6 ms·

So? There would be no federal income tax. Further, there would be no corporate income tax, so in general prices will fall and wages will rise. Money invested or

So? There would be no federal income tax. Further, there would be no corporate income tax, so in general prices will fall and wages will rise. Money invested or saved would not be taxed, lowering the overall rate. Finally, the prebate makes up the difference for low-income folk. From the article you linked: "Moreover, even FairTax critics like Gale agree that consumption taxes increase the size of the economy. Many studies show that long-term incomes would rise under a consumption-based tax system. Optimistic accounts show a 10 percent rise in income over time, but even the more cautious studies show gains of 5 percent to 7 percent. Because the FairTax will grow the economy, workers will eventually see increases in their income." There are difficulties in implementing the Fair Tax (income tax must once again be made unconstitutional) but overall it's an extremely good idea. Imagine the gains just from the recovered productivity of everyone employed at the IRS, the myriad tax accountants, and individuals relieved from dealing with the entire mess. The billions spent on the IRS every year would also be used for something better.

tptacek 12y ago
Did you read the article? The conclusion is that anyone making between 20,000 and 200,000 would see their share of the federal tax burden rise, and those making over 200,000 would see it fall. The paragraph you're quoting from is in a section that could have been titled "Fuck It, It's A Regressive Tax But It's Still Good". You wrote: The "tax increase" you mention is not an increase, read up on the Fair Tax. The prebate is designed to eliminate the potentially regressive nature of the tax. You were incorrect. You cannot now move the goalposts.
- tptacek 12y ago
  (I'm asking seriously about you reading it, not being snarky, about that bit.)
- ElectronCharge 12y ago
  'The paragraph you're quoting from is in a section that could have been titled "Fuck It, It's A Regressive Tax But It's Still Good".' (Sorry it's been so long since I replied last, I hope you notice this.) That's exactly right, 'regressive' is not necessarily bad. The top 10% of earners right now pay something around 70% of all income tax: http://taxfoundation.org/article/summary-latest-federal-income-tax-data http://taxfoundation.org/article/summary-latest-federal-inco.... Is that 'fair'? What is the 'correct' number? Food for thought. At any rate, the reason the Fair Tax's 'regression' isn't bad, is the estimated increase in tax burden for the middle class is around 2-3%. HOWEVER, the estimated wage benefits of the Fair Tax total 5-10%. So, even though the middle class is paying a higher share than now, its net income would go up 2-8%. That's a win, plus the entire IRS and income tax apparatus is gone - another huge win. Given the political abuses the IRS has facilitated lately, it needs to go. We don't need an American Gestapo.
  - dragonwriter 12y ago
    Anyone that talks about how much the top x% of earners pay of federal income tax in isolation -- especially without talking about their share of income, but not only then -- is either ignorant or dishonest. The federal income tax isn't the only federal tax on income, or even the most burdensome for most workers (federal payroll taxes are.) And it doesn't eliminate the need for a tax collection and enforcement apparatus, as all other existing consumption taxes demonstrate, so saying it eliminates the need for that is inaccurate.
    - ElectronCharge 12y ago
      It eliminates the need for the IRS. Verification of consumption tax collection is enormously easier, and there would no longer be all the loopholes, or the ~75,000 page(!) tax code. Most importantly, those paying the taxes would no longer be under any tax-related government scrutiny. Fourth Amendment, anyone? :-)

tptacek 12y ago

Did you read the article? The conclusion is that anyone making between 20,000 and 200,000 would see their share of the federal tax burden rise, and those making over 200,000 would see it fall. The paragraph you're quoting from is in a section that could have been titled "Fuck It, It's A Regressive Tax But It's Still Good". You wrote: The "tax increase" you mention is not an increase, read up on the Fair Tax. The prebate is designed to eliminate the potentially regressive nature of the tax. You were incorrect. You cannot now move the goalposts.

tptacek 12y ago
(I'm asking seriously about you reading it, not being snarky, about that bit.)
ElectronCharge 12y ago
'The paragraph you're quoting from is in a section that could have been titled "Fuck It, It's A Regressive Tax But It's Still Good".' (Sorry it's been so long since I replied last, I hope you notice this.) That's exactly right, 'regressive' is not necessarily bad. The top 10% of earners right now pay something around 70% of all income tax: http://taxfoundation.org/article/summary-latest-federal-income-tax-data http://taxfoundation.org/article/summary-latest-federal-inco.... Is that 'fair'? What is the 'correct' number? Food for thought. At any rate, the reason the Fair Tax's 'regression' isn't bad, is the estimated increase in tax burden for the middle class is around 2-3%. HOWEVER, the estimated wage benefits of the Fair Tax total 5-10%. So, even though the middle class is paying a higher share than now, its net income would go up 2-8%. That's a win, plus the entire IRS and income tax apparatus is gone - another huge win. Given the political abuses the IRS has facilitated lately, it needs to go. We don't need an American Gestapo.
- dragonwriter 12y ago
  Anyone that talks about how much the top x% of earners pay of federal income tax in isolation -- especially without talking about their share of income, but not only then -- is either ignorant or dishonest. The federal income tax isn't the only federal tax on income, or even the most burdensome for most workers (federal payroll taxes are.) And it doesn't eliminate the need for a tax collection and enforcement apparatus, as all other existing consumption taxes demonstrate, so saying it eliminates the need for that is inaccurate.
  - ElectronCharge 12y ago
    It eliminates the need for the IRS. Verification of consumption tax collection is enormously easier, and there would no longer be all the loopholes, or the ~75,000 page(!) tax code. Most importantly, those paying the taxes would no longer be under any tax-related government scrutiny. Fourth Amendment, anyone? :-)