9-9-9 Plan

October 5, 2011  ·  Filed under: Education, News, vs. Flat Tax

Herman Cain 9-9-9 plan… what do you think?

  • Current circumstances call for bolder action.
  • The Phase 1 Enhanced Plan incorporates the features of Phase One and gets us a step closer to Phase two.
  • I call on the Super Committee to pass the Phase 1 Enhanced Plan along with their spending cut package.
  • The Phase 1 Enhanced Plan unites Flat Tax supporters with Fair tax supporters.
  • Achieves the broadest possible tax base along with the lowest possible rate of 9%.
  • It ends the Payroll Tax completely – a permanent holiday!
  • Zero capital gains tax
  • Ends the Death Tax.
  • Eliminates double taxation of dividends
  • Business Flat Tax – 9%
    • Gross income less all investments, all purchases from other businesses and all dividends paid to shareholders.
    • Empowerment Zones will offer additional deductions for payroll employed in the zone.
  • Individual Flat Tax – 9%.
    • Gross income less charitable deductions.
    • Empowerment Zones will offer additional deductions for those living and/or working in the zone.
  • National Sales Tax – 9%.
    • This gets the Fair Tax off the sidelines and into the game.

Posted by Morph  ·  Trackback URL  ·  Link
 
70 Responses to “9-9-9 Plan”
  1. Overall I think it’s a good start to move in a direction that provides certainty for the economy – individual citizens as well as businesses.

    My concern is will it provide enough revenue? I don’t mean does it provide enough revenue to balance Washington’s spending……I’m talking about adequate revenue to cover what’s essential in at the Federal level. Of course that’s an entirely different discussion.

    John Bailey  ·  Oct 7, 2011 at 12:40 pm  ·  Permalink
  2. I seriously doubt the numbers would come close to working.

    Think about it. On average, people currently pay 15-20% of their incomes in federal income and payroll taxes. (Not sure if that counts ‘both sides” of the payroll tax or not.) Cain’s plan will reduce that to 9%.

    Corporations pay up to 35% tax rate (and that’s BEFORE they distribute dividends to shareholders.) Cain’s plan would reduce that to 9% (AFTER they distribute profits to shareholders).

    Is a 9% national sales tax really going to make up the difference in lost revenue? I seriously doubt it. Particularly since he’s also getting rid of capital gains taxes and the estate tax. This is a tax plan only a billionaire could love.

    Hayden Kepner  ·  Oct 7, 2011 at 12:58 pm  ·  Permalink
  3. Well, I know the first liar doesn’t stand a chance, but here is a back of the envelope estimate of the revenue that 9-9-9 would raise.

    (1) 9% sales tax. I used $14 trillion as the current GDP, and adopted the Kotlikoff/BHI assumption that a sales tax base could be 81% of GDP. So, 9% of $11,340B = $1020 billion.

    (2) 9% Corporate tax. Corporate profits currently run about 12% of GDP. So, 12% of $14 trillion is $1680B, and 9% of that is $151B.

    (3) 9% individual income tax. I assumed that retail sales equals individual income because our savings rate is basically zero. So, with retail sales of $9.5 trillion, the individual flat income tax would raise $855 billion.

    Add $1020B, $151B, and $855B, and the total 9-9-9 revenue comes to an estimated $2018 billion. That isn’t far from being revenue neutral, but it is only 14.5% of GDP. Keeping in mind that federal revenue averaged 18% over the last 50 years, 9-9-9 seems to be a bit low. And I’m unclear about just what Herman’s empowerment zones do to the revenue raised. As John pointed out, the proper federal share of GDP is a subject for more discussion. Maybe 14% is right, but that isn’t even half of the current bloated federal budget. Big problem there!

    Please don’t hesitate to criticize my methods or assumptions. Or perhaps provide better data. It was the best I could do on the back of that envelope. There are still many unanswered questions about Herman’s plan which could significantly change the results. Stay tuned!

    Hank Van Gieson  ·  Oct 8, 2011 at 8:40 am  ·  Permalink
  4. Hank — That’s not a bad back-of-the-envelope analysis. I certainly don’t support the 9-9-9 plan (or Herman Cain), and I’m sure the numbers won’t hold up to actual scrutiny, but that’s the best analysis I’ve seen so far. Maybe you can send it to a talking head somewhere.

    Hayden Kepner  ·  Oct 9, 2011 at 7:23 pm  ·  Permalink
  5. Bruce Bartlett’s take on the 9-9-9 plan.

    http://economix.blogs.nytimes.com/2011/10/11/inside-the-cain-tax-plan/?hp

    One thing he points out is that the plan would really blast the poor. Under Cain’s plan, the poor would pay 9% of their income in federal taxes (no exemptions) PLUS 9% of their spending (no prebate). In addition, since employers would not be able to deduct wages and salaries from the new 9% corporate tax, employers would necessarily keep wages as low as possible. So, this plan would seem to be a total disaster for working folks.

    Hayden Kepner  ·  Oct 11, 2011 at 8:05 am  ·  Permalink
  6. I need to revise my estimate of the revenue that Cain’s 9-9-9 plan would raise. My error was assuming that retail sales should equal income assuming that we save nothing. However, I overlooked the fact that retail sales can be paid for by not only income but also accumulated wealth, and current savings are around 5%. Wrong approach!

    With the help of the Bureau of Economic Analysis, I now estimate that wages and salaries, both government and private sector, amounted to $6408 billion in 2010. A 9% income tax would raise $577 billion.

    Here is a summary I am now quite comfortable with:

    (1) 9% sales tax: I used $14.5 trillion as the current GDP, and adopted the Kotlikoff/BHI assumption that a reasonable sales tax base could be 81% of GDP , or $11,745B. So, 9% of $11,745B = $1057 billion.

    (2) 9% Corporate tax: Corporate profits currently run about 12% of GDP. So, 12% of $14.5 trillion is $1740, and 9% of that is $157B.

    (3) 9% Individual Income tax: Wages and salaries, both government and private sector, amounted to $6408 billion in 2010, according to the BEA. A 9% tax would raise $577 billion.

    Add them up and total revenue from the 9-9-9 plan comes to $1791 billion, far short of the 2010 federal revenue of $2163B. And, Cain’s proposed “empowerment zones” would only make the disparity worse. Granted, this is a simple static analysis, and Cain is claiming his analysts used a dynamic analysis. It seems to me that his ten year dynamic analysis results are heavily dependent on growth and other assumptions used?

    I also agree with Hayden and Bartlett that the lower income folks would get screwed. Cains argument that the 9% income tax and the 9% sales tax would be largely offset by a 15% increase in pay from eliminating FICA is certainly debatable. I don’t see the employer share of FICA winding up in the employees pocket. Stay tuned!

    Hank Van Gieson  ·  Oct 11, 2011 at 2:26 pm  ·  Permalink
  7. Does Cain’s plan tax government spending? If not, then it won’t tax 81% of GNP.

    Also, talk about regressive. Look at the following analysis:

    1. Laborer. Family income of $30,000/yr. Spends 100% of after-tax income.
    Fed. Income tax: $30,000 x 9% = $2700.
    Fed. Sales Tax: $27,300 x 9% = $2457.
    Total Federal Tax: $5157, or 17% of income.

    (And, of course, state income, sales and property taxes will have to be paid out of the remainder.)

    2. Doctor. Family income of $300,000/yr. Spends 50% of after-tax income.
    Fed. Income tax: $300,000 x 9% = $27,000.
    Federal Sales Tax: $136,500 x 9% = $12,285.

    Total Federal Tax: $39,285, or 13% of income.

    3. Heiress. Family income of $1,000,000 (all capital gains). Spends 50% of after-tax income.
    Federal Income Tax: $0
    Federal Sales Tax: $500,000 x 9% = $45,000.

    Total Federal Tax: $45,000, or 4.5% of income.

    So, the richer you are, the lower your effective tax rate. Poorer families would pay an effective tax rate of over three or more times as high as the very rich that get most or all of their income from inheritances and capital gains.

    Hayden Kepner  ·  Oct 11, 2011 at 7:35 pm  ·  Permalink
  8. Hayden,

    I like that – Regresssive is a good thing.

    Anyway, Cain has come out of the closet to tell us that 9-9-9 (I love Hunsman’s line that he thought Cain was bringing out a special on pizza) is nothing morfe than the “Fair Tax” in drag. He will keep 9-9-9 only until he can explain the Fair Tax to us idiots.

    In the meantime, he gives the Devil yet another tool.

    The bottom line is that Herman Cain is trying to shove down our throats a massive increase in the welfare state (“Prebate”) which even Charlie Rangel choked on at the House Ways & Means Comm Hearings on the Fair Tax. Cain is either a closet Socialist, or his research is very faulty.

    What is this “empowerment zone” nonsense welfare.

    His Income Tax MUST have a full credit for ANY Sales Tax paid so people don’t pay BOTH!

    Stephen C. Eldridge  ·  Oct 12, 2011 at 2:52 pm  ·  Permalink
  9. Re #5 w.r.t Under Cain’s plan, the poor would pay 9% of their income in federal taxes (no exemptions)

    Actually, Cain’s 999 plan does exempt charitable contributions from income.

    John Bailey  ·  Oct 13, 2011 at 8:43 am  ·  Permalink
  10. To: John Bailey

    I did not read Bartlett’s report, but you did not mention Cain’s (incorrect) point that the poor really do not get hurt that badly. That is Cain said the poor save 15.3% in Payroll Taxes – that may be correct, ion effect, ONLY if you assume that employers will increase their salaries by the amount of the employers’ share of those taxes ( very dangerous assumption.

    Thus, the Income & Sales taxes paid by the poor under 9-9-9 will be reduced by 7.65% and their taxes must be levied to make up for the lost employers’ 7.65%.
    Theoretically, if employers give all their savings to employees, employees will effectively get 15.3% to offset their 18% combined Income & Sales Tax, so they will pay very little – we still need tax revenues to make up for the lost employers’ 7.65% (look in the mirror to see who will make that up).

    In any event, the Republic will not survive if 1/2 of the people pay no tax but can assail weak Congressman to give them someone else’s money.

    Stephen C. Eldridge  ·  Oct 14, 2011 at 7:12 pm  ·  Permalink
  11. From my understanding, payroll taxes are on the amount one has earned from the employer. If that is so, in order for your statement to be ‘true’, the employer would have to decrease one’s pay, not increase. The point is, the payroll tax is on money the employee has already earned, thus Herman Cain’s 9 – 9 -9 plan allows the employee to keep those earnings as opposed to paying it in taxes. The poor would save 15.3%, thereby having the ‘extra’ to spend on necessities – this is helping the poor, not hurting them. I’m not sure about the ’empowerment zones’ and will do further research. My guess is that the less we pay up front in taxes, the more we are empowered to spend as WE see fit, not restricted by the over-taxing government. This increases revenue as well. One thing people seem to be forgetting is that the bulk of the IRS will be eliminated, saving our government how much $$$?

    Lisa  ·  Oct 15, 2011 at 1:16 pm  ·  Permalink
  12. Stephen re:#10

    I didn’t read Bartlett’s report either. I could care less about Cain’s correct or incorrect point regarding how the poor are hit. It’s irrelevant.

    Those who dislike the plan whine about how it hurts the poor because they will be paying 18% of their income (9% in income taxes) and 9% in sales tax which is essentially another 9% income tax because they spend all their income. Both of those points are not entirely accurate. They may or many not pay 9% in income tax, as they do get to deduct charitable contribution. Almost 100% of the people above-poverty-but-considered-poor people I know personally give at least 10% to the church. Such a contribution would bring the income tax burden down to 8.1%. The argument about paying the rest of their income in sales tax is also extreme. Will some? yes. All? no. Not all good are taxable. There are a large number of places to purchase used goods (clothing, furniture, cars, etc.).
    The question I have is in regards to the taxableness (is that a word?) of services.

    I do not claim that the 9-9-9 plan would not result in a significant tax increase for low income earners as the vast majority of them don’t pay anything other than payroll taxes and even a non-trivial percent of those individuals get that back in the form of tax credits and such thus having either 0 total tax liability (income and payroll) or a negative total tax liability (they get money back).

    What would the sales tax percent need to be to collect the same anticipated revenue if food goods were exempt (as is the case for most or all state sales tax plans)? Is there a simple way to exempt low income earners from having to pay the sales tax? Would it be more palitable to provide a minimum threshold for the income tax under which the earner would not be taxed? If so, what would be a reasonable income limit and the income tax rate that goes with it? I think the Flat Tax folks have that about a $36,000 income threshold for a family of 4 (or something like that).

    John Bailey  ·  Oct 17, 2011 at 8:20 am  ·  Permalink
  13. John,

    I am not sure what you are getting at and I have learned more details as they leak out.

    The “poor” will pay more tax – which I say is a very good thing (we won’t survive with 1/2 pay zero or negative taxes but can lobby for more of our money – do you agree?

    The poor will get no raise because the employers’ share of of P/R taxes 7.65% would be replaced with a business tax of 9%, effectively, because it has no deduction for wages (except in Empowerment Zones). So, the poor pay 9% Sales Tax + 9% Income Tax (maybe on only 90% of their income and maybe less for “used” items) – I think services are subject to the sales tax.

    Thus, I think the poor will pay more tax. There should not be any exemptions from their Income Tax nor Sales tax to insure that they do pay some tax.

    Stephen C. Eldridge  ·  Oct 19, 2011 at 10:38 am  ·  Permalink
  14. Stephen — At least your consistent. I agree with the general principle that everyone should pay at least SOME taxes to the federal government, but not many people would admit to supporting a tax system in which the poor pay a higher percentage of their income in taxes than do the rich. Though I think that was probably the case in France in the 1780s and in Russia in the 1910s. Didn’t work out too well for either of them if I recall.

    Hayden Kepner  ·  Oct 19, 2011 at 1:54 pm  ·  Permalink
  15. Stephen,

    I’m quite in favor of everyone paying something. I don’t think I would go as far as agreeing with you that everyone should pay the same dollar amount, but everyone paying the same % of income would be something I could go for.

    I hate to admit it, but I am in some agreement with Hayden in that it would be difficult, if not impossible, to muster wide support for a tax plan where low income people pay a higher portion of their income on taxes than the rich.

    John Bailey  ·  Oct 20, 2011 at 7:57 am  ·  Permalink
  16. HAYDEN & JOHN,

    I should think that I have other qualities in addition to consistency. Consistency is a good thing – unless, of course, one is in the wrong.

    You both keep coming back to (what I consider to be) a superficial criterion of the “RATE” of tax paid by the poor & rich. Why do you limit your analysis solely to the RATE of tax?’

    Why aren’t DOLLARs of tax far more relevant. The rich man pays far more DOLLARS in tax than the poor man (one of Buffet’s many deceptions).

    Recall my “America-is-really-a-coop” analysis – why should one member pay more than any other coop member? if one can’t afford that coop building one must find one he can afford.

    Why should Buffet pay more DOLLARS for his military protection than you do? Is it just because he can AFFORD to pay more dollars? Willie Sutton was justified in robbing banks, because “that’s where the money is”.

    Stephen C. Eldridge  ·  Oct 20, 2011 at 3:44 pm  ·  Permalink
  17. From my Summary:
    Apparently, about a year ago, Cain criticized the idea of adding a sales tax – that was when he was pushing the FT, before FT was trashed by the House ways & Means Committee. Now, he can only get to FT by easing us into 9-9-9.
    Having 3 taxes will make it easier for the rascals in Congress to raise our taxes (rates, exemptions, surcharges, etc., etc., etc.). Taxpayers know this – Cain does not.
    It is really a 9-9-9-9 tax. Because the business flat income tax does NOT allow a deduction for wages (unless paid in an “Empowerment Zone”) business, effectively, pays a 9% payroll tax.
    Cain chides the critics for not seeing the finer points of his plan, but that is because he is very slow to provide details, wherein the devil resides.
    Cain recently explained that the business flat income tax allows a deduction all equipment purchases (no messy depreciation) and also allows a deduction for all of its purchases of goods from US located businesses, but apparently no labor costs, except in “Empowerment Zones” (is a deduction allowed for services provided by non-employee US Independent Contractors?).
    Apparently, Cain does not allow a deduction for imports but does allow a deduction for net exports (net of imports?). If this does not run afoul of international trade rules specifically, it will generate retaliatory responses from other countries – shades of Smoot-Hawley tariffs which helped in great measure to bring on the Great Depression.
    Taxing the Poor:
    The Republic cannot survive when half the people pay no tax, but can be “community organized” to coerce a weak Congress into giving them more of someone else’s money. While 9-9-9 begins to address that problem by in fact taxing the poor, Cain falsely defends his plan against those who criticize it for doing so.
    Note above, business effectively pays a 9% Income Tax on wages because it can’t deduct them, but saves its 7.65% share of current payroll taxes. Thus business is behind by 1.35% which may reduce future raises.
    The poor save their share of payroll taxes (7.65%) but now pay both a 9% Sales Tax and a 9% Income Tax (except for “Empowerment Zones”). Thus, the poor pay 10.35% more in tax (unless they make purchases on the new American Black Market) – Cain explains only that the poor get a reduction from 15.3% (both employer & employee share of payroll taxes) down to 9%, which is misleading because the employer will not give the employee a raise because it now pay a 9% effective tax on payrolls) and the employee pays 18% not 9%.
    I reject any new sales tax. Any such tax must not exempt purchases of the poor and there must be no FT-like “Prebate” welfare check to offset any tax they pay and give them a welfare check to boot.
    The Individual Flat Income Tax must not provide a welfare check as does the current law’s Refundable Tax Credits – -“Empowerment Zone” benefits are a start in the wrong direction.
    General:
    The Individual Flat Income Tax must provide a full CREDIT for any Sales Tax paid, in order to prevent the “rich” paying both the Income Tax AND the Sales Tax. Items of “Taxable Income” must be substantially cleaned up. It has some sort of “poverty” deduction for those in “empowerment zones” – i.e., “Welfare”.
    Sales Tax: The pitch made that the transparent sales tax will replace the hidden “embedded taxes” has been established as a myth – there will be no significant price reduction.

    Stephen C. Eldridge  ·  Oct 20, 2011 at 3:48 pm  ·  Permalink
  18. Under the 9-9-9 plan, new goods are taxed at 9% and so are services. Where do things such as rent, electricty, water, phone fall? Are all considered taxble? Is paying rent considered a new expense or service?

    John Bailey  ·  Oct 20, 2011 at 4:19 pm  ·  Permalink
  19. John,

    Cain has not revealed many details.

    I understand (Fox News) that Stephen Moore of the WSJ helped him craft 9-9-9 and now that there is so much pushback on the sales tax, that he may replace it with a 9% payroll tax- I wrote to Moore and explained that there was already a 9% tax on payrolls, effectively, because (except in Empowerment, now Opportunity, Zones) payrolls are not dedeuctible for purposes of the 9% Business Flat Tax.

    Stephen C. Eldridge  ·  Oct 20, 2011 at 6:26 pm  ·  Permalink
  20. 9-9-9 Brochure
    9-9-9 Scoring Report
    9-9-9 Scoring Tables

    Morphh  ·  Oct 20, 2011 at 8:54 pm  ·  Permalink
  21. Stephen,

    I agree Cain’s details are sparse. While I want everyone to pay something in tax, I don’t want to increase taxes on low income to such a high percentage.

    To answer your question as to why we are concerned with the rate……because a dollar to someone making over $100,000/year is less significant than a dollar is to someone making less than $20,000/year. My father who is a retired minister (not one of those TV evangelicals, but a small town preacher) is concerned about saving a quarter where as I won’t put much thought into spending an extra quarter.

    I think if we shrunk the size of the beast…..err I mean Federal government, then rates would be reasonable to the point that even a flat tax might be palatable to the low income.

    John Bailey  ·  Oct 21, 2011 at 5:51 am  ·  Permalink
  22. Morph,
    Thanks for posting the links. I read looked at them the other day. I like Hermain Cain and am inclined to vote for him in the primary, however, I quickly got lost in the scoring report. I couldn’t tell if it was supposed to be an evaluation of taxation or an explanation of his plan or a derivation of his plan. I concluded it was meant to be an explanation of how his plan was developed. Regardless, I found it confusing.

    Also, I wish they had provided source links to where the data came from. I attempted to extract excerpts of it to post here in an effort to illustrate how Cain determines it’s revenue neutral (to contrast it against Hank’s estimate above). But either I was too distracted with life around me or it was not clear enough to me for me to feel confident that I was doing it justice in my interpretation.

    John Bailey  ·  Oct 21, 2011 at 5:57 am  ·  Permalink
  23. Here is a quick analysis of 9-9-9 by Kotlikoff. A Fair Accounting of Herman Cain’s 9-9-9 Tax: Laurence Kotlikoff

    Morphh  ·  Oct 21, 2011 at 6:24 am  ·  Permalink
  24. John re # 21`

    I understand WHY you are focused on the RATE, but challenge your limitiong the relevant considerations to the RATE.

    Yes, to a man making over $100,000 $1

    Stephen C. Eldridge  ·  Oct 21, 2011 at 8:49 am  ·  Permalink
  25. Joghn re # 21

    Sorry- Yes, to a man making over $100,000, $1 of tax is less significant than it is to a man making $5,000. But so what. Don’t you see that you are makling the IDENTICAL argument that Willie Sutton makes, when he robs banks because they have money (and does dot rob poor people who don’t).

    Whether it is easier or not to pay a bill, the poor man has a “fair” share of the bill (which I define on the “scientific method”). Once you start to politiocally redistribute wealth (by re-distributiong each persons fair share of the bill for the military) you begin the progressive march towards Socialism/Communism.

    We must start with Constitutional PRINCIPLES and DISCIPLINE, if the Republic is to survive.

    Stephen C. Eldridge  ·  Oct 21, 2011 at 8:54 am  ·  Permalink
  26. Morph,

    Can tell this old Luddite how to provide people a reference/link to the 3 items in post # 20? I am making a few presentations on FT & 9-9-9 and want to give the audience as much resource material as I can locate.

    Stephen C. Eldridge  ·  Oct 21, 2011 at 8:58 am  ·  Permalink
  27. To ALL;

    It now appears that Cain’s Income Tax will be zero for those below the poverty line.

    Has anyone found this yet (it is most annoying that Cain keeps criticizing analysts who don’t read his plan, when he has been keeping all the details to himslf).

    Also mentioned was a “Tax Policiy Group or Comm analysis – anyone seen it.

    Stephen C. Eldridge  ·  Oct 21, 2011 at 11:26 am  ·  Permalink
  28. To ALL:

    I have located the author of the Tax Policy Center article, at the Urban Institute in DC.

    I am awaiting clarifications.

    Is there a Poverty Allowance or not – Cain just said yes. I found something like it on the Fiscal Associates paper Morphh provided but can’t find it in the explanation of the 9-9-9 plan. This is maddening that Cain is so elusive on just what the heck is in this plan – he pooh-poohed the details, but we all know that the devil truly reside in the details.

    Stephen C. Eldridge  ·  Oct 21, 2011 at 12:18 pm  ·  Permalink
  29. I don’t think Cain has explained many details in his 9-9-9 plan because I doubt if he understands the details himself. He was a right-wing radio host for a few years in the Atlanta area. In my opinion, he didn’t bother to much with details and, in particular, couldn’t be concerned with facts or analyses that did not fit into his pre-determined narative.

    Hayden Kepner  ·  Oct 21, 2011 at 1:42 pm  ·  Permalink
  30. I watched a detailed 9-9-9 speech by Cain from Detroit at noon today. I think I learned that for the poor, the plan is 9-0-9 with no individual income tax for those below the poverty line. But, the poor would still have to pay the 9% sales tax on all new goods and services, I guess. So, they get an increased paycheck due to no more FICA which is 7.65%, and pay the 9% sales tax on a lot of their purchases. Probably a wash for the poor.

    For everyone else, payroll would be double taxed, once as a business expense, and again as employee income. Except for those pesky empowerment zones, where Cain said businesses would get to deduct some, not all, of their payroll expenses. Anyone want to go live in Detroit?

    As for my simple analysis found in #6, I’m going to stick to the result, even though I overlooked the Cain proposal to tax all business payroll, not just profits. My reasoning is that all workers would become independent contractors very quickly in order for businesses to deduct purchased payroll expenses. Lots of implications about what that might cause! I still believe that 9-9-9 is far from revenue neutral.

    Hank Van Gieson  ·  Oct 21, 2011 at 3:17 pm  ·  Permalink
  31. Herman Cain Announces ‘9-9-9‘ is Actually a ’9-0-9? Plan for those at Poverty Level
    It sounds to me that the 9% flat income tax exempts income up to the poverty level defined by family size – same method the FairTax uses in determining the prebate amount. This would make the personal income tax progressive, instead of proportional, and is more in line with most flat tax proposals.

    Morphh  ·  Oct 22, 2011 at 8:57 am  ·  Permalink
  32. You can find some materials on the poverty level allowance in the Fiscal Associates, Inc papers – I think it is a little less generous than the Prebate.

    I am saddened to learn again that so many of you out there believe in Progressivism/Socialism. Will you never see that having half the people pay nothing, but able to coerce Congresss to give them more of someone else’s money, will eventually destroy our Republic. And, protecting the poor from paying taxes only breeds more poor people.

    Stephen C. Eldridge  ·  Oct 26, 2011 at 7:57 pm  ·  Permalink
  33. Stephen, it seems there is more than one truth here to evaluate. You have the best option for economics – minimal economic disruption. You have the best option for liberty and our republic, as you describe. You have have what is politically feasible and desired, based on public support. Unfortunately, these often conflict, so we’re left trying to find a balance. Sure, we could grand stand on one particular ideal, but that’s not a solution.

    Morphh  ·  Oct 27, 2011 at 6:53 am  ·  Permalink
  34. Morphh,

    As one wise man descrtibed America, we are not two wolves and a sheep taking a vote on what to eat for dinner.

    We are not a Democracy where the mob rules – we are supposed to rtespect the rights of the minority.

    Of course the numerous “poor” outnumber the wealthy, but oue founding principles do not permit them to confiscate that wealth because they have the overwhelming number of votes to do so. They can vote to turn our Republic into a Marxist state.

    Stephen C. Eldridge  ·  Oct 27, 2011 at 6:58 pm  ·  Permalink
  35. Stephen — I am just curious. If you lived in a third world country where the richest one percent of the population owned more wealth than ninety-percent of its citizens, would you still advocate your tax plan — where the poorest of the poor pay the same dollar amount in taxes as the richest of the rich?

    And if those ninety percent voted instead for a progressive income tax system, such as what we have had in this country for the last century or so, would you really believe that they were turning their country into a Marxist state?

    Hayden Kepner  ·  Oct 28, 2011 at 8:48 am  ·  Permalink
  36. Hayden,

    Yes, that would be the beginning of a Marxist state, which begins with an inncocent sounding DEMOCRACY, wherte 99 wolves vote on devouring the 1 sheep for dinner.

    OUR REPUBLIC does makes us all EQUAL BEFORE THE LAW (not in life’s outcomes).

    OUR REPUBLIC is supposed to respect the rights of the minority – the mob shopuld not devopur the minority.

    My plan of equal tax dollars for ewvery single citizen is the ultimately correct tax, notwithstanding that it is politically far far down the road – iot is the ideal that we must work towards.

    Your approach punishes success, rewards failure and promotes more failure (successful stealing and looting only bring on more of such negative behavior – it is addictive).

    Stephen C. Eldridge  ·  Oct 28, 2011 at 11:29 am  ·  Permalink
  37. I am surprised to find such disinformation on 9-9-9 posted on a Fair Tax blog!

    1. 9% Income tax. This is lower than the 15.3% payroll taxes people pay now. Yes we can assure this savings goes to employees. According to the scoring report … there is a Poverty Grant that would exempt or refund the taxes paid up to the poverty level ($15K for the average family).

    Even IF … we let the employers keep their share of the payroll taxes… since the first $15K would be exempt … using the formula .09(X-15000) = .0765X … you find that you have to make $110K (new limit) before the 9% income tax equals the employee share of the current Payroll tax.

    2. Sales Tax.

    As Fair Taxers you should know that this is not a new cost to consumers. Retail prices already contain 22% in embedded taxes. Prices can stay about the same as they are now even after applying the Sales tax whether it is the Fair Tax or this 9-9-9 tax.

    This is a very good deal for the middle class and poor.

    Stephen,

    Yes it is progressive… but on the bright side … People will now actually see the Cost of Government on the receipts of the things they purchase. Today people who pay no income taxes think they only pay the 7.65% payroll taxes … so they are always in favor of tax increases on the “Rich” (those who do pay income taxes).
    They do not realize that that THEY are paying the 7.65% their employers pay … Plus they are paying 22% embedded in the prices of items they purchase.

    They are paying 37% … 15.3% payroll taxes plus 22% embedded… but they don’t realize it! 9-9-9 will make part of this Cost of government VISIBLE. Later the Fair tax will make 100% of the cost of government visible.

    How likely do you think people will be to vote for wasteful government spending after their eyes are open to the fact that THEY are paying for it?

    Vince Natrella  ·  Oct 29, 2011 at 9:05 pm  ·  Permalink
  38. Vince,

    I hardly know where to begin (I have an appoimtment and will continue later today).

    Your First paragraph: No, the employers’ share will absolutely NOT go to the employee. Before even considering employers’ discretion as to what to do with their savings (7.65% of payroll) you must understand that the employer saves NOTHING – he is behind. That is, for purposes of calculatring the Flat Business Tax, SALARIES are NOT DEDUCTIBLE (except in Opportunity Zones) so that the employer is effectively BEHIND by 1.35% of Payrolls.

    Your 2nd Paragraph: “Even IF … we let the employers keep their share of the payroll taxes” – who is we, comrade? It woud not be up to you, but to the employer.

    I have not seen this $15,000 exemption you mention – please educate me. In response to criticism, Cain has mentioned some kind of family allowance against the Income Tax, but this is not relevant to the point.

    Stephen C. Eldridge  ·  Oct 31, 2011 at 8:35 am  ·  Permalink
  39. Vince,

    Welcome to the Fairtax blog where even Fairtax cult members who drank too much Kool-Aide are treated politely.

    (1) 9% income tax. First of all, the Cain 9-9-9 plan is really a 27% tax on income. 9% when payroll is taxed as a business expense, 9% when your individual pay is taxed as income, and 9% when you spend your pay on goods and services. 27% effective tax on your income. Is that fair?

    And just how do you propose to force businesses to give their share of FICA to the employee? The odds of that happening are somewhere between slim and none. That is a business expense and when FICA payments are eliminated, the money will remain with the employer, not the employee. How else can employers contain the costs of the payroll tax?

    (2) Sales tax. Yes, we are very familiar with the impact of the Fairtax on retail prices. And, most of us plus the Director of Research at Fairtax.org, understand that retail prices will rise by 15-17% under the Fairtax. Turns out that two thirds of Jorgenson’s 22% average embedded tax costs were employee income tax and payroll contribution withholding. Jorgenson assumed that we would accept a huge pay cut in order for businesses to get maximum cost reduction. Not going to happen for legal, contractual and fairness reasons which we have discussed in detail. As long as Fairtaxers claim that we all will get 100% of our pay/pensions, retail prices have to rise.

    As for the 9-9-9 plan, here is a rough estimate of the impact on retail prices. The 9% business tax can be boiled down to a 9% tax on profits similar to current tax law, and a 9% tax on payroll. According to the BLS, payroll in 2010 was $6 trillion, so a 9% payroll tax would cost $540 billion. That is $105 billion more than businesses pay as their share of FICA. Average business income tax on profits currently runs about 3.2% of sales. Under the 9-9-9, the tax on profits would be three times as large. Triple the tax on profits, throw in another $105 billion net on payroll, and add the 9% sales tax and it would seem obvious that retail prices are going to have to rise under the Cain plan if businesses are to retain the same profit margin.

    As for your note to Stephen, he can and will speak for himself, but you are badly misusing the concept of embedded taxes. The only thing embedded taxes impact is retail prices, not our individual tax burden. Even Prof. Kotlikoff, a former Fairtax advocate, has written that claiming that embedded taxes affect individual tax burdens is incorrect. Business prices include taxes, rent, payroll, insurance, etc. and a host of other expenses. But none of those expenses impact my personal expenses other than as they apply to retail prices. And I think I have shown that even under 9-9-9, retail prices are going up. And, 9-9-9 does not contemplate a “prebate” so the poor are going to catch it in the neck unless his “empowerment zones” works out.

    Finally, if you think the Fairtax is transparent, please consider the fact that HR25 proposes to tax State and Local government consumption. While that would probably be found to be unconstitutional under our Republican form of government, if approved by the Supreme Court, 10-15% of the federal revenue raised would be hidden in the higher S/L taxes needed to pay the federal tax bill. How transparent is that?

    Hank Van Gieson  ·  Oct 31, 2011 at 8:41 am  ·  Permalink
  40. Vince, many of the voices here are against the FairTax. So you’ll get a mixed audience for or against such tax plans.

    Hank, I still completely disagree with your second to last sentence. I thought we had proven this accusation as false. Even Stephen did the math and came out with similar results, although he doesn’t believe in the whole real/nominal thing. State costs would decrease in real dollars. If I remember correctly, what we have now is state costs hidden in the federal tax bill.

    Morphh  ·  Oct 31, 2011 at 9:30 am  ·  Permalink
  41. Morphh, Please remind me of any data on the subject of S/L taxes. I took a simple (minded?) approach which used the 2007 Kotlikoff/BHI “What Rate Works” study data. Kotlikoff showed that the S/L contribution to the Fairtax taxable base was around $1.1 trillion, and S/L salaries were 41% of that total. The only savings to S/L governments under the Fairtax would be their $35B in FICA payments. (1100B x .41 x .0765 = 35B). So, the States reduce costs by $35B and then pay the 23% sales tax on $1100B, for a net increase in costs of $218B or 23%. The States can (1) raise all taxes; (2) Reduce all services; or (3) “tax the tax” which goes against one of the Fairtax goals regarding cascading taxes. It’s not rocket science, so please tell me where I’ve gone off the rails!

    Thanks!

    P.S. By the way, I wasn’t thinking of Vince as a member of the Fairtax cult. I thought he checked in as a 9-9-9 advocate. And I was somewhat tightjawed over the last couple of days, having been banned from the Fairtax.org Facebook blog for trying to get at the facts. They are still arguing about whether or not government payrolls are to be taxed, and whether or not the prebate is an entitlement. Sad! If I owe Vince an apology, please accept it. No harm intended!

    Hank Van Gieson  ·  Oct 31, 2011 at 2:38 pm  ·  Permalink
  42. Vince,

    Forgive me for not welcoming you the the group discussion. We have people both pro and con he “fairtax” who debate civilly, ecven if we poke each other sometimes.

    First, was I clear enough in my first response to you so that you can understand that Employers are under water by 1.35% of payrolls and thus will be in no mood top even consider giving employees any share of hos former payroll taxes.

    Next, lets move onto your Sales Tax comment. “”22% Embedded Taxes” – the FT economist Dale Jorgensen explained that prices will NOT drop if employers give employees their full (gross) pay, thus many of us believe that prices will come down no more than a few percent. Same principle on 9-9-9.

    Yes, people will see the non-transparent tax and they will REVOLT over an in-your-face combined federal/state sales tax of 30-40% at a minimum.

    People don’t vote for wasteful spending – Congress does.

    May I suggest that you go to this site’s “Fair Tax-Related research” tab on the home page and then look at the bottom of the list of Papers for the “Unpublished Papers” section where you will find, Replacing the Income tax.

    Stephen C. Eldridge  ·  Oct 31, 2011 at 3:26 pm  ·  Permalink
  43. Hank (& all),

    I thonk Herman has resaponded to criticism and is now proposing a 9-0-9 tax, for the poor that is, via a big family exemption – msee Fiscal Associates paper that Morphh sent us earlier, abopve. So, it won’t be 275 for the “poor”.

    It has also been called a 9-9-9-9 plan, the 4th 9 being bthe effective vtax on payrolls, becasue payrolls are not deductiblem for purposes of the Flat Business Income Tax.

    Stephen C. Eldridge  ·  Oct 31, 2011 at 4:30 pm  ·  Permalink
  44. Morphh,

    I am confused (that is not surprising since I am old and had much wine with dinner.

    I thought some of us (not you) believe that prices will go down somewhere between 0-10% (based in part on the FT’s Dale Jorgensen’s explanation). So we think that NET, states will have to pay some FT and will look to us idiot taxpayers for more state taxes to pay it. The federal govt can do so in more indirect ways; i.e., print more $ (tax us via inflatyiopnb) or borrow and payn it off over a long period of time with more money from us.

    I do not understand your last sentence – please explain.

    Stephen C. Eldridge  ·  Oct 31, 2011 at 4:36 pm  ·  Permalink
  45. Here is the information that I described, updated with a correction Stephen had suggested during our conversations.

    The Cost on State and Local Government

    Morphh  ·  Oct 31, 2011 at 7:59 pm  ·  Permalink
  46. Morphh,

    Now I am confused. Earlier this evening, you put up an interesting exchange from two and a half years ago on the subject of the Fairtax impact on S/L governments. Truthfully, I couldn’t understand my own responses, but I don’t think we ever agreed on that issue? I made a copy of the entire 13 pages, and will spend some time trying to refresh my memory–if it’s still in there? Where did that exchange go, just out of curiosity?

    Hank Van Gieson  ·  Oct 31, 2011 at 9:08 pm  ·  Permalink
  47. Sorry Hank, you’re quick.. only had that up for like 5 minutes. I’m tweaking the numbers and adding in some additional info. Stay tuned.

    Morphh  ·  Oct 31, 2011 at 9:57 pm  ·  Permalink
  48. Ok.. I updated it some, though the numbers are pretty significant in favor of the FairTax – a lot more than I was expecting. Like you, I had to reread it again. haha I double check the figures, and they look right to me, but I’m sure we can hash that out. :)

    Morphh  ·  Oct 31, 2011 at 10:10 pm  ·  Permalink
  49. Ok, I found the error that had the numbers skewed, which I realized after re-reading one of Hank’s comments in the other thread (18). The total needs to be the baseline plus taxes paid, minus gains.

    Morphh  ·  Nov 1, 2011 at 7:26 am  ·  Permalink
  50. fellows,

    I ask for your constructive criticism on a “fair tax” point.

    I keep getting hearing FT peddlers shouting down my Illustration of the Prebate, with the same tired old rants “but the IRS is abolished ( a lie)” and “but now the criminals pay tax”
    (so that supposedly, that justifies a great expansion of the welfare state).

    I knew instinctively that SOME tax would be paid by criminals, but that the other 300+MM Americans would now attempt to pay as little tax as possible. I have tried to make that more concrete with the following illustration, for which I ask your criticism to see if it hits the mark.

    Using the BHI rough estimates, I believe they said that gross FT spending would be about $12T. They then subtract about $2T to account for lost tax revenue due to the Prebate and leave about $10T NET for FT which x 23% yields their target of about $2.3T.

    To restate, total spending is about $12T. Critically, THIS INCLUDES SPENDING BY CRIMINALS WHO HAVE PAID NO INCOME TAX. Thus, whatever % tax avoidance one applies, the target revenues will suffer (e.g. if you assume a 20% tax avoidance rate, target revenues will fall short by $460B. This would clearly demonstrate that “criminals would now pay tax” is grossly misleading – they would now pay SOME TAX but any tax avoidance by other taxpayers ovcerwhelms any tax criminals might pay.

    Stephen C. Eldridge  ·  Nov 4, 2011 at 7:49 am  ·  Permalink
  51. Stephen — This whole idea of “Criminals will finally pay taxes under the FairTax is nonsense.” They won’t pay anymore in taxes under the FairTax than they do today. Here’s the analysis:

    Under the FairTax:

    A drug dealer sells $100,000 in drugs. He’s supposed to collect and remit the FairTax to the federal government. He doesn’t. (At a 23% “tax-inclusive rate, the government loses $23,000 in tax revenue.)

    The drug dealer then goes out an buys an expensive Cadillac for $100,000. The Cadillac dealer collects the FairTax and sends it to the federal government. So the government gets $23,000 in taxes (less the amount the dealer keeps for collecting the tax, which I think is .5%.) And, if the drug dealer is a U.S. citizen, he will get the prebate, which will reduce the net tax paid to the government.

    Under our current income tax system:

    The drug dealer sells $100,000 in drugs. He’s supposed to pay income taxes and self employment tax to the federal government. He doesn’t. So the government loses this tax revenue. (Let’s assume, for the sake of this discussion, that the total tax he should have paid was $23,000.)

    Now, the drug dealer goes to buy a Cadillac for $100,000. The Cadillac dealership pays income taxes on the sell. The salesman pays income taxes and payroll taxes on his commission. The manufacturer pays corporate income taxes and payroll taxes. The parts manufactures pay income taxes and payroll taxes, and their employees pay income taxes. Etc., etc. This is what the so-called “embedded taxes” are, which the FT folks claim equals 22% of the price of the Cadillac. So, the federal government gets $22,000 in tax revenue from the sale of the Cadlillac from these “embedded taxes.”

    Ergo, the FairTax is not going to collect anything more from the underground economy than does our current tax system. The whole premise is flawed.

    Hayden Kepner  ·  Nov 4, 2011 at 8:27 am  ·  Permalink
  52. Stephen,

    The actual figures from the BHI study show that taxable spending was $11,244B, the prebate allowance was 2112B, the adjusted Fairtax base was $9355B and the revenue to be replaced was $2288B. The actual rate was therefore 23.82%, or $76B short of the revenue neutral goal? BHI went on to describe the $76B shortfall as “just 2.73% of non Social Security spending, a remarkably small adjustment”? Round these numbers off any way you want to in order to make it simple, but I prefer 11,2,and 9 so that the revenue neutrality goal is clearly not met.

    As for criminal spending, my blood pressure rises when Fairtaxers claim there is a $2 trillion underground economy, and try to make us believe that somehow taxing the individuals who run that operation will somehow generate lots of revenue. The taxes paid by a pimp for taxable goods and services(?) under the Fairtax won’t begin to offset the untaxed income he makes.

    I certainly agree that evasion by all of us could dwarf any increased revenue received from the underground economy masters. In fact, I worry more about legal tax avoidance than illegal evasion. If avoidance isn’t a problem, then why is the super committee rumored to be ready to propose a “chained” method of calculating COLA’s? Such a method, rather than just inflation, takes into account the changes in buying habits as prices increase. Hamburger, rather than steak! That is legal tax avoidance.

    Hank Van Gieson  ·  Nov 4, 2011 at 9:36 am  ·  Permalink
  53. Hayden,

    The 23% FT will likely exceed the true “embedded taxes” of under 10%.
    Now suppose the drug dealer now buys his Mercedes in Mexico and drives it over the border (I don’t think he has to pay any state sales tax/FT to register the car in the US).
    He will reduce his taxes rather than increasing them.

    In that case, is my theory correct, that crmininals will have to pay some FT on things they must acquire and consume in the US but that gain will be more than offset by “honest” Americans all avoiding as much FT as they can.

    Stephen C. Eldridge  ·  Nov 4, 2011 at 5:30 pm  ·  Permalink
  54. Hank,

    Could you expand on your point starting with the 3rd sentence of your last paragraph?

    Stephen C. Eldridge  ·  Nov 4, 2011 at 6:20 pm  ·  Permalink
  55. Stephen —

    1. I agree with you that the “embedded taxes” are not anywhere near 22%, but you won’t get a FairTaxer to admit that. Thus, in your discussions with the FairTaxers, you can simply point out that if the embedded tax is, in fact, 22%, we won’t get anything more from the drug dealers under the FairTax than under our current system.

    2. According to Boortz, if you buy something in another country to avoid paying the FairTax and bring it into the states, you will have to pay a 23% duty on it. If so, the Mercedes bought in Mexico would be taxed when brought back into the states. (Query – If the drug dealer sets up an LLC as a front, and buys the Mercedes, whether in Mexico or the US, it should be tax free. Of course, that doesn’t directly relate to his selling drugs, except that I can pretty much guarantee that every drug dealer would set up an LLC in order to buy whatever he wants tax free.)

    3. Also, drug dealers are more likely to buy things for cash under the table to avoid paying the FairTax, and the people they do normally do business with will do the same thing. Probabaly not the Mercedes dealer, but the restaurants and bars he frequents, his landlord, the prostitutes he visits, ect., are all going to take cash.

    4. And, yes, even if the drug dealer does have to pay the FairTax for some of his purchases, the amount realized by the government will not come close to the amount of tax revenue lost by tax evasion and avoidance (and simple changes in comsumption habits) practiced by everyone else.

    Hayden Kepner  ·  Nov 4, 2011 at 7:48 pm  ·  Permalink
  56. I will have to research the Statute to see if that car would be subject to a 23% tax when brought into the US.

    If I can summarize to assure my understanding, the drug dealer was paying up to 23% on his legal purchases (via embedded taxes) and now will seek to avoid FT likely paying less FT than prior “embedded taxes” (especially if they were 22%).

    To that I add my basic point that even if they paid a little more under FT, that would be overwhelmed by the tax avoidance of the other 300+MM Americans avoiding some amount of FT.

    Stephen C. Eldridge  ·  Nov 5, 2011 at 7:25 am  ·  Permalink
  57. Stephen,

    HR25 clearly states that the Customs Agents are charged with collecting the 23% sales tax on everything that is shipped into our country. I have no idea what kind of workload that might create, but we ought to take a look at it. Does every box, barrel, and 8x8x40 foot shipping container need to be opened to verify the contents? It sounds like an incredibly difficult task to me. Plus, if Customs collects the tax, then the retail merchant doesn’t have to–if he can figure out the tax trail? What a mess!!!

    As for the “chained” method of computing COLA’s, the news recently reported that the 12 member “super committee” has at least agreed on changing to the chained method which would save $60 billion over ten years. Small stuff, but it’s a start on the $1.4 trillion goal.
    Just using the annual inflation factor to compute COLA’s has clearly resulted in an excess rise in entitlement payments. The chained theory claims that personal buying habits adjust to price increases. I don’t know how the chained estimate works, but if it passes, stand by for a reduced COLA annually. And, while everyone understands inflation numbers, no one understands how the chained method works. Look for a lot of confusion.

    Hank Van Gieson  ·  Nov 5, 2011 at 7:58 am  ·  Permalink
  58. Stephen, et al.

    For all you never wanted to know about the chained method of calculating COLA’s, go to http://www.bls.gov/cpi/cpisupqa.htm

    Hank Van Gieson  ·  Nov 5, 2011 at 1:16 pm  ·  Permalink
  59. Hank (and all),

    Thanks, I will check that out. I would hope that lower COLA’s would be paired with lower increases in monthly medicare premikuym increases, just like the fact that for 2010-11 there was no SS COLA and premiumks foir those starting medicaree pre-2010 was not raised from $96.40/mo.

    ps. Just to report on a Tea Party Tax Reform presentation I made last night (I will be making several), the crowd LOVED my plan, YOUR SHARE!

    Stephen C. Eldridge  ·  Nov 5, 2011 at 8:10 pm  ·  Permalink
  60. I am a student at IvyTech and i believe it is time to tax everyone the same. Our current system is a mess and reform is the only answer.

    Fair Tax Guy 2  ·  Nov 12, 2011 at 12:38 pm  ·  Permalink
  61. I am a current student attending Ivy Tech Community College in Sellersburg, IN we are studying the pros and cons of the fairtax.

    9-9-9 ends the payroll tax but will this eliminate the IRS? I like the 9% Individual Flat tax & national sales tax.

    FairTax Guy24  ·  Nov 13, 2011 at 10:44 pm  ·  Permalink
  62. I am a student at Ivy Tech Community college doing some research on the FairTax act.
    There are arguments that can go for either side of the coin, some Pro and some Con. One Con is that The Fair Tax does nothing to solve the underlying cause of high taxation, which is excessive government spending. As long as the federal government keeps spending taxpayer dollars on things that it has no business being involved with in the first place, it will continue to require high taxes in order to finance its expenditures, including the increasing cost of the national debt. Simply changing the method of taxation is not going to change the root causes of unfair taxes. A Pro is that Federal income taxes would be completely abolished. According to Fairtax.org, this would include all ancillary taxes on personal income such as estate, gift, capital gains, alternative minimum, self-employment, Social Security, Medicare, and payroll taxes.

    FairTax Guy 1  ·  Nov 15, 2011 at 9:28 am  ·  Permalink
  63. I am a student at Ivy Tech Community college doing some research on the FairTax act.
    From what I have studied so far I do not agree 100% with the Fair Tax law, but I think that people should not become violent over the subject and instead should just argue peacably with each other.

    FairTax Guy 1  ·  Nov 15, 2011 at 9:50 am  ·  Permalink
  64. To Fair ax Guys # 1, 2 & 24.

    If you go to the “Fair Tax-Related Resrearch” limk on this website’s home page, you will link to Morphh’s comprehensive liust of Papers on this subject.

    At the end of that list is a sectionb, “Unpublished Papers” (for those of us who do not work at a scholl or think tank, but have lived in the business/professsional world) and you the only Paper in that group is mine, “Replacing the Income Tax”. I have extensively footnoted my Paper with references to several of the “Published” papers on that list – you can call me with any questions, comments or assistance.

    Stephen C. Eldridge  ·  Nov 18, 2011 at 1:24 pm  ·  Permalink
  65. To: fair Tax Guy # 2

    “Tax everyone the same” ???????

    “poor” people pay nothimg NET, i.e. we pay them even more than we do now.

    The “same” ???????? the guy who spend $1MM (pre-tax) pays (before Prebate) $300M. The guy who spend $10 (pre-tax) pays only $3,000 (before Prebate) — how is that the “same” to you???????? (that they pay the same tax RATE is on mildy relevant, but the huge difference in their bottom line tax burden is what’s relevant.

    Stephen C. Eldridge  ·  Nov 18, 2011 at 6:20 pm  ·  Permalink
  66. To: Fair Tax Guy # 2 re my post # 65

    I was tired: the guy who spends only $10m (NOTG $10) pays only $3m.

    Stephen C. Eldridge  ·  Nov 18, 2011 at 7:59 pm  ·  Permalink
  67. Is the Fair Tax Act really fair? Is the current tax process the true cause of the problem? There is no doubt that there are flaws with our current tax system, but from the info that I have gathered, there are just as many flaws with the Fair Tax Act. Maybe there are some root factors that caused the current system to come into question. I think the government’s wild spending should be the first factor to be evaluated. Then we should look at our own spending. How many of us buy houses, cars… you name it, that we truely cannot afford? These are just a couple off the top of my head.

    FairTax Guy8  ·  Nov 27, 2011 at 9:43 pm  ·  Permalink
  68. “9-9-9 The Movie: Slaying the Tax Monster”

    Morphh  ·  Nov 28, 2011 at 10:46 am  ·  Permalink
  69. 9-9-9 (or 9-0-9 OR 9-9-9-9) is nothing more than a smoke-screen for the so-called “FairTax”.

    To promote it as “THE” (Income) Tax slayer is disingenuous.

    Stephen C. Eldridge  ·  Nov 28, 2011 at 9:30 pm  ·  Permalink
  70. ‘I really hate this so-called Tax…

    Alexis  ·  Jan 20, 2012 at 12:04 am  ·  Permalink