What do you people think about the Fairtax?

[pnorris]

I would like to see what some peoples reaction to the fairtax is on here. It is really picking up steam, and from everything i have read on it, i really hope it is passed into law very soon.
for more info go HERE (http://www.fairtax.org)

[momomike3]

I dont think it will get passed because they want to repeal the 16th. Also, it seems like it could make another bureacratic mess. But, who knows? Maybe it could work.

[JordanL]

Tax returns are perhaps the worst things I have ever conceived a government doing. I'm sure you're asking "why", wondering what could possess me to deride your check that bought you the iPod in your hands, or the new TV in your entertainment room. Perhaps you are wondering what this has to do with the FairTax. Well allow me to explain.

What exactly is a tax return? Well, a tax return is a check that the government sends you for overpaid taxes. Overpaid, eh? Do you ever remember sending them a check for those overpaid taxes? I'm pretty sure that you wouldn't have overpaid them if you had written them a check. No, the overpayment comes from the concept of withholding. Withholding is how most income taxes are collected. You get your check, and it has gross pay, then some deductions, right? Those deductions are taxes that you are paying. Or, in other words, the government is taking your money from you before you ever get it, and before they even know how much to take.

Many people don't get this fundamental principal. In fact, you'll here people say things like "I didn't pay any taxes this year! In fact, I got money back!" That the government has been able to convince the public of this is disturbing. Government spending would not be as hog-wild as it is, were it not for the fact that average Americans just aren't outraged. And the primary reason they aren't outraged, is that they don't see taxes as ever being their money. They never get that money, so why should they see it as theirs? This creates the illusion that government has an inherent right to take your money... to levy a tax. This is not true at all. Government is granted to right to levy a tax by the people because the people feel that the service provided by the government is worth the money paid.

But most people never understand this concept. Taxes are simply there. They just exist. You don't know your tax rate on each check... payroll takes care of that for you. I'm sure that many Americans would be shocked at the revelation that they make 15-30% more money than they think they do.

This creates a dangerous indifference to tax changes. If people never have possession of the money, they put don't put up a fight when you steal more of it. Since withholding has been enacted, taxes have increased at an unheard of rate. Because people never see this money, there is also less money to invest. I was looking at investing about $500 this month. In reality, my $500 is about $700... but about $200 was taken out before I even received it. then, once I invest it, they will take out another 18% in Capital gains taxes if I liquidate my assets. In other words, in order to compensate for the tax money I have lost, I need to turn my $500 into $871, or I need to earn nearly 75% on my investment.

But taxes aren't an expense, you say. They cannot be counted against investments as an expense, because they are not an expense of investing. Oh really? Enter the FairTax. Because there are no Capital gains taxes in a FairTax government, I no longer have to return that 18%. Further, because there are no more business taxes, the money I am investing to is no longer taxed. And yet further, because I receive 100% of my paycheck, I'll have my full $700 to invest, avoid triple taxation.

The FairTax will create wealth by providing an enormous amount of invesment capital for the economy, and will turn nearly every American into an investor. Many claim that the FairTax would create larger disparity between the rich and poor. But as this average middle class college student will attest to, the FairTax makes middle class investing exactly what it should be: Fair.

[pnorris]

I dont think it will get passed because they want to repeal the 16th. Also, it seems like it could make another bureacratic mess. But, who knows? Maybe it could work.

Whats wrong with wanting to repeal the 16th? True, this is what they want to do, but the Fairtax would replace it.

Not trying to flame, just asking a question...

Are you saying that you are ok with the US government taking money from you?

Wouldn't you rather get 100% of your paycheck and only spen taxes on what you buy?

[JordanL]

Whats wrong with wanting to repeal the 16th? True, this is what they want to do, but the Fairtax would replace it.

Not trying to flame, just asking a question...

Are you saying that you are ok with the US government taking money from you?

Wouldn't you rather get 100% of your paycheck and only spen taxes on what you buy?

I think he's saying that it won't make it through the government buracracy, not that it isn't a good idea.

[pnorris]

I think he's saying that it won't make it through the government buracracy, not that it isn't a good idea.

Ah I see. I apologize for not getting the point of your post... Yeah it is true that its got an uphill battle (if you can call a hill Mt. St. Helens) Too many lobby groups, too many unions and such.