Fair Tax Act?

[xds&chevys]

I saw a report on Faux news and they were talking like this is actually being considered.

The first problem I can see is how they are giong to implement the new act and abolish the IRS at the same time. Or will they start the fair tax and grow it while slowly dismantling the IRS. Or will they und up keeping both and taxing us more.

My wife brought up the point that lots of stuff might go back to the barter system to avoid paying taxes. (my jet for your yacht, my truck for your car)

Just wondering if anyone else has thoughts on this. I want to pay less taxes but I'm not yet convinced that this is the way to go about it.

[mgeoffriau]

Originally Posted by xds&chevys

My wife brought up the point that lots of stuff might go back to the barter system to avoid paying taxes. (my jet for your yacht, my truck for your car)

It wouldn't matter. The FairTax proposal only recommends sales tax on new goods. Used goods would not be taxed (or more accurately, used goods would not be re-taxed, as they were already taxed once when they were sold as new goods).

[KEVWYO]

Just to clarify ... the Fair Tax would replace the current income tax system? A national sales tax so to speak?

[robinsre]

Originally Posted by xds&chevys

My wife brought up the point that lots of stuff might go back to the barter system to avoid paying taxes. (my jet for your yacht, my truck for your car)

Nothing's stopping folks from doing that now.

I regularly barter work and computer parts out for guns and ammo. I'd rather the gubbermint not be skimming off EVERYTHING.

[ichy_trigger]

Americans For Fair Taxation:

[ForTehNguyen]

Id really like this national sales tax. The current tax system punishes you for being more successful (making more money). People making poverty level wages consume far more tax resources than they generate. National sales tax is the only way to truly tax everyone, hell even drug dealers and cash under the table immigrants need to buy food. The current tax system has no way to tax these people.

[rockerz71]

I recommend this book
Amazon.com: The Fair Tax Book: Saying Goodbye to the Income Tax and the IRS: Neal Boortz,John Linder: Books

[xds&chevys]

using their calculator, these are my results
-------------------------------------current system----- fair taxsystem
true purchasing power......................... 74,868.44............. 73,009.70
dollar increase in spendable income ..............n/a.............. -$1858.73
percent increase in spendable income ...........n/a.................... -2.48%
effective federal tax rate ..........................16.04%............... 17.07%
gross income........................................ 102,000............... 102,000
less pretax savings plans .............................0.00 ...................0.00
less social security taxes....................... 5,394.00................... 0.00
less medicare taxes ..............................1,479.00............ ....... 0.00
less federal income taxes...................... 9,491.00 ....................0.00
prebate family allowance ............................0.00 ..............5,497.00
spendable income ..............................85,636.00........... .. 107,497.00
mortgage payment .............................7,388.00............. .... 7,388.00
tax on mortgage servic fees...................... 0.00 .......................0.00
chaitable comtributions ..........................200.00.................. . 200.00
investment contributions ...........................0.00 ......................0.00
used items and gift cards...................... 300.00.................... 300.00
net spendable................................... 77,748.00.............. 99.609.00
cost of hidden taxes................................. 0.00...................... 0.00
federal sales tax ........................................0.00...... ....... 22,910.07
education investment............................... 0.00...................... 0.00
local sales tax..................................... 2,879.55 ..............3,689.22


MY BOTTOM LINE
With the fair tax I get:
-2.48% more spendable income
-1,858.73 more purchasing power
-1,049.06 less federal taxes

The bottom line numbers listed above are negative numbers.

So for all I can tell this system is going to cost me more than I am currently paying in income tax. Furthermore, if your scenario is that you make 40,000 a year, ovr the course of that year you will spend almost all of that money to merely exist, so you will pay taxes on all of it. On the contrary if you make 100,000,000 you would only have pay taxes on the amount of your spending (say you could get by on 1,000,000).

So I believe that this new system is proposed to allow the rich to not have to pay anywhere near the amount of income that they currently pay and to put the burden on the lower and middle class

But also, after they implement the new system they will have no use for the thousands of people who work for the IRS, thus costing more jobs and putting even more money in the federal governments pocket.

Would someone else please use this calculator and see if it would improve your financial situation. and then use it again changing your income and investing to stupid big numbers, like 100,000,000 for income and 30,000,000 in investments and savings and 20,00,000 in federal income tax for last year. the results were astounding.

[kannibul]

Yeah, and yet I was getting ripped for even suggesting that the rich should pay more taxes than the poor, because the dollar has less meaning for the rich than the poor.

[kannibul]

Funny, I just did the calculator, and ended up with more money.

Just as my own income (41K), single, etc. I had a 6% increase...