection to H.R. 25, the alleged FairTax, is its attempt to resurrect a socialist type of tax allowable under the Articles of Confederation__ a general across the board tax based upon wealth in which each member state agreed to contribute into the common treasury in proportion to its assessed wealth.

Article VIII. of the Articles of Confederation states:

"All charges of war, and all other expences that shall be incurred for the common defence or general welfare, and allowed by the united states in congress assembled, shall be defrayed out of a common treasury, which shall be supplied by the several states in proportion to the value of all land within each state, granted to or surveyed for any Person, as such land and the buildings and improvements thereon shall be estimated according to such mode as the united states in congress assembled, shall from time to time direct and appoint."

But this kind of tax, a general tax based upon wealth by which the various member states agreed to contribute into the common treasury under the Articles of Confederation, was rejected during the Convention of 1787 and protection was afforded against it by a new rule requiring the general tax to be apportioned among the states and basing each state's share, not upon wealth, not upon "income", but upon each state's number of representatives in Congress---in other words representation with proportional obligation__ the new rule for a general tax which socialists and the friends a profligate  big government hate with a passion because it is an antidote to a spendthrift big government and takes the socialist sting out of a general across the board tax upon wealth in which member states are to contribute into the common treasury.

Although H.R. 25 does not calculate each state's share of the tax upon its assessed land value as done under the Articles of Confederation, it attempts to accomplish the same socialist objective by calculating the contributions of each member state by the value of property sold and its economic enterprises as reflected in business transactions within each particular state, and is, without question, a general wealth based tax which the wise Framers agreed, and those ratifying our Constitution agreed, may be laid among the states, but requires an apportionment based upon each state's number of representatives in Congress Assembled, which was an important compromise during the Convention of 1787!

H.R. 25 is another attack upon federalism, attempts to accomplish indirectly what the Constitution was intended to forbid directly, and seeks to establish a socialist friendly type of wealth based tax in which the most productive member states in the Union would be compelled to carry the burden of taxation while the least productive states may feed from the public trough using their vote without contributing in proportion to their voting strength.

In harmony with the new rule of apportionment agreed to by the ratification of our Constitution, and when the various states are required to contribute into the common treasury in a general tax such as H.R. 25 is, Congress is required to determine a total sum needed to be collected under the general tax and then notify each member state of its share of the total amount to being collected, basing each state's apportioned share on its allotted number of representatives, and, when each state`s share of the total being collected is raised and deposited with the Treasury of the United States, the tax is to be suspended in those states having paid their apportioned share of the general tax being collected.

Now, how does one confirm the historical truth of this matter, and, was this the intention of the framers and ratifiers of our Constitution? Well, we can do this by reading from the state ratification documents as to what the founders intended with regard to the various member states contributing into the common treasury in a general direct tax.

EXAMPLE:

Ratification of the Constitution by the State of New Hampshire

"Fourthly That Congress do not lay direct Taxes but when the money arising from Impost, Excise and their other resources are insufficient for the Publick Exigencies; nor then, untill Congress shall have first made a Requisition upon the States, to Assess, Levy, & pay their respective proportions, of such requisitions agreeably to the Census fixed in the said Constitution in such way & manner as the Legislature of the State shall think best and in such Case if any State shall neglect, then Congress may Assess & Levy such States proportion together with the Interest thereon at the rate of six per Cent per Annum from the Time of payment prescribed in such requisition- "

But were the above stated intentions generally understood and agreed to by the founders and then practiced by actual legislation for a general tax which would confirm such intentions? Well, let us read from the legislative Acts in which the general tax is involved:

APPORTIONMENT OF A DIRECT TAX TO RAISE A TOTAL OF $ 2 MILLION TREASURY DEPARTMENT MAY 25TH 1798

An Act to lay and collect a direct tax within the united states [1st direct tax July 14, 1789 for $2 million and each state's share of the $2million being raised.]

An Act to repeal the internal taxes April 3rd, 1802

An Act for the assessment and collection of direct taxes, July 22, 1813

Act laying a direct tax for $3 million August 2, 1813, and each state's share of the tax.

Section 7 of direct tax of 1813 allowing states to pay their respective quotas and be entitled to certain deductions.

And, for a $20 million direct tax being imposed upon the states in 1861, and the amounts required to be paid by each of the various states,

CLICK HERE

Bottom line: the only stinking tax reform we need is for the people to demand their employees in Washington add the following words to our Constitution, bringing us back to our Nation's original tax plan:

The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay ``any`` tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.

Regards,


JWK


ACRS

To study the founder's plan CLICK HERE and scroll down to

American Constitutional Research Service Before the


Committee on Ways and Means


United States House of Representatives


June 1995

To see what freedom loving people and real Americans are supporting CLICK HERE

The strength of our constitutional system is found in the people's will to rise up and defend their constitution--- it is not found in a piece of paper which merely guarantees the right to rise up.

To understand the FairTax fraud being perpetrated by Neal Boortz, one must first understand the 16th Amendment did not create any new tax.  The Amendment merely clarified a question about  a constitutional provision requiring "apportionment" of a tax calculated from income!

This happens to be an extremely important point and exposes why the sales pitch given by the FAIR TAX CON ARTISTS, especially Neal Boortz, their ring leader, is just that----a con job plain and simple!

We are told by Boortz his plan will eliminate "income taxes" [taxes calculated from income] and relieve us of the massive paper work and man hours wasted with such a tax.  But this is a bold face lie made by Boortz for two reasons:

1.

The tax Boortz mentions can only be "eliminated" by a constitutional amendment forbidding Congress to calculate a tax from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.

To this day, and to the best of my knowledge, there is no pending legislation on Capitol Hill promoted by the Fair Tax Con Artists which proposes: The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay ``any`` tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.

Without such an amendment to our Constitution, the tax mentioned by Boortz in his book and its collection agency is not eliminated as his book fraudulently portrays on its cover!

2.

But let's give Mr. Boortz the benefit of doubt and that it is his intention, by the language of H.R. 25, to "eliminate taxes calculated from income".

Sad to say even this turns out to be wishful thinking. If H.R. 25 was enacted into law tomorrow, and Congress followed its language to the letter, H.R. 25 makes no attempt by its language to prohibit Congress from laying an "excise tax" as mentioned in FLINT v. STONE TRACY CO., 220 U.S. 107 (1911), a case decided prior to the adoption of the 16th Amendment upholding an excise tax calculated from corporate profits, gains, and income.

The Fair Tax Con Artists having left this loophole,  invites a future Congress, in order to be in compliance with H.R. 25, to simply erase the word "Revenue" from "Internal Revenue Code" and replace that word with "Excise", as in "Internal Excise Code," and likewise erase the word "Revenue" from "Internal Revenue Service" and replace it with "Excise", as in "Internal Excise Service", and then go about its business inflicting the same time consuming and costly misery upon Corporations as now done under "income taxation", but in addition, these corporations will also have to abide by and follow a second rule book promoted by Boortz under H.R. 25,  with all its new regulations for record keeping and the payment of taxes as stipulated in its language!

And if you think this would not quickly happen with Congress' never ending appetite to increase its piece of the pie created by America`s businesses and labor, you would also have to believe there would be an earth shattering outcry from the people of America if H. R. 25 was adopted and after its adoption Congress decided to enact a small "pay their fair share" additional excise tax upon corporations and other wealthy scoundrels who make millions of dollars a year in "profits" and bleed the poor working people, as was alleged about Leona Helmsley, who just happened to pay more in taxes than the combined taxes paid by any 20 average working people in New York, but was then sent to jail because of Congresses predatory appetite.

But wait!  I though Boortz  was a defender of people being free to earn a profit.  So why, tell me why on earth does he promote a plan which provides the tools to Ted Socialist Kennedy, and his disciples in Congress, to continue to bleed the productive members of society, while giving a $ 400 per month bonus to un-wed moms to stay at home and make babies under his family consumption allowance?

Why does Boortz promote a plan which paves the way to create the largest entitlement program in the history of America under its b]family consumption allowance_ an entitlement which is estimated would cost $ 600 BILLION a year__ the cost of which would make the projected price tag of Hilary Health Care look like chicken feed?

Why on earth would Boortz, the self anointed enemy of socialism and defender of free enterprise, promote a plan which offers a windfall to the slugs and leaches in our society, and would give Ted Socialist Kennedy and his disciples on Capitol Hill a very valuable tool, the family consumption allowance which the will be more than happy to promise to increase during election time to buy millions of votes to remain in power, just as these socialists now do with the minimum wage, social security payments, aid to families with dependant children, Pell Grants, and you name it from the shopping list of government give-away- programs created by Congress__ the only difference with H.R. 25 is, its family consumption allowance promises to extend the tentacles of socialism to every American household with a monthly government subsistence check, making the majority of American households dependent upon a monthly government check!

Were we not warned by Hamilton in the Federalist Papers that control over a man subsistence is a control over their will?

Come on all you Boortz fan Fair Tax stooges, answer the questions!

Regards,


JWK


ACRS

The only stinking tax reform we need is to demand our employees add the following words to our Constitution:

The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay "any" tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.

It doesn't tax 135 pages of bull [H.R. 25] to accomplish real tax reform, it only takes the will of the people to rise up and demand their employees, their public servants, add the above words to their Constitution, bringing us back to our Founder's  ORIGINAL TAX PLAN

Regards,


JWK


ACRS

"In matters of Power, let no more be heard of confidence in men, but bind him down from mischief by the chains of the Constitution"---Jefferson

The Constitution Party calls taxes that are not apportioned to the states according to their wealth "unjust" and "unconstitutional".

And yet, the 16th Amendment grants Congress exactly that authority. It was passed by the Congress and duly ratified in accordance with the procedure set out in Article V.

So, your rant about apportionment seems to be rooted in a conviction that the 16th Amendment was somehow illegitimate or "unconstitutional". Do you feel the same way about all amendments? How do you feel about the 1st or the 2nd? Or the 14th?

I don't get it.

The FairTax would be much better than our current system.

As for leaving the income tax in place, Congress can do whatever they like. That is hardly an argument against the FairTax. They could increase all the marginal rates to 95% tommorow. It doesn't mean they are going to, but they certainly could.

You may not have noticed but the people do not pay for their government services now. Many pay no income taxes. Many get a free check with the EITC. These people consume much more in services than they pay in. You are really living in a fantasy world if you think that will ever change.

Why does Boortz promote a plan which paves the way to create the largest entitlement program in the history of America under its b]family consumption allowance_ an entitlement which is estimated would cost $ 600 BILLION a year

To be fair you would have to compare this figure to the size of all the deductions and credits in the current tax code, which would total much more than $600bln. This is a credit on tax paid, not welfare. Your $600bln figure also makes no sense at all since that is over $2000 per man woman and child living in the country.

Any system that replaces the income tax will have to replace ALL the revenue currently being generated. That is the political reality. It is also going to have to have some amount of progressiveness to it (though the FairTax is much less progressive than the income tax). That is also a political reality.

I don't believe the Constitution Party calls taxes that are not apportioned to the states according to their wealth "unjust" and "unconstitutional"

You may be correct if you wrote:  The Constitution Party calls taxes that are not apportioned to the states according to "representation" [not wealth} "unjust" and "unconstitutional".

Apportioning by assessed land value [wealth] was practiced under the Articles of Confederation and rejected during the Convention of 1787 as I documented above, and a new rule was agreed to by the ratification of our existing Constitution---the new rule for a general tax requires each state to pay in proportion to its voting strength in Congress!

Now, just for your convenience I will try to put that plan into a concept which you may be able to relate to.

Picture ten or twenty businesses in a section of town where armed robberies and burglaries begin to cause serious problems for the business owners.  The business owners get together to see how they can solve this problem on their own.  They decide that hiring an armed guard to patrol the area 24 hours a day would probably solve their problem.  Of course, in addition to hiring three guards to serve on different shifts, there would be the additional cost of purchasing a patrol car, upkeep, communications equipment, uniforms, etc.  And so, they try to work out an acceptable plan by which they all are to contribute to finance the security operation.

In addition to financing the operation, they realize decisions will also have to be made from time to time as to who to hire, how much to spend, and establishing the actual rules which shall be followed for the security operation.

One suggestion is made that each business owner contributes 2 percent of the total sales of their business and each business owner gets to cast one vote when policy maters are to be determined and a majority vote shall carry.

This is immediately objected to by several business owners.  In a number of instances there are two or three businesses housed in a large building, each of which wants a vote.  Others object and claim if there is only one building to be protected, only one vote should be allowed regardless of how many businesses are in the building. Why give each business owner a vote?  The rule is also objected to by some of these same business owners [those housed in one building] because their combined sales are at least four or five times higher than some other businesses housed in their own building,  and they would be contributing a much larger amount into the general fund to protect their building, but when it came time to making policy decisions, the remaining single business owners housed in their own building would control policy by their combined larger voting strength.

A suggestion is then made that each building to be protected shall be considered as a party to the security plan and each party shall be allotted one vote for each business owner contained in that building.  In addition, when contributions are required to be made into the common treasury, a total sum needed shall be determined and that sum shall then be apportioned among the parties [buildings] based upon their number of votes [businesses in that building].  In other words, each protected building contributes in proportion to its allotted number of votes . . .  representation with proportional obligation . . . a rule establishing an equal contribution from each business owner and likewise giving an equal vote in policy making by each business owner.

This is, in general, what our founding fathers agreed to when agreeing to apportioning among the states as I have documented in a previous post!

A national retail sales tax, the Boortz plan, an income tax, a flat income tax, as well as a value added tax undermines the rule by which each state is to contribute into the common treasury and allows a state with a large voting strength in Congress to dominate in the setting of policy, especially spending policy, but without having to contribute a proportional amount in financing that policy.

A national retail sales tax, as well as the other mentioned taxes used to finance the functions of our federal government removes one of the most important checks and balances our founding fathers agreed upon to help insure sound fiscal and economic policies___ policy making with proportional obligation!

Does this make sense to you?  

In regard to your comment about the 16th Amendment, the truth is, the 16th Amendment conferred no new power of taxation, and it certainly does not nullify the apportionment clause.

The 16th amendment merely confirmed that Congress always had power to calculate a tax from income [for example when laying an excise tax]. The question, which resulted in the adoption of the 16th Amendment was, did such a tax, when imposed, require an apportionment among the states?

This question was answered in FLINT v. STONE TRACY CO., 220 U.S. 107 (1911), prior to the adoption of the 16th Amendment, a case in which the court upheld the corporate excise tax of 1909, a tax calculated from corporate profits, gains and income!

It should also be noted that a tax calculated from income adopted during the civil war, was likewise upheld in SPRINGER v. U S, 102 U.S. 586 (1880), which was also decided well before the adoption of the 16th Amendment!

But the 16th Amendment most certainly did not nullify the apportionment clause intended to control a general tax among the states. For example, see:

BROMLEY v. MCCAUGHN, 280 U.S. 124 (1929) in which the Court states, well after the adoption of the 16th Amendment, and in crystal clear language: "As the present tax is not apportioned, it is forbidden, if direct."

Likewise, the Court indicated  the same in EISNER v. MACOMBER , 252 U.S. 189 (1920) Here, the Court discusses the 16th Amendment and also defines the definition of the word income as it appears in the 16th Amendment and goes on to emphasize, with regard to the 16th Amendment:

"A proper regard for its genesis, as well as its very clear language, requires also that this amendment shall not be extended by loose construction, so as to repeal or modify, except as applied to income, those provisions of the Constitution that require an apportionment according to population for direct taxes upon property, real and personal. This limitation still has an appropriate and important function, and is not to be overridden by Congress or disregarded by the courts.

Getting back to what the 16th amendment did, the SCOTUS states the following which is the same conclusion I came to after researching the framing and ratification of our Constitution, and federal taxation since its adoption:

"The sixteenth amendment conferred no new power of taxation but simply prohibited the previous complete and plenary power of income taxation possessed by Congress from the beginning from being taken out of the category of indirect taxation to which it inherently belonged ..."see: Stanton v. Baltic Mining Co., 240 U.S. 103, at page 112. (1916)

Regards,


JWK

The only stinking tax reform we need is for the people to demand their employees in Washington add the following words to our Constitution, bringing us back to our Nation's original tax plan:

The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay "any" tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.

It doesn't tax 135 pages of bullstuff [H.R. 25] to accomplish real tax reform, it only takes the will of the people to rise up and demand their employees, their public servants, add the above words to their Constitution!

The socialist friendly, big government friendly, Boortz supported H.R. 25 is not "much better",  it merely is a plan rearranging  the chairs on a sinking ship!  

As for your assertion that "Congress can do whatever they like", Congress most certainly cannot calculate a tax from profits, gains, and "income' if that power is removed by a constitutional amendment, which the socialist friendly, big government friendly Boortz supported H.R. 25 plan does not even attempt to forbid.

Yes, I have noticed that "people do not pay for their government services now. Many pay no income taxes. Many get a free check with the EITC. These people consume much more in services than they pay in. You are really living in a fantasy world if you think that will ever change."

Well, as long as there are people who support socialist friendly and big government friendly tax proposals, you probably are correct that no change will save our sinking ship.

I asked: Why does Boortz promote a plan which paves the way to create the largest entitlement program in the history of America under its family consumption allowance . . .  an entitlement which is estimated would cost $ 600 BILLION a year . . . the cost of which would make the projected price tag of Hilary Health Care look like chicken feed?

You answered:

"To be fair you would have to compare this figure to the size of all the deductions and credits in the current tax code, which would total much more than $600bln. This is a credit on tax paid, not welfare. Your $600bln figure also makes no sense at all since that is over $2000 per man woman and child living in the country."

I like your spin, but you are wrong on several accounts.  The family consumption allowance is an entitlement, it is paid to people not contributing into the common treasury in addition to those who pay taxes,  and its projected cost on an annual bases, including administrative costs, is $600 billion per year...the figure may be off somewhat but I did find it in a congressional hearing document. Your figure appears to reflect the $600 BILLION cost as a monthly cost rather than annual cost.

In any event, the family consumption allowance provides the tools to Ted Socialist Kennedy, and his disciples in Congress, to remain in power by promising to increase it during election time to buy millions of votes to remain in power, just as these socialists now do with the minimum wage, social security payments, aid to families with dependant children, Pell Grants, and you name it from the shopping list of government socialist programs created by Congress . . .  the only difference with the Boortz Plan is, its family consumption allowance promises to extend the tentacles of socialism to every American household with a monthly government subsistence check, making the majority of American households dependent upon a monthly government check and the consumption tax would continue to bleed the productive members of society, while giving a $ 400 per month bonus to un-wed moms who stay at home, do not contribute into the common treasury and make babies to increase their government check size.

You also wrote that, "Any system that replaces the income tax will have to replace ALL the revenue currently being generated."  Well, our founding fathers original tax plan allows for Congress to raise as much revenue as it may need, but it also provides checks and balances encouraging Congress to follow sound fiscal policies and makes each state's Congressional Delegation immediately accountable to their State Legislature and Governor if they are forced to lay the apportioned tax among the states requiring them to bring home a bill to their state for its apportioned share to extinguish a deficit created by Congress. Gee, how dare someone would want to control the reckless spending and borrowing practices of Congress with the founding fathers solution.

Regards,


JWK

The only stinking tax reform we need is for the people to demand their employees in Washington add the following words to our Constitution, bringing us back to our Nation's original tax plan:

The Sixteenth Amendment is hereby repealed and Congress is henceforth forbidden to lay "any" tax or burden calculated from profits, gains, interest, salaries, wages, tips, inheritances or any other lawfully realized money.

See how easy real tax reform is?  It doesn't take 135 pages [H.R.25] which would leave us on a sinking ship...it only taxes 32 words for the people of America to gain control of a runaway Congress!

Let me ask you a few questions with seperate posts so one can be sure your replies apply to the questions/clarifications in shroter blocks.

1. Are you saying a wealthy business owner who pays more in a tax( fee) for a government services should have more votes(proportional) than a teacher who pays in less?
   
2. Does that than apply to States votes in Congress as well?  If New York State pays more in taxes and fees than Montana, or Conneticut. Than they shuld have votes apportioned to their contribution to Federal services?

Or are we talking about just the business man who pays more gets ten votes and I get one when elected representatives to Congress??

You posted earlier ....

"...the new rule for a general tax requires each state to pay in proportion to its voting strength in Congress!"

Since the House of Representatives is proportional based on population (plus an additional 2 from the Senate);  

Would not a flat tax on income or on consumption of that proportional population result in total taxes form each state being proportional to their voting strength?

In Fact, in your businessmen and security example would not a consumption tax be best and most proportional.

The business with the most coustomers passing through and spending the most dollars would pay a flat rate consumption tax.  The customers are paying the tax not the business man.

Since it is the customers that are paying the tax and not the busiess man, they decide by their votes what security will be provided for the businesses in town. they elect the Mayor to manage and hire the police.

I see the Fair Tax getting you much closer to your goal than incorrectly trashing it as either Socialst or Communist.  The Fair Tax is much closer to the "Excise Taxes" of an earlier Century of our history.  

The Rebate(Prebate) system is not an entitlement program.

Unless, your tax refund check from your Income tax filing is an entitlement program.

You can argue that the EITC - Earned Income Tax Credit is an entitlement program when it goes to families that paid little or no federal income tax.

Conversely, You could also argue that the EITC is a net return to the working poor of their Payroll taxes.  The only entitlement part of the ETIC is that amount recieved over what you paid in if you were the working poor.

I bet the number of dollars that fits that part are small. Most of EITC is a refund of income tax or payroll tax.

The Rebate system under the Fair Tax is a refund given at the beginning of the month to cover the taxes(National sale tax)that a family will pay on essentials like Food , Housing, clothing, heat, electricity, etc.  This is   a $600 billion dollar Refund not an Entitlement Program at all. A refund system like this makes it simple and easy with no receipts to keep or complicated forms to file for your refund.

It is fair because it treats every family the same. A Married Family of Four recieves $479/month.  It doesn't matter if they are a maid or a millionaire they receive a flat family rate each month to pay for the tax on essentials. It is a refund of the tax spent on those essentials up to the poverty line for that family size.( Set by HHS)

No receipts, no complicated forms to fill out just register once with valid Social Security numbers for each family memeber.

States will collect the tax and receive a 25 basis point fee to do so.  

It will be proportional to the gross sales of products and Services in that State.

johwk you should love this. It does not tax the businessman at all it taxes only the consumer, not profits, not income, not capital gains, not inheritances or estates.  This is exactly fits your Founding Father's example for appropriate taxation.

It will be paid by consumers not busiesses so the consumers will have the vote.

The Prebate will be easy to administer because it is not a system requiring receipts and complicated filing forms.  The easiest will be to issue a family debit card that is refilled each month.

The Fair Tax is far superior than the Income and Payroll tax systems we currently have. You are making a much better system the enemy of your perfect system.  You must admit that this is much closer to your dream than the current system and your support is needed.  Your points often support the Fair Tax over the Income tax and we could use your help.

American for Fair Taxation have researched, focused group studied and developed the Fair Tax Plan over the last 10 years.  It is the best Tax reform and replacement plan in Congress as HR25/S25.  It is the plan with the most support 47 Co-sponsors to date and growing.  We need more citizens to write their Congressmen and women and tell them you want the Fair Tax as the Tax reform plan for the future of America.