Reading the tax panel’s final report on their recommendations for tax reform, reminded me of a group of smokers who give all the reasons why not to smoke then they all light up another cigarette.
I am one of the millions of Americans who is in favor of a national sales tax to replace our outrageous income tax. If you read the comment section on the tax panelâ€™s website, (www.taxreformpanel.gov) you will see just how strong Americans feel towards the FairTax. I canâ€™t believe the tax panel didnâ€™t come up with a proposal that is worth while. What a joke!! What a waste of time!! They didn’t come close to following the presidentâ€™s outline. Iâ€™m sure they are aware by now that 99.9 percent of Americans are outraged by their proposals. A public conference call was scheduled the day before they were to give their recommendations to the president. At the last minute, they cancelled the call. This proves to me that they could care less what the American people think. At least they should listened to the well know economists who recommend the FairTax. Over 80 economists, some from major universities have signed an open letter to the president recommending the FairTax. You can read this letter by going to the FairTaxâ€™s website at http://www.fairtax.org click on Scorecard then click on Economists Fair Tax Letters of Endorsement. Even Alan Greenspan suggested that a National Sales tax would give our economy a tremendous boost.
At the end of their presentation they have all these charts used to explain why they are not considering the FairTax. What a farce! Here are just a few things they forgot to factor in when doing this false presentation.
#1 Elimination of embedded taxes and compliance costs
#2 Elimination the 15.3% withholding tax for S.S. and Medicare
#3 The millions of dollars of additional revenue the current system is unable to collect from criminals, cheats and illegal aliens.
#4 Economic growth the FairTax would create
#5 Balance of trade the FairTax would create
No matter how you crunch the numbers, the FairTax is a better deal for all. The same dollars will be collected as with the income tax, but with the FairTax, we will have a better handle on government spending. No more smoke and mirrors as with our current system. This being the case, we will be more dedicated to the cause for reducing government spending.
One of the many ways our income tax system creates smoke and mirrors is with the corporate tax. If corporate taxes were eliminated, our country would be more competitive internationally, and more jobs would be created. If this is the case, why is their a corporate income tax? Taxing corporations is just a means of passing the tax on to the American people without us realizing it. If corporations weren’t taxed, individuals would have to make up the difference. Our tax rates would jump 20% to 25%. We would be upset, right? But guess what, we already pay these taxes. Every time we buy a product or service, we pay the embedded taxes and compliance cost for every company involved in producing and selling that product or service. By hiding these taxes in products and services, we won’t make waves. This keeps us off Washingtonâ€™s back. The question is; which is better for our country, trying to fool the American people or making our country more competitive and productive? The average American is becoming smarter and more informed. In the past, most Americans, including myself, just complained about our unfair, complicated, outrageous tax system, but smoke-and-mirrors wonâ€™t work mush longer.
One day I asked my son how much he paid in income taxes last year. “Dad I didnâ€™t pay anything, I actually got about twenty bucks back.” He is one of many Americans who has been brainwashed by the good old withholding tax, another smoke and mirrors tactic.â€ I said, son I know you received a refund, but how much Federal tax did you pay? â€œOh, Iâ€™m really not sure, I think my tax man said I was in the 15% tax bracket, I just know a got some money back.â€ I said what about the 7.65% that comes out of your check for S.S. and Medicare. Oh, thatâ€™s right, I forgot about that. Again, good old withholding smoke and mirrors. Then I said what about all the corporate taxes you pay every time you buy something. â€œDad, I only pay sales tax, what do you mean corporate taxes?â€ I went on to explain that about 20% of the cost of every product and service we buy is for the taxes and compliance cost that are passed on to us from all the companies involved in producing and selling that product and service. This was a true eye-opener for him.
I said son, would you be in favor of a plan that would allow you to keep 100% of your paycheck plus it would pay you an additional $491 each month? Would you be in favor of this plan even if you had to pay 5% to 10% more for everything you would buy? â€œI personally think the actual increase in prices will be less once the embedded taxes and compliance costs are removed but, I will go along with 5% to 10%â€ I think you can guess what his answer was. The actual withholdings from his paycheck for 2004 was a little over $8000. By adding the $491 per month prebate; the amount a family of 4 would receive, to this figure, he would have had an increase in spendable income of $13,892 for the year. Oh, Iâ€™m sorry, I forgot to deduct the huge $20 refund he received. An additional $13,872 would almost cover his mortgage payments. My son is an average wage earner. No one can tell me that the Fair Tax will hurt the middle income American.
Under our current tax system, there are millions of American who do not pay their fair share of taxes. All those who avoid paying taxes because of loopholes, and cheating will have a tougher time doing so with the FairTax. With an income tax, you can cheat on your own. With the FairTax it will take two to tango; the buyer and the seller. With our current tax system billions of tax dollars is lost through loopholes, false deductions, and criminals not filling at all. With the FairTax, a drug dealer will have a tough time avoiding taxes when he buys his new Mercedes. With the FairTax the tax burden will be divided among millions more taxpayers thus reducing the burden on the honest people who are currently paying their fair share.
Also the Fair Tax is the only plan that completely un-taxes the poor. Because of the prebate, anyone earning the poverty level or less will pay no tax. With our current system, even if someone has no income tax liability, S.S. taxes and Medicare are still deducted from his paycheck, and he still pays the embedded taxes and compliance cost when he make a purchase. It is my conclusion that anyone against the Fair Tax is either a tax Lobbyist, tax attorney, a criminal, or an illegal alien.