On Dec 9 2007, 7:56 pm, Tim Daneliuk wrote:
Charlie Self wrote:
On Dec 9, 11:17 am, wrote:
J. Clarke wrote:

SNIP

Not sure that penalizing them for deficit spending is necessarily a
good idea. Sometimes that helps the economy.
This is arguable. The government produces nothing, hence cannot
add to the GDP. But even if it did so, the Federal Government
has no Constitutional authority to "help the economy".

Step Three
----------
Instantiate a flat tax like the Fair Tax via a Constitutional
Amendment that forbids the institution of *any* other kind of tax.
So no protective tariffs on foreign trade even if other countries do
enact such tariffs?
Right. Tariffs are yet another attempt to "manage" economics.

The "Fair Tax" proposal seems to be a 23% sales

tax, which is a "soak the poor" scheme.
Go reread it. It does no such thing. It rebates *everyone* the
amount of money a "poor" family would pay in taxes. This means
the truly poor pay no taxes.

Basic problem: the poor have to lay out
the 23% and wait for the
rebate, and some are at a marginal level
that does not allow paying
23% out. They are already paying only
whatever the local sales tax is,
and not much, or anything, else, so, for
example, a 5% sales tax state
would see the poor paying the further 18%
out-of-pocket, when their
pockets are already empty. When is the
rebate made? Instantly? Will
that work?

Monthly, in the form of a stipend check to each and every taxpayer.



All these flat tax and simple tax ideas work
nicely on paper. I'm not
at all sure they will work any better in practice
than the horrendous and untrackable mishmash
we already have. Then again, if a few simple
objections, as above, can be answered, they
sure as hell cannot be worse.

Of course they would work better. Do you spend *any* significant
amount of time/money/effort to pay your state or local sales taxes?

Merchants do. And the costs of that time and effort are
passed onto the consumer (in essence, a hidden operating
tax) by way of higher prices for the merchandise.

I'm not clear on how forcing (at the point of a gun,
no doubt) every merchant to be a pro bono tax
collector for the Federal government is any more
moral or even efficient than requiring the taxpayer
pay the government directly.

If more efficient, it is only because some state and
local governments already force (again, at the point
of a gun no doubt) to collect THEIR taxes for them
gratis.


This is no different. It abolishes the IRS and places the burden
of collection on the *seller* of goods/services who already has
the capacity to do this because of said local/state taxation
systems. Moreover, it taxes the underground economy - evendrug
dealers buy Ferraris, for example.

How naive. The underground economy relies heavily on
unreported cash transactions. No sales tax is collected.
One time a person selling me a used car offered to falsify
the sale price on the paperwork to save me taxes. There
was nothing in it for him--he thought he was doing me
a favor.

It is indeed fairer, simpler,
cheaper to administer, and has all kinds of other indicidental
benefits (like making markets more efficient by eliminating
capital gains taxation).



It comes with it's own host of problems and the only
reason why sales tax is not currently as big a mess
as income taxes is because the rates are still small
enough to not inspire the same degree of evasion
as does the income tax.

--

FF