posted
I was dismissing the notion there wouldn't be a price increase by seat of the pants calculations, which is perfectly reasonable. Furthermore, you've been talking about not seeing a single good counterpoint, when quite a few are still up in the air.
To see how I would rebut your post on lobbyists, allow me to first show you a quote of yours, then how I modify it:
quote:tax incentives, tax giveaways
quote:incentives, giveaways
The government is the single biggest spender in America. The existence or nonexistence of a corporate tax does not particularly decrease its ability to spread pork around, merely the means which are used.
There might be a short minor respite while lobbyists retool, but the reason the lobbyists exist isn't the tax code, its that the cost of corporations to get Congress to give them what they want is less than the opportunity cost of doing so. The elimination of a particular method is largely irrelevant, all that matters is if there are still sufficient avenues for it to occur.
Posts: 15770 | Registered: Dec 2001
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posted
And don't get all excited about companies bringing in their $$ by closing off shore tax havens. Instead they will be buying bulk purchases of goods from some small island nation's web-site based tax free economy. A ream of paper that costs $10 in the US suddenly goes up to $12.50. They can order it from Tiawan Paper Co for that $10, and if they order in bulk and get it shipped into the US for $1. Suddenly they are buying 20000 cases of paper from over seas.
Posts: 11895 | Registered: Apr 2002
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posted
So, they buy the paper, ship it here and have to pay the tax on entry, but how does the U.S. determine the value of the stuff to put the tax on accurately? Further, while it's pretty clear when large orders of things are being shipped into the country for businesse, what of the individual? Some one goes to fabulous Mehico and buys some stuff and comes back with it. At the border, he says it's a gift from his dear cousin, Pancho. What then? What of international orders over the internet shipped into the U.S.? In order to calculate the value to tax, the company in another country must be willing to go through the hassle of talking to the U.S. government, creating delays, etc.
Posts: 13123 | Registered: Feb 2002
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posted
The key question is: Can we make it 23% more costly to operate a black market? If we can, it won't be worth buying from a black market, and thus that problem will be minor. If we cannot, people will flee legitimate markets and head to the black market for lower prices. Right?
If we can fix this problem, I think the Fair Tax is an excellent idea. Given that the government costs a certain amount, we want to collect that amount as efficiently as possible, with as few negative side effects as possible. Right now I think we collect taxes in a horribly inefficient fashion.
The biggest benefit to the Fair Tax, I think, would be the emotional costs eliminated. By this I mean that it seems unfair and even painful to give away money we earn in taxes. That's a big reason why preparing taxes is so hated. I think it would be much easier to swallow a system in which you keep all the money you earn, but instead have to pay a sort of transaction fee whenever you buy anything in America. The resulting tax collected would theoreticly be the same, but it would feel like you are freely choosing to pay it each time you make a purchase, rather than having it taken from you. I think this emotional benefit would be very significant... in addition to the benefit of reducing paperwork.
I don't know why this is called the "Fair Tax" though. It would almost certainly be less "fair", given that the poor would probably still end up paying too much. It should be called the Efficient Tax, because it's really designed to be efficient, not fair.
Posts: 8120 | Registered: Jul 2000
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posted
I still don't understand, depending on the facts, why this is so much harder on the poor. If anything, from what I've read, it looks to be easier on the poor. You really think the poor are out there buying luxury cars and other high prices items? There's no tax on rent, or the basic necesities of life, or really many of the things they need.
I think this would help them to put some money away to help their kids have a better life.
Posts: 21898 | Registered: Nov 2004
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posted
Dagonee -- considering the EU employs a border bureaucracy which I think is far more massive than our own in order to handle the issue when it comes to VAT and agricultural products, I'm not so sure your faith that our current system can handle it is warranted. Right now we lose little money from inaccurate values placed on items brought into the country, but given a large effective import tax to keep goods competitive, expect constant efforts at things like forging bills of sales for foreign-purchased goods, on large scales.
And yes, Lyrhawn, there is a tax on rent under the bill:
quote:(14) Taxable property or service-
`(A) GENERAL RULE- The term `taxable property or service' means--
`(i) any property (including leaseholds of any term or rents with respect to such property) but excluding--
posted
That seems vague. It says rent on any property, except for used property. Does that mean if someone is living in an old apartment complex, rent doesn't count?
Posts: 21898 | Registered: Nov 2004
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posted
Tres: unlikely, on the black market thing, at least with this implemented as a sales tax. Its just too easy to circumvent with methods of dubious legality that are hard to catch on the one hand and prone to good ol' boy protection on the other. The EU has some moderately bad problems with black markets in places, and they've got a VAT, so its much harder to circumvent the markup.
Personally, I think the notion that a tax system should be absolutely simple and monolithic an appeal to pretty notions rather than practical application of theory. A mixed system is generally preferable, IMO (as we largely have, its just out mixed system is too complicated).
I could see a combination of a sales or VAT tax with a significantly simplified income tax system, actually, I could see that very easily. It'll never happen, though, because it can't be made into a soundbite.
Posts: 15770 | Registered: Dec 2001
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posted
I guess. The second you get past the sound byte though, it evaporates into misunderstandings. People not understanding the plan, people not understanding the current system.
Momentum for political gain alone won't do it. Until people understand even the basics of the current tax system, and then understand what the viable alternatives are, they will have a hard time getting through the disinformation to find a plan they like.
There is enough political gain available in doing it, if the plan is right. But there are so many people out there ready and waiting to discredit their enemies for trying something new that it's hard for anyone to dare take a step out of line without the fear they will be villified and will lose their seat.
I wish the President had chosen tax reform as his championed cause, rather than social security. Personally I think that is what it will take. Congress will never do it by themselves, they need a President looking to do good, or to secure his legacy, either way, no other voice is loud enough to get the ball rolling.
Posts: 21898 | Registered: Nov 2004
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Unfortunately, the general public is not interested in understanding the complexities of economics, or of any other law, and politicians are not interested in explaining them. When's the last, oh, mailing you got from one of your politicians explaining the nuances of an important bill and the practical reasons he or she had chosen to support of oppose it?
Posts: 15770 | Registered: Dec 2001
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posted
Last October. I usually get them every year just before the elections. They cover bills they've voted for, things they plan to vote for, and things that should never be voted for.
So when do you give up all together? War has had a shortlived effect on the majority of the country. Terrorists attacks, the same. The people don't care in large numbers about understanding the economy or foreign policy, which are arguably the two most important things when it comes to determining the course of the country's future.
Instead they are fixed on scandal, venom filled rhetoric, where the commandments can be displayed, what we teach in science class, so on and so forth. Important issues? Sure, they deal with the fabric of the nation. But the most important things that determine our future prosperity? No.
And there's no signs that ANYTHING can possibly get the country to care about it.
At what point do you honestly give up?
Posts: 21898 | Registered: Nov 2004
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posted
Really? All the ones I get avoid making any serious analysis of a bill and generally lay out positions based on talking points, you must have a much better set of politicians in your area.
I deal with the situation rather easily, myself, I just don't think it necessary for "the country" to care for such things
There's a reason specialization occurs; I'm not arguing for a meritocracy, just that as much as it sometimes irks me, I'm comfortable with a system where most of the people decide on sound bites in blissful ignorance of any but the broadest notions of what the person being voted for will do in office.
Posts: 15770 | Registered: Dec 2001
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posted
I haven't gotten to that state yet. I'm stuck on insane frustration with the country.
Maybe a couple years out in the "real world" and away from college will beat the idealism out of me.
My problem is that we used to care, as a country, and somewhere between the generation of my grandparents and now, we stopped. I like to believe that as a person, I can still make a difference, but the reality is that I can't. I can only reach so many people, most of whom will ignore me, and of those that do care, they already have their minds made up and will either agree with me or villify my.
I've gotten away from the point of the thread I guess, but the whole thing is just depressing me to the point of a hissy fit on the general state of things in America. Feel free to ignore this part. Posts: 21898 | Registered: Nov 2004
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posted
No, I'm not aware of any period where, as a country, the populace in general seriously cared about the nuances of even one bill.
Posts: 15770 | Registered: Dec 2001
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posted
I can think of a couple dozen. But then, I'm a history major, it's my homework to know that kind of stuff.
Posts: 21898 | Registered: Nov 2004
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posted
Sorry to dig this up (if anyone minds) but I want to see if anyone can convince me how a Retail Sales Tax would be better than a VAT. I read the first three pages of this thread, but I've got to go soon, so I've skipped the rest to ask this.
This is how the GST (our VAT) is explained. As I see it, it makes a very small difference to the price of products and services. The main difference is that GST better focuses on B2B transactions. If you introduced the prebate (poverty lines time 0.1) I could see this being better than the FairTax, and certainly the (every other) tax system it replaced.
Posts: 1138 | Registered: Nov 2005
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1) A VAT hides the actual amount being taxed. Remember, the consumer pays all the tax on what they buy, whether they know it or not. If a company has to pay taxes during the creation of a product, they pass that cost on to the consumer. Every time you see corporations being taxed, you're being taxed; not the corporations.
To repeat, taxes on B2B transactions are paid, ultimately, by the consumer, but without the visibility that a retail sales tax has.
2) The FairTax will not go into effect without a repeal of the income tax. Countries that have implemented VAT have often done so in addition to an income tax.
The savings in eliminating the whole income tax structure are enormous. On the order of a quarter of a billion dollars each year.
Posts: 12266 | Registered: Jul 2005
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