Thread: FairTax and Trade

Originally Posted by johnwk

You just can't admit something when your wrong or know nothing about.


See: How Big Is the Underground Economy in America?

2016



Despite the inherent difficulties involved in such measurement, economists have attempted to calculate the size of shadow economies. One such economist, Friedrich Schneider, estimated that the size of the U.S. underground economy (not including criminal activity such as drug dealing etc.) relative to GDP was 7.2% in 2007, which was below the OECD average of 13.9%.



A 23 percent tax would encourage the underground economy to expand dramatically.


JWK

I don't care. That's up to the authorities to enforce the law. Under the FairTax, it's easy to catch them, easier to shut them down, you're using something that arose 40 years ago which isn't even an "underground economy", it's just income tax evasion as some reason to oppose the FairTax which isn't an income tax, it's a national retail sales tax. It's just tax cheaters. The fewer tax collections you have the easier it is to manage it and enforce the law. There's only 6 million entities that will collect FairTax versus over 200 million who are subject to the income tax. And states will be involved, they get a fee, they'll be very diligent in collecting all the tax and going after violators, because it's money out of their coffers, too.

That said, the FairTax assumes 15% evasion, the same as the income tax. The beautiful thing about the FairTax unlike the income tax is that when the crooks spend their money they stole from consumers, they will pay FairTaxes when they do. So, the tax evasion thing is not an issue for me. We have lots of crooks in the United States, but I'm not one to allow them the power to prevent a fix to our country.

I've never heard real people call income tax evasion an "underground economy".

Originally Posted by Judy

What underground economy? Where is this underground economy? Does anyone besides you, MW and jtdc know about it?

Virtually all gang members buy their guns on a black market. Druggies get their drugs in a black market. You are really bending over backward to show your ignorance of the real world around you. Your drug states have new cartels growing to do business in their states. This sales tax will just be a new giant market for the crime cartels. And you know it!

Originally Posted by Judy

I've lived in 4 states, worked in 20 states and have never seen this "underground economy"?

You apparently don't even watch the news!

Originally Posted by judy

I see knock-offs on the streets of New York selling fake stuff. But that's hardly an "underground economy", any NYPD officer can shut them down in 3 seconds if they wanted to.

They can establish buyer's clubs where they can wheel and deal away from the eyes of the law. Think of the Speak Easies" during Prohibition. Did the Prohibition laws and Revenuers stop the sale of Moonshine?

Originally Posted by Judy

The importer doesn't pay the FairTax. The sellers on the sidewalk collect the FairTax from consumers.

And the seller can say "meet me around the corner and I can save you 15% on the item.

Originally Posted by Judy

Any law enforcement in New York can check their sales receipts on the spot. They have to have a permit to get the rights to sell on the streets as a vendor to begin with.

And those cops will have to constantly count their inventory to see if it balances with the receipts. And if they only show half of their inventory to the cop, they have plenty to sell in the alley!

Originally Posted by Judy

Very easy to ensure the FairTax is collected properly. And I would hardly call the "streets of New York" an "underground economy".

How do all the drugs and guns get sold? They are not doing it at a stand where the cops are walking by. You are a naive leftist who believes in the goodness of humanity!

Originally Posted by Judy

You guys don't understand how the Fairtax works, who is actually responsible for paying for it, how it impacts our economy,

No, you don't understand that the higher the cost of something, the more people will try to find a cheaper way to buy it.

Originally Posted by Judy

What claims will not come to fruition? You don't think taxing imports will reduce imports?

All of your claims!

The idea of tariffs on imported items is to raise the price to meet an equivalent price for an American product. Your tax would raise the price of all products leaving the import with the advantage it would have if we didn't have a sales tax. The tariff is only applied to the imported products, and that is the equalizer!

Originally Posted by Judy

You don't think taxing illegal aliens instead of handing them tax refund welfare will curb illegal immigration?

You are apparently too ignorant to read what I have written several times. It is an insignificant burden!

Originally Posted by Judy

The FairTax doesn't track profit. There is no FairTax on profit. There is no profit to "track", so there is no "untracked profit" with the FairTax.

And there is no record to see. So anything sold out the back door can add 23% to the profit on the item. Pretty attractive to many.

Originally Posted by Judy

No, the FairTax is not "rated" to replace the taxes it's eliminating.

So it cannot reduce the National Debt. ANOTHER OF YOUR FALSE CLAIMS FOR YOUR SNAKE-OIL!

Originally Posted by Judy

The FairTax rate hasn't changed, it's still 23% just as it was in 1999, the one year we almost balanced the budget, but it is not revenue neutral any more, it's much more revenue now, much, much more.

In World Wars, Income Tax was ordered. And we have seen many times that a "temporary tax" becomes a permanent tax. Taxes are very seldom reduced. The FairTax can likewise be changed. It is not carved in stone! Until Congress stops spending more than we take in, the debt will grow. And we have seen that Congress will raise taxes (and raise their wages) to cover the spending they legislate. Or borrow more, putting us deeper in debt. Look at how many Continuing Resolutions we have had in recent years, and raises in the Debt Ceiling! Your nuts if you think changing the way we collect money will fix anything!

The black market is the sale of illegal goods, it's not income tax evasion.

The Speak Easies didn't exist because of the income tax, they existed because of Prohibition.

Illegal drugs is a black market for the same reason, bans on the products. When weed is legalized, then there will be a grand new source of revenue under the FairTax, people will have nice and safe stores to buy their products in, the criminals will end out of business and in jail, not because of the FairTax, they aren't doing this to avoid taxes, they're doing this as a last stab at saving their illegal drug trade, but because of legalization and regulation by the States. The feds will make money on this and rightly so whether we have the income tax or the FairTax. The FairTax is just a much simpler way to tax the sale of weed or any other drug they determine should be legalized.

Gun shouldn't be illegal, and any black market on that is because of state gun control laws, not federal taxes.

You guys just can't keep your ducks lined up in a row or your apples and oranges separate. A true sign of desperate ignorance.

But hey, if you're the type of person who wants to buy shit in an alley or down by the docks from a bunch of criminals to save a national retail sales tax on a stolen TV, good luck to you. You can brag about it to all your friends and family. I'm sure they'll be proud!

Originally Posted by Judy

1979 income tax evasion 40 years ago? Oh, so the "underground economy" is something that developed under the INCOME TAX.

Gee, you were unaware that there was an underground economy. Now that you see the evidence, that it may be 1/3 the size of the legitimate economy, you think your sales tax is not as vulnerable, and probably more than our Income Tax method.

Originally Posted by Judy

The legislation calls for a 23% FairTax rate, 8.09% earmarked for Social Security and 14.91% for General Revenue. There is no 30% FairTax anywhere. You don't collect 30%, you collect 23%, and you send in 23%, not 30%. You charge customers 30% and you're going to jail, for a long time for tax fraud. And every time you post that crap, you're promoting it, aiding and abetting potential tax fraud against the public.

You're not fooling anyone.

Excerpt:

The Fair Tax Act and Inclusive Taxation

The Fair Tax Act may attempt to improve the current system, which favors the wealthy with loopholes and big deductions, by replacing it with a more equitable system of taxation. However, this may not be the case. While the downsides are troubling, what is most disturbing is how advocates present the plan.

First, let’s quickly review the current sales tax and what the change would mean. Everyone in this country is accustomed to paying what’s called an “exclusive tax” on their purchases. This means we see how much an item costs and then calculate the tax on top of that price. In fact, until I read about the Fair Tax Act, I didn’t know there was any other way to pay sales tax.

Since this is the crux of the Fair Tax plan, it’s worth addressing again. If you purchase an item for $100 that has a 23% tax, you would expect to pay $123 total. This would be an exclusive tax. However, the Fair Tax plan calculates their tax as inclusive. In other words, your $100 purchase already incorporates $77 for how much the item costs and $23 for the actual tax. But a $23 tax on a $77 purchase comes out to 30% the way we currently measure it.

In explaining the plan, it seems that Fair Tax proponents call it a 23% tax so the plan sounds better. And this makes me wonder, what else are they spinning, and why do they misrepresent a crucial aspect of their plan in the first place? If the people vetting the tax plan don’t understand why it’s misleading to talk about an inclusive sales tax, then I suspect other aspects of the plan will be misleading and possibly flawed as well.
On the other hand, if the ruse is intentional (which seems like the rational explanation), what else are they trying to sneak past us, and why? As if the length of the list of cons isn’t enough, this simple bit leads me to suspect that the Fair Tax is anything but fair, and that it’s just another ploy to get the rest of us to pad the pockets of the upper and corporate classes.

https://www.moneycrashers.com/fair-tax-act-explained-pros-cons/


Excerpt:

Studies That Don't Support the Fair Tax

William Gale of the Brookings Institute noted that the FairTax it isn’t accurate to refer to the Fair Tax as 23 percent.

The rate is actually 30 percent. FairTax defines the sales tax as "$0.23 out of every dollar spent." This means there is a $0.23 tax added to every $0.77, not to every dollar, and $0.23 is 30 percent of $0.77. Gale also points out that the tax rate would likely need to be raised even higher. With no IRS to determine wages, states would need to abolish their income tax. This lost state revenue would require an additional 10 percent sales tax to replace it.

Another 5 percent would need to be added to recoup revenue from those who have figured out how to avoid the sales tax. For example, many people would declare more purchases as business expenses, which wouldn't be taxed.

These three adjustments estimate the sales tax at 45 percent. If Americans successfully protested including food and healthcare in the tax, the effective rate could skyrocket to 67 percent.

Gale's calculations show that the Fair Tax would cause taxes to rise for 90 percent of all households. Only those in the highest 10 percent of incomes would get a tax cut. Those in the top 1 percent would receive an average tax cut of over $75,000.

If the Fair Tax Plan was adjusted so households are classified by consumption level, then those in the bottom two-thirds of the distribution would pay less, while those in the top third would pay more. But those at the very top would still pay much less, again receiving a tax cut of about $75,000.

https://www.thebalance.com/what-is-the-fair-tax-plan-pros-cons-effect-3305765


Excerpt:

The FairTax is a national retail sales tax of 30 percent on the final sale of all new goods and services. All new goods — from cars and houses to prescription drugs and food; and all services — from operations and funerals to rent and haircuts.

https://mises.org/library/flat-tax-n...irtax-not-fair

Excerpt:

The Fair Tax: Is It 23 Percent or 30 Percent?

The actual rate of the so-called "fair tax" is a source of considerable confusion and disagreement.

Proponents of the tax, and legislation before Congress, refer to a tax rate of 23 percent. But this is based on a calculation that most people wouldn't use or understand.

The proponents of the tax arrive at the 23 percent number this way: They say the tax will add 30 cents to every dollar; then they calculate what percentage of the total (cost plus tax) is represented by the tax. In other words, the additional 30 cents represents 23 percent of $1.30. This is called the "tax-inclusive rate."

But if you want to know how much the tax would add to every dollar spent, the answer is 30 percent. This is called the "tax-exclusive rate." To put it more simply, adding 30 cents to every dollar is a 30 percent tax.

This is an example of how semantics can blur substance.

https://www.npr.org/templates/story/...oryId=17209388


Excerpt:

The FairTax Rate

The rate of the FairTax is about 30 percent (to be more precise, 29.87%). However, by employing a little FairTax new math, the rate is given by FairTax proponents as 23 percent. Sometimes the caveat is added that the rate is figured inclusively (the tax is included in the price of the product) rather than exclusively (the tax is added to the price of the product). Obviously, it is much easier to sell a national sales tax if the rate is 23 percent instead of 30 percent. Boortz devotes almost eight pages of inclusive/exclusive smoke and mirrors in the book to answering the criticism that the FairTax rate is actually 30 percent.

https://mises.org/library/there-still-no-such-thing-fair-tax#5

The truth is out there for anyone that wants to research it.

Originally Posted by Judy

I don't care.

So facts don't matter to you if they might make you wake from your fantasy dream!

Originally Posted by Judy

Under the FairTax, it's easy to catch them, easier to shut them down,

How? Since they don't have to report profit and loss/income, their is no record of the inventory they handle, So they can hide as much as they want, to avoid the sales tax.

Originally Posted by Judy

you're using something that arose 40 years ago which isn't even an "underground economy", it's just income tax evasion

Exactly! It doesn't make a difference which tax is being evaded, it is how easy it is to evade. And your tax method is far easier to evade!

Originally Posted by Judy

There's only 6 million entities that will collect FairTax versus over 200 million who are subject to the income tax.

And how many millions of manufactures, importers, distributors, shippers, and others, who can sell products to the black market that you didn't know exists? Billions?

And states will be involved, they get a fee, they'll be very diligent in collecting all the tax and going after violators, because it's money out of their coffers, too.

Oh yeah, just like the states are helping police illegal aliens! You tell a lie to push your sales tax.

Originally Posted by Judy

That said, the FairTax assumes 15% evasion, the same as the income tax.

SO AFTER PRETENDING TO NOT KNOW OF AN UNDERGROUND ECONOMY, YOU ADMIT THE AUTHORS EXPECTED WHAT YOU HAVE BEEN ARGUING COULDN'T HAPPEN!

Originally Posted by Judy

The beautiful thing about the FairTax unlike the income tax is that when the crooks spend their money they stole from consumers, they will pay FairTaxes when they do.

How stupid can you pretend to be? If they are running a black market, they won't need to buy from the legitimate retailers.

Originally Posted by Judy

So, the tax evasion thing is not an issue for me.

We know. You started your post proclaiming that you don't care!

Originally Posted by Judy

I've never heard real people call income tax evasion an "underground economy".

How could you? You didn't even know it existed until now!

Originally Posted by jtdc

All of your claims!

The idea of tariffs on imported items is to raise the price to meet an equivalent price for an American product. Your tax would raise the price of all products leaving the import with the advantage it would have if we didn't have a sales tax. The tariff is only applied to the imported products, and that is the equalizer!

You are apparently too ignorant to read what I have written several times. It is an insignificant burden!

And there is no record to see. So anything sold out the back door can add 23% to the profit on the item. Pretty attractive to many.

So it cannot reduce the National Debt. ANOTHER OF YOUR FALSE CLAIMS FOR YOUR SNAKE-OIL!

In World Wars, Income Tax was ordered. And we have seen many times that a "temporary tax" becomes a permanent tax. Taxes are very seldom reduced. The FairTax can likewise be changed. It is not carved in stone! Until Congress stops spending more than we take in, the debt will grow. And we have seen that Congress will raise taxes (and raise their wages) to cover the spending they legislate. Or borrow more, putting us deeper in debt. Look at how many Continuing Resolutions we have had in recent years, and raises in the Debt Ceiling! Your nuts if you think changing the way we collect money will fix anything!

On my God, you don't know anything about the FairTax. The FairTax doesn't raise the price of any domestic product, it actually lowers it. It raises the price of imports simply because most of them pay no tax or tariff at all while American Businesses are supporting one of the most expensive markets on the globe and a very expensive government. You want access to our market, you're going to pay or go sell your shit somewhere else. Try Canada!! They're all "global". Try Germany, they're all "global."

No the tax on illegal aliens is a very very significant cost. See you don't understand how the Rebate works, that's why you get angry and ugly. You don't understand the math.

Americans qualify for a Rebate equal to $226 a month per adult and $81 per child. Illegal aliens don't.

A family of four, 2 adults and 2 children would receive a monthly rebate of $661 dollars, based on 1/12 of the annual rebate of $7,328 based on a household consumption allowance of $31,680.

$661 a month divided by 160 hours a month is $4.00 an hour on a standard work week of 40 hours a week for 4 weeks.

So illegal aliens are punished big time by the FairTax and being excluded from the FairTax Rebate. They not only lose all their income tax handouts, they now have to pay $661 a month in FairTaxes that Americans don't have to pay if they sign up for the Rebate. The Americans receive their wage of say $10 an hour plus $4.00 an hour in Household Rebate which is $16.00 before they decide how to spend their money. And in the American household, there are usually 2 jobs so that's $24 an hour for the household. Illegal aliens vying for the same job only make $10.00 an hour usually for 1 worker before they spend their money, and after FairTaxes only have $6.00 an hour compared to the Americans who have their full $20.00 an hour for two adults earning at least $10 an hour each.

It's a huge debilitating penalty for illegal aliens compared to American Workers whose jobs illegal aliens are trying to steal by undercutting them. I mean maybe you know a bunch of illegal aliens who can live in California with a wife and 2 kids on $6 an hour, but I don't know anyone who can live anywhere on that.

No, I'm not nuts, you're nuts, a crazy hysteric about to lose his beloved income tax. How Congress spends the money it receives is up to them and their constituents. But with the FairTax taxing imports, illegal aliens and tourists, while our manufacturers and producers are all tax-free, lean, efficient machines, our workers are going home with all their paycheck free of federal income and payroll withholdings ..... and the government ends up with much more money than it ever did under the income tax raised voluntarily by consumer choice and from many new sources ..... if you can't see the beauty in this tax plan and all that it does to help those of US who really want to fix our country, then you can just be an Ole Grumpy upset that you lost your Turbo Tax stock which might be MW's concern or someone in the family had to look for a new job because their income tax employer went out business or like Johnwk, grumbling over how all hope of his feudal lord system he wants is lost and even now "no longer in print" and he's stuck filing very simple monthly FairTax reports on his retail services.

But many new better investments will be available for stock purchases, many new jobs for bustling businesses and companies who need people who are good with paperwork and counting money, and I think most states will say "hell with this income and property tax crap, lets go all sales tax like the FairTax" and every American will shout from the rooftops, "THANK YOU JUDY AND PRESIDENT TRUMP!"

Republicans will control the Congress for many years to protect our FairTax, to protect our trade, to protect our workers and to protect our borders.

No American will ever lose their home, business, savings, earnings or freedom because of a federal income tax issue and I think soon after, from a state income or local property tax issue either. SS and Medicare will never run out of money, and Americans will be safe, sufficient, employed, prosperous and happy.

Vote Republican in 2018 and Make the FairTax Happen!!

Originally Posted by Judy

The black market is the sale of illegal goods, it's not income tax evasion.

It evades the tax!

Originally Posted by Judy

The Speak Easies didn't exist because of the income tax, they existed because of Prohibition.

They existed to evade the law. Alcohol was bought and sold there, avoiding taxes as well as arrest!

Originally Posted by Judy

Illegal drugs is a black market for the same reason, bans on the products.

And the same way, taxes are not paid!

Originally Posted by Judy

When weed is legalized, then there will be a grand new source of revenue under the FairTax,

And more black markets!

Originally Posted by Judy

the criminals will end out of business and in jail,

Just like the War On Drugs has stamped out drug cartels!

Originally Posted by Judy

Gun shouldn't be illegal, and any black market on that is because of state gun control laws, not federal taxes.

So any criminal, psycho, and terrorist should be able to buy a gun?

Originally Posted by MW

You're not fooling anyone.

Excerpt:



https://www.moneycrashers.com/fair-tax-act-explained-pros-cons/


Excerpt:



https://www.thebalance.com/what-is-the-fair-tax-plan-pros-cons-effect-3305765


Excerpt:



https://mises.org/library/flat-tax-n...irtax-not-fair

Excerpt:



https://www.npr.org/templates/story/...oryId=17209388


Excerpt:



https://mises.org/library/there-still-no-such-thing-fair-tax#5

The truth is out there for anyone that wants to research it.

When you learn the difference between a tax and a Anti-FairTax Lobby article about a mark-up, then you should speak. Until then, you should be quiet.

The truth is in the legislation. You sell something for $100, you send $23 to the state not $30.
And you're right, I'm not fooling anyone. You are. This kind of misinformation because you don't understand the difference between a tax and mark-up is really dangerous, scary even. Geez. So irresponsible.