The ?Fair tax? can only be passed incrementally

Supposn · Sep 3, 2010

The “Fair tax” must be enacted incrementally

I’m a proponent of replacing income tax revenues (to the maximum feasible extent with a federal sales tax, (i.e. the “fair tax”.

I doubt sales tax of 23% could replace all federal income taxes and I do not believe the U.S. Congress would attempt to transfer our overwhelming majority source of federal revenue in a single step. It’s conceivable they’d pass transformations accomplished by incremental steps.

Due to imbedded hidden sales taxes from prior transactions within a conventional sales tax method, a 23% sales tax would result in a significantly greater amount of actual sales taxs paid by purchasers at the final links of commercial transactions chains.

[The European Common Market nations and most other nation’s that have since then enacted or modified a sales tax, have adopted the “value added tax”, (VAT) method of sales tax because the total amount of government revenue realized from any chain of commercial transactions never exceeds the total sales taxes paid by all purchasers within all of the chain’s links].

The majority of states have their own sales taxes and additionally many cities and counties within those states also levy sales taxes. For example NY City’s total state and city sales tax is in excess of 8% and other states have similarly high tax rates. A 23% (conventional) rate would be a total sales tax exceeding 30%. Purchasers within the final links of transaction chains will pay high rates within many U.S. states. Even if a 23% a rate should be acceptable to the U.S. Congress, I do not believe it will be sufficient to replace all federal income taxes.

Respectfully, Supposn

Ignoramus · Sep 4, 2010

Supposn said:
The "Fair tax" must be enacted incrementally

Supposn said:
I?m a proponent of replacing income tax revenues (to the maximum feasible extent with a federal sales tax, (i.e. the "fair tax".
I doubt sales tax of 23% could replace all federal income taxes and I do not believe the U.S. Congress would attempt to transfer our overwhelming majority source of federal revenue in a single step. It?s conceivable they?d pass transformations accomplished by incremental steps.
Due to imbedded hidden sales taxes from prior transactions within a conventional sales tax method, a 23% sales tax would result in a significantly greater amount of actual sales taxs paid by purchasers at the final links of commercial transactions chains.
[The European Common Market nations and most other nation?s that have since then enacted or modified a sales tax, have adopted the "value added tax", (VAT) method of sales tax because the total amount of government revenue realized from any chain of commercial transactions never exceeds the total sales taxes paid by all purchasers within all of the chain?s links].
The majority of states have their own sales taxes and additionally many cities and counties within those states also levy sales taxes. For example NY City?s total state and city sales tax is in excess of 8% and other states have similarly high tax rates. A 23% (conventional) rate would be a total sales tax exceeding 30%. Purchasers within the final links of transaction chains will pay high rates within many U.S. states. Even if a 23% a rate should be acceptable to the U.S. Congress, I do not believe it will be sufficient to replace all federal income taxes.
Respectfully, Supposn

Puzzled. I haven?t seen a logical argument by which consumption taxes, especially those which tax food, are fair. VATs are efficient and hidden, which is the preferred mode of taxation. The social orders which implement VATs can be fairer than some, and in Europe, a bit more so then the American system.
There may be a subset of consumption taxes which are fair, but so far I haven?t seen any evidence of it in your proposal. Before calling your system a fair tax, could you submit an argument to establish that it is fair? Actually, when you call something fair in a social context, you set a utopian standard. It?s impossible to be fair in the social context, possible to be fairer, but fairer than what?

Supposn · Sep 4, 2010

Value Added Tax; (i.e. VAT sales tax method).

Ignoramus said:
............ VATs are efficient and hidden, which is the preferred mode of taxation.

Ignoramus, VAT is efficient but it is not hidden. Sales taxes are conspicuously itemized within the sales transaction. Unlike any other sales tax method I?m aware of, the value added tax, (i.e. VAT) contains no imbedded or hidden additional sales taxes passed on from previous transactions.

Of all sales tax methods I?m aware of, VAT?s the least intrusive, the most amiable to businesses and least susceptible to evasion or fraud. No other sales tax administration method is less expensive (to administer) and less invasive than VAT.

VAT in particular and all other sales tax methods in general are less expensive (to administer) and less invasive than the taxing of commercial entities incomes; (but of course their tax rates differ to be revenue natural).

Similar to other sales tax methods, Vat authorizes qualified sellers to collect the tax on behalf of the government; BUT the sellers immediately deduct any VAT they have previously paid for their own purchases BEFORE passing on only the difference to the government. This almost immediate refund of sales taxes paid is a significant cash flow benefit that commercial entities appreciate.

Within a VAT chain of commercial transactions the total explicitly itemized sales tax paid by any purchaser within any individual link of the chain is the government?s entire tax revenues thus far paid within that chain. This remains true from the first to the last transaction link of the chain.

The price within the intermediate or final transaction links of any commercial chain of transactions include imbedded and hidden within that price for all of the sales taxes levied within any previous transaction links. The difference of prices and government revenues between Vat and conventional sales taxes are dependent upon the amounts and the numbers of transaction links occurring prior to the final link of any chain of transactions.

It is certain that the aggregate New Jersey?s imbedded and hidden additional amounts of tax revenue must be significantly greater because NJ?s 6.9% sales tax is not a 6.9% VAT.

Respectfully, Supposn

Supposn · Sep 4, 2010

What is more equitable?

Ignoramus said:
Puzzled. I haven?t seen a logical argument by which consumption taxes, especially those which tax food, are fair. VATs are efficient and hidden, which is the preferred mode of taxation. The social orders which implement VATs can be fairer than some, and in Europe, a bit more so then the American system.
There may be a subset of consumption taxes which are fair, but so far I haven?t seen any evidence of it in your proposal. Before calling your system a fair tax, could you submit an argument to establish that it is fair? Actually, when you call something fair in a social context, you set a utopian standard. It?s impossible to be fair in the social context, possible to be fairer, but fairer than what?

Ignoramus, there is no tax that is fair but individual tax methods can be comparatively more or less equitable. What?s equitable is a subjective determination.

Philosophy is a method or system of concepts. Mathematics is the most objective philosophy, politics and economics is more subjective and less objective than mathematics.

I did not choose the label ?fair?.

Respectfully, Supposn

Ignoramus · Sep 6, 2010

Supposn said:
Ignoramus, VAT is efficient but it is not hidden. Sales taxes are conspicuously itemized within the sales transaction. Unlike any other sales tax method I?m aware of, the value added tax, (i.e. VAT) contains no imbedded or hidden additional sales taxes passed on from previous transactions.

Agreed, VATs are not hidden taxes. The problem is, I don?t really have a word that fits. You term non-intrusive is certainly better, though I?m not entirely happy with it. It?s similar to payroll withholding taxes if you leave out April 15. Since the payee pays before he gets the money, it?s not quite so noticeable. The sales tax hits at the other end of the income chain. Since it requires no paperwork, and no additional effort, the taxed simply pays it during the purchase. The VAT is superior because it is simpler for the supply chain.
I merely meant that taxes such as these are better from the standpoint of the state, because they are less noticed by the taxed. They also give less opportunities for evasion then most other tax systems.
Thank you for your correction.

Ignoramus · Sep 6, 2010

Supposn said:
Ignoramus, there is no tax that is fair but individual tax methods can be comparatively more or less equitable. What?s equitable is a subjective determination.

Supposn said:
Philosophy is a method or system of concepts. Mathematics is the most objective philosophy, politics and economics is more subjective and less objective than mathematics.
I did not choose the label "fair".
Respectfully, Supposn

Did you read my post? I stated that no tax can be fair in a social context. Perhaps I should ask more clearly what I implied. Is the "Fair Tax" fairer, and if so, fairer than what?
And please, let?s not play the "all degrees of imperfection are equal" game.
I suppose your definition of philosophy could fit into one of the many definitions of philosophy. However, politics at the level of applied politics as practiced today in the United States hardly fits into any definition of philosophy that occurs to me. That is unless we consider the science of criminology. However, that is usually the science of reducing crime rather than advancing its agenda. Economics has taken the place of religion in supplying the rationales which support the injustices of the state.
Of course you didn?t choose "Fair Tax", it?s a propaganda label applied to a bill in the corrupt cesspool of incompetence which ineptly serves our Elites.
Any time a con artist calls something he?s offering you fair, you should know enough to sidestep and get the Hell out of there.
All civilized social orders upload the harvest from the Harvesters to the Elites. That is the nature of Civilization. However, there are competent Elites and incompetent Elites. The events of the last thirty years should make clear which set we have in the United States.
Our present tax code is a jest in poor taste, however, we are at present in the midst of a financial cataclysm resulting from the clever smoke and mirror games of the hogs in charge at the moment. You may trust them to introduce a new tax code at this point in time. I?ll pass.
　

Supposn · Sep 6, 2010

ignoramus, concerning my message #4, there's nothing that I would consider modifying or adding to the message.

Respectfully, Supposn

The ?Fair tax? can only be passed incrementally

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Ignoramus

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