Heres a link to cast your vote.

http://www.fairtax.org

-- I'mgame (frustrated@taxtime.com), April 10, 2000

Answers

Or, cast your vote for no National Sales Tax. The proposed "Fairtax" is described on their web site as follows:

"All federal income and payroll taxes will be abolished and replaced with a single-rate federal retail sales tax collected only once at the point of final purchase. Used items and business-to-business transactions will not be taxed."

So, everything you buy will be taxed by the feds. Want to move to a low tax state? Forget it! Want to have some level of local input into how you're taxed. Forget that too.

-- E.H. Porter (Just Wondering@About.it), April 10, 2000.

Mr Porter, could you elaborate on why the income tax is a good thing?

-- KoFE (your@town.USA), April 10, 2000.

First of all, my wages is not income in the correct sence of the word. In the law, income is defined as profit. I dare you to show me where the money I recieve for work done is profit. Now if I take that money and give it to XYZ Corp and they give me more back than I gave them I have made some profit and it is subject to tax.

The only thing this movement is going to do is get the corperations out of paying tax on the profit they make from the sale of goods. The reasion that this profit is taxed is as a cost of being allowed to conduct business. This country was set up for individuals and any corperate use comes as a special use.

Don't stop the income tax, just tax income.

-- Just passin through (nobody@nowhere.com), April 10, 2000.

KoFE -- not sure about that myself. Am willing to consider all options on the subject. I just don't like a National Sales Tax; by definition, you can't get away from it. One short term reason -- I buy a fair amount of stuff on the Net, which is now tax exempt and would be taxed on a National Sales Tax system. I'm also not sure how this National Sales Tax benefits us over the present system.

-- E.H. Porter (Just Wondering@About.it), April 10, 2000.

Considering that this nation has a NEGATIVE savings rate, I would say that one obvious benefit would be to encourage saving.

-- J (Y2J@home.comm), April 10, 2000.

The Constitution says that no direct tax shall be laid. A national sales tax is about as direct as a tax can get. It will never pass, because it is un constitutional!

-- ... (...@...com), April 10, 2000.

Unfortunately, the constitutionality of a law doesn't seem to matter much anymore. Try to own a handgun in New York City or Washington D.C. to see if your Second Amendment right is being upheld.

-- J (Y2J@home.comm), April 10, 2000.

The above mentioned site states that this is why we need the FairTax:

AFT proposes a new, fair, simple tax system. Under the AFT plan, all Americans, regardless of their income level, will be better off. Everyone will be subject to the same sales tax rate with no exceptions and no exclusions, and those least able to share in the cost of government will carry no federal tax burden at all. The AFT plan will increase individual purchasing power by eliminating... [various taxes]

It is also claimed that while "increasing individual purchasing power" and "making all Americans better off," the FairTax "will not decrease government revenue." I would be interested to hear how these apparently conflicting goals can be met.

-- David L (bumpkin@dnet.net), April 10, 2000.

The article said,

"Provide a universal rebate equal to the sales tax paid on essential goods and services to ensure that no American pays taxes on necessities. "

and

"Everyone will be subject to the same sales tax rate with no exceptions and no exclusions, and those least able to share in the cost of government will carry no federal tax burden at all."

While personally I like the idea of a flat tax, how is a national sales tax as the only tax NOT going to soak the poor? Assuming everyone needs about the same goods and services to live (not counting luxuries), if you make 10K per year and pay 1K in tax you'll be penalized 10% of your income. The same person making 100K only pays 1% of their income. This might be good for some, but fair?

Also, they say they won't tax necessities, but what is a necessity? In PA clothing is non-taxable, as is Toilet paper (but not tissues) whereas in CA all three are taxed. I'd bet as revenues start drying up the only things considered necessary are food and political contributions.

Oops, I just reread this part, "Provide a universal rebate equal to the sales tax paid on essential goods and services"

Why provide a rebate? To make people save their receipts for a year and see who doesn't, or is it to give everyone an account on their SSN without which you can't buy or sell? If something is a necessity why not just NOT TAX IT?!? (punctuation for Carlos)

Frank

-- Someone (ChimingIn@twocents.cam), April 11, 2000.

I'm one of those that goes back and forth on a national sales tax. On one hand, it seems to be a burdensome system on both businesses to collect and for the poor to pay, regardless of whatever rebate scheme is devised. On the other hand, it is the only way to collect taxes from the underground economy and, in particular, dope dealers. Then, as E.H. says, we lose more local control and our ability to control how much we pay in tases by moving to another place with a better tax rate. Like so many things in life, there's no easy answer to this in my mind.

-- Jim Cooke (JJCooke@yahoo.com), April 11, 2000.

Just Passin' You my friend have a grasp. Screw the Income Tax!!!The answer is simple,vote the republicons and the democreeps out and vote Libertarian,IMHO.Check it out.And Harry Browne has some good ideas.

http://www.lp.org/

-- capnfun (capnfun1@excite.com), April 11, 2000.

At a Federal Sales Tax rate of 15 percent, someone who earns $100,000 and spends $100,000 has an effective tax rate of 15 percent.

Someone who earns $1,000,000 and spends $100,000 would have an effective tax rate of 1.5 percent - one tenth that of the person who earns $100,000.

-- (retard@but.happy), April 11, 2000.

In New Zealand we have a national sales tax called GST (Goods and Services Tax) which is set at 12.5%. It is levied on all purchaces, whether for business or personal use, however registered businesses can claim a rebate if or when they on-sell a product.

As far as the effect on wage wokers is concerned, it doesn't replace normal income tax, which is levied at various rates depending on income, but supplements the income tax system.

It may appear unfair to those on lower incomes untill you examine just how income is spent. A person on a very low income will buy the cheaper items, (like an older model second hand car), while someone who is a high earner will buy a more expensive brand new one. In this respect it is very fair, as even if someone is able to hide their income from the IRS, it is much harder to hide their spending when all spending is taxed at source.

-- Malcolm Taylor (taylorm@es.co.nz), April 11, 2000.

The real problem with this sales tax thing is the burden still falls to the individual directly.

I have never been in favor of the progressive tax structure we have now as far as individuals go because a successful person has more (higher percentage) of the fruits of his labor taken by the state.

Corporations are the real winners in the sales tax thing as they appear to have to pay no tax on their profit. In the early days of this country, companys had the only real tax on their activitys and the individual was considered untouchable.

An indirect tax is one the individual never sees because it is levied on the business level and is added to the end cost of the goods being purchaced.

I suspect an attempt to capture the supposed lost revenue of over state lines catalog sales taxes as a motivating factor here. States have been whining about billions being lost to undisclosed catalog purchaces for years now. I think the amount is VERY overstated.

What does it matter if we vote down something thats illegal as the law stands now? And who but someone being paid by the current system is allowed to decide if its legal or not? Don't fall for it. Even Keyes is wrong as much as I prefer him to the other candidates.

A little disjointed looking but think I said what I wanted to for the moment.

-- Just passin through (nobody@nowhere.com), April 11, 2000.

This subject needs to be approached from the top down before we have a context within which the issues make sense. Otherwise, we get bogged down in details like geographically variable tax rates, internet purchasing, etc. So first, let's lay out some of the goals a very different tax system is expected to meet:

1) Revenue neutrality. Basically, this means the number of dollars in taxes collected by every level of government must not change radically all at once. We must presume that present government spending rates are a rough approximation of what we the people, considered all together, consider appropriate. Such rates should be fairly easily and incrementally changeable as we change our collective minds, and as circumstances change. So we're not looking at paying more or less in total taxes, only at paying them in a different way.

2) Efficiency. Currently, the tax system is inordinately complex, to the point where often enough no two tax lawyers (or IRS collectors) can agree on exactly what is owed. The US has had to create a regulation to the effect that what one IRS agent told you to pay is NOT an admissible defense if another agent decides you owe more! As a result, the economic cost of paying and collecting taxes is significant. This cost should be reduced drastically.

Another aspect of efficiency relates to the free market. Investment capital should be as free as possible to chase opportunities as they arise. The current system has the effect of locking capital into investments that are no longer as attractive as they used to be, since the tax levied on the process of moving this capital to better purposes often exceeds the possible gains from such movement.

3) Fairness. There is general agreement that the tax burden should fall equally on everyone, and be somehow tied to peoples' varying ability to pay. I don't have the numbers handy, but currently something like 5% of the people pay 90% of the total taxes. Again, this is an approximation of what we the people consider "equal burden" -- that Bill Gates can easily afford to pay $300 million a year in taxes, while the poor pay nothing (except sales tax, excise tax, FICA, etc.). Any new tax system should NOT increase the number of people living in poverty, and preferably reduce this number. At the same time, taxes on the very rich should not be so punitive as to drive them to change their nominal residence to the Cayman Islands or Monaco so as to keep some of what they make.

4) Reduced complexity. Current tax law fills many volumes. The number of different kinds of taxes is fairly extensive. There are excise taxes, sales taxes, property taxes, income taxes, capital gains taxes, import duties, taxes on profits, on and on. There is a vast number of exceptions, special cases, loopholes and the like. This should all be simplified a great deal. But...

5) Policy considerations. This category is nasty. Current tax laws are openly considered an instrument of policy. Their very complexity is an artifact of the political desire to encourage certain behaviors, discourage others, reward big campaign contributors, and attract votes from measurable voting subpopulations like the elderly. Like it or not, politicians will *always* meddle with even the simplest tax structure, in an effort to engineer preferential advantage for themselves, their constituents, and those who do what the politicians feel is best for them. Ideally, a new structure will make such constant micro-meddling more difficult.

6) Minimal transitional pain. Nearly everyone who has money has allocated that money at least partially with tax considerations in mind. As just a few examples, what is the effect on cities if municipal bonds lose their tax advantage? What happens to home buyers who no longer get a deduction for mortgage interest? What fate will charities suffer? Churches? R&D? 401(k) plans? Clearly a new system must be phased in slowly enough to permit people to adapt and prevent suddenwindfalls for some and catastrophes for others. So the political will NOT to meddle with the transition process (and end up with more complexity and less efficiency than we have now) must be sustained for some time. Right.

So OK, the ideal tax structure is easy to understand, greatly simplifies collection, requires little or no effort for compliance on the part of the public, maximizes the flexibility of capital, doesn't reduce anyone's effective purchasing ability significantly, and permits the government to fulfill the will of the voters at least as much as it does now. And we have to be able to get there from here fairly painlessly.

The major stumbling block we face is that currrent tax law is a byzantine maze of special considerations; a little something for everyone in one way or another. Nearly everyone agrees that (1) The current tax system is an expensive, unmanageable mess; but (2) The little something *I* get is sacred, and should be increased. No simple tax system is likely to withstand the political pressure to appease important voting blocs, solicit campaign contributions, discourage vices and encourage virtues, reduce poverty, provide many different safety nets, and so on. No matter what we do, the "improvement" will be highly debatable, the tradeoffs murky.

-- Flint (flintc@mindspring.com), April 11, 2000.