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A) You make $100,000 per year, and your expenditures for things you consider absolutely essential (food, shelter, transportation, health care, etc.) could be maintained a less than $50,000 per year, letting you control whether or not you pay taxes on the other $50,000. If you choose not to consume tangible items that are taxes, you essentially have 50% of your income tax-free.
B) You make $20,000 per year, and you wish you could afford even the most basic expenditures on that amount. It's even harder, however, because you have to pay taxes on 100% of your income, because all of it must be spent.
Only a conservative who has never had to live paycheck-to-paycheck and worry about where the next dollar is coming from would consider that fair.
So someone paying half your annual salary in just taxes isn't fair?
It assumes that the price of gods won't rise, yet the 23% included national sales tax (30% effective sales tax) is simply going to be tacked on to the total cost of goods and services purchased. Basically, one's "Total Maximum Taxable Consumption Available Annually" is going to wind up purchasing less Total Maximum Goods and Services Available Annually.
If I buy a gallon of milk now for $3.00, then assuming that I had a Total Max Taxable Consumption Available Annually of $10K, then I'd be able to buy 3,333 gallons of milk.
If I buy a gallon of milk with the Fair Tax in place, then the price of the milk rises to $3.90 per gallon. With the same $10K, I'd only be able to buy 2,565 gallons of milk. The cost of the missing milk purchased goes to pay the Fair Tax.
Everything that I've read or heard about Fair Tax sounds great...and I don't think that I've ever heard anyone come out strongly against it. Just the thought of tax being based on consumption rather than income seems fundamentally fair. I would love to be in a position that I could control the taxes that I paid. I would think that manufacturing would take a hit as people tried to avoid buying new cars etc...but other than that, what's not to love about it?
I don't claim to be an expert here, and admittedly, need to learn more, but I'm willing to bet that there are some on the forum that have studied it extensively and I'm curious to hear what you think.
the fair tax can succeed. only if the 16th Amendment is repealed, most of the irs fired and a max % limit is put into place on how much the fair tax can be taxed at.
A lot of teachers, policemen, firemen, and other hard-working people make $20K or less. Meanwhile a person with a trust fund can sit and do nothing yet make a fortune on interest. So who deserves to keep a bigger piece of pie?
I'd like to see the math where someone pays 50% of their higher rate of income in taking a second job. The highest rate is only 35% on income over $326,000.
I'm not at war with the rich either, I just think we should always err in favor of the middle and lower class. It would be awesome if most of us would only have to fork over 10% or less in income tax.
And a 100% tax on income over $1M/yr would only cause 144,000 people to scream. Who cares?
"A lot of teachers, policemen, firemen, and other hard-working people make $20K"
Take out the "other hard-working people" and give some facts to back this claim.
I come out strongly against the "fair tax" all the time. How in the hell can anyone justify taxes on goods and services other than by some kind of Marxist ideology? Its probably even worse than the current income tax.
I come out strongly against the "fair tax" all the time. How in the hell can anyone justify taxes on goods and services other than by some kind of Marxist ideology? Its probably even worse than the current income tax.
Are you actually under the impression you're not paying taxes on goods and services?
I hope you're trying to be funny, because that is a riot.
It assumes that the price of gods won't rise, yet the 23% included national sales tax (30% effective sales tax) is simply going to be tacked on to the total cost of goods and services purchased. Basically, one's "Total Maximum Taxable Consumption Available Annually" is going to wind up purchasing less Total Maximum Goods and Services Available Annually.
If I buy a gallon of milk now for $3.00, then assuming that I had a Total Max Taxable Consumption Available Annually of $10K, then I'd be able to buy 3,333 gallons of milk.
If I buy a gallon of milk with the Fair Tax in place, then the price of the milk rises to $3.90 per gallon. With the same $10K, I'd only be able to buy 2,565 gallons of milk. The cost of the missing milk purchased goes to pay the Fair Tax.
Everybody will actually be either paying less in taxes and/or receiving a prebate. Additionally, the cost of taking goods to the market would be reduced to companies.
Does the calculator have a flaw in it?
It assumes that the price of gods won't rise, yet the 23% included national sales tax (30% effective sales tax) is simply going to be tacked on to the total cost of goods and services purchased. Basically, one's "Total Maximum Taxable Consumption Available Annually" is going to wind up purchasing less Total Maximum Goods and Services Available Annually.
If I buy a gallon of milk now for $3.00, then assuming that I had a Total Max Taxable Consumption Available Annually of $10K, then I'd be able to buy 3,333 gallons of milk.
If I buy a gallon of milk with the Fair Tax in place, then the price of the milk rises to $3.90 per gallon. With the same $10K, I'd only be able to buy 2,565 gallons of milk. The cost of the missing milk purchased goes to pay the Fair Tax.
since the FairTax would replace the income tax AND payroll taxes, there would be a producer cost reduction that would exert downward pressure on prices.
and if i can be a wiseguy for a bit, i can assure you the price of gods will not rise.
I find it odd that people complain about property taxes they pay. It's a privilege to own property! If you don't want to pay property taxes, don't own property! Think of all the RENTERS in this country who pay a hidden property tax (because you know the owners of the property pass that tax along) but DON'T EVEN GET TO CLAIM IT ON THEIR INCOME TAXES!
There are a lot of single wage earners with no kids in the states of California and New York who earn over $50K a year and can file on the short form. Those of you who feel so ripped off by what you are paying in taxes ought to see what these people pay in taxes.
It's even worse than you think. Most states allow higher property taxes on rental property than on owner-occupied homes, e.g. in Michigan the typical rental house has more than $1,000 a year in extra property tax.
Money you pay for medical or house interest would be automatically deducted. Everybody pays the same when they buy something doing away with loopholes.
Income made on interest, bonds, stocks and used to purchase products would pay taxes also.
Illegals would pay the same amount we do. No free ride--that would make the decision for me.
Unfortunately, that's not quite how the FairTax works.
If you buy an existing home, there is no tax. (Because the home was originally purchased with after-income tax dollars, the home was effectively taxed in the beginning and once an item is taxed it is never taxed again.)
If you rent an existing home, rent is taxed because it is considered a service. Therefore the FairTax would allow people who buy an existing home to enjoy untaxed consumption while renters must pay tax month after month after month.
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