Taxes and Yes we Need them

As much as I have read and listened too, there has been progress that has made since on this subject expect to continue to continue.

The fairtax proposal will be wrong for the tax payer that pay the bulk of the taxes. The tax system we have today will not work and has never really worked.

I  propose a flat tax, based on gross earnings for the year, we pay the tax and there are no refunds or write offs of any kind it is one way. This flat tax will be on earned dollars for the year no matter how they are generated. With exception there will be no taxes paid on money left to families due to death, moneys generated from the orginal amount will be taxed.

All businesses- will pay a 5% flat tax on all moneys recieved for the year. There will be no business that will be tax exempt example: colleges, universities, chruches, or any non profit organization. All business taxes will be paid monthly.

For the individual tax payers this is and example

divide the taxs paid by these percentages

state:25% Fed: 25%, SS/Medicare 50% 

Personal earnings Flat tax for the year:

000-10k - 3%

increase the tax 1% per 10k to 210k

210k - 270k = 24%, 270k - 310k = 25%, 310k - 370k = 26%,

370k - 420k = 27%, 420k-470k = 28%, 470k - 550k = 29%

550k and greater = 30%

With this  flat tax a person with a gross earnings of $80,000.00 will pay $8,000 in taxes; $2K to state,$2k to fed, $4K to ss/medicare  (10%)

A person with  gross earnings of $47,000.00 will pay $705-state, $705-fed,and $1410 - ss/medicare (6%)

SS/Medicare will be removed from the general fund and the government will no longer be able to borrow against it, it has to run on dollars generated on the fed tax and what they receive from the states 

I beleive this will be fair to all tax payers, and the best way to boost our economy in the future. 

Please tell us all how the FairTax will be wrong for the taxpayer... It's named the FairTax for a reason....

Just think for one minute on exactly what it means to be taxed on what you spend. Also take another minute to think about what you have spent this last year on services and goods you have purchased just to live. Calculate the dollars you have paid on all those goods and services and what percentage of your gross income did it amount to. Then determine what tax percentage it would take on what you purchased to give the government just 10% of your gross earnings which they give back to you in services you don’t even realize the cost of those services.

Let’s compare my flat tax vs your fair tax. The average income for the United States is approx. $48,000. a year with a flat tax of  approx. 6% your total tax with no refunds just on wages alone is approx $2900.00. However someone making $200,000.00  @ flat tax 22% equals about $44,000.00 in taxes for the year. Each of these people will pay the same price for services and good they purchase. Lets say we will pay 50% of our gross income on goods and services. So we have $24,000 compared to $100,000.00. The Fair Tax will be the same for all that’s what’s makes it fair (fair for the rich) We will base the fair tax percentage on the person making $48,000.00 a year we will also assume that the government will want the same amount of taxes paid to do that we will say the percentage of tax applied as the fair tax will be 2900/24000= about a 12% fair tax. Now let’s apply that 12% to the person making $200,00.000  paying $100,000  their tax dollar liability will be $12,000.00. Now if I reversed this process to compute the fair tax using the required tax the fair tax will jump from 12% to 44% still (fair for the rich). The person making $48,000.00 will be overburdened still, as compared to the person making $200,000.00.

So the Fair Tax will land somewhere between 12% - 44% on what we purchase. You better think of what that truly will cost you if you fall in the mean distribution of the average income before you think it is fair.  

Man...you really need to go to the FairTax website...... You are by far the farthest off I have ever heard!

Oh well you only read what you wanted. I never said I wanted the projected flat tax base they have proposed and you jumped to a conclusion.

I stated that my proposed flat tax bracket would be used. 

I was correct on the fair tax range, the propose tav was the mean of my range.

If you truely believe that this is a fair tax, you probably believe that their program on ethanol was a great idea also.

GBA,

You have not met my wife or a politician.  Who spends only 50% of their income?  How do you define income?  Who will be responsible for reporting income?  Who will verify the income?  What will discourage a cash economy?

One of the problems with the income tax today and in the future when it is progressive or even flat, is that at the margin, people will work less since they have to pay more tax.  People will try to avoid taxation using legal and illegal means, just as they do today.  We are responsible for self reporting which is verified by employers for salary and wages, but other sources of income are invisible.  Banks fill the breech providing information on account transactions and spending habits.  The tax system and IRS are very un-American in that they represent an invasion of privacy and you are guilty until proven innocent.  Payroll withholding is also an undesirable characteristic of an income tax.  You pay the money before you ever see it and it has little meaning to you.  You don't miss it as much, because you never had it to begin with and as a result, you are less interested in how it is spent/wasted.

A flat tax would be an improvement over what we have today, but I doubt it would stay flat for very long.  An income tax is just a poor way of taxing people and it is not fair by any stretch.  It may be more equitable, but it is not more fair when one citizen is coerced to pay more than another for the same rights, privileges, and services.  It is simply redistribution of wealth or legalized theft, pure and simple.  A tax on income, especially with automatic payroll deductions creates the environment we have today, where half the country thinks their tax refund is a "gift" from the government when it really represents payback of a loan provided to the government without the benefit of interest.