H R 25, the "fair tax" proposal

[Stephen Eldridge]

Being a tax professional perhaps you could share some of these creative means of concealing sales?
The underworld underpass SS as well as income tax. Not with FAIRtax.

Sellers will simply NOT report many sales. They will under-report their purchases. Sellers will be pushed to cheat to a degree heretofore unknown, by the 30-45% combined FAIRtax + S/L sales tax rates. There will be completely illegal (cash) sellers (think Tony Soprano selling from a stolen truck).

AND, please do not ignore the immense legal market in tax avoidance, which will also flower.

Thus, the FAIRtax (which is supposed to fund SS/medicare) will be GREATLY short of its target revenues. So much so that the shortfall can be made up ONLY with a NEW Income Tax. See
http://sceldridge.wixsite.com/sceldridge#!the-myth-that-the-irs-is-abolished-/c1tu0yth

and

https://danieljmitchell.wordpress.com/2012/08/11/a-primer-on-the-flat-tax-and-fundamental-tax-reform/

 

[dogtowner]

Sellers will simply NOT report many sales. They will under-report their purchases. Sellers will be pushed to cheat to a degree heretofore unknown, by the 30-45% combined FAIRtax + S/L sales tax rates. There will be completely illegal (cash) sellers (think Tony Soprano selling from a stolen truck).

AND, please do not ignore the immense legal market in tax avoidance, which will also flower.

Thus, the FAIRtax (which is supposed to fund SS/medicare) will be GREATLY short of its target revenues. So much so that the shortfall can be made up ONLY with a NEW Income Tax. See
http://sceldridge.wixsite.com/sceldridge#!the-myth-that-the-irs-is-abolished-/c1tu0yth

and

https://danieljmitchell.wordpress.com/2012/08/11/a-primer-on-the-flat-tax-and-fundamental-tax-reform/

The wholesalers will not under report because who they buy from would have to agree to also underreport and they have no reason to do so and every reason not to. Now thievery could go up but then you get big insurance interested and they are the last guys you want sniffing around.
Now I am quite sure the tax industry hates this more than politicians as it puts them out of a job while it merely ties the hands of the pols.
At the end of the day the only ones who come out ahead are the middle class who are left holding the bag. And for them flat tax is even better.

 

[Stephen Eldridge]

You just don't get it.

Business to business sales are not subject to the FAIRtax, so there will be no interest in STAA auditing companies in the supply chain (other than intermediaries' end-use purchases). It would be physically impossible for STAA to account for all purchases made in the US.

My Flat Income Tax would also put the tax industry out of business.

Your comment is confusing. The middle class gets hurt the worst under the FAIRtax, while the poor make out like bandits (as admitted by Neal Boortz).

 

[dogtowner]

You just don't get it.

Business to business sales are not subject to the FAIRtax, so there will be no interest in STAA auditing companies in the supply chain (other than intermediaries' end-use purchases). It would be physically impossible for STAA to account for all purchases made in the US.

My Flat Income Tax would also put the tax industry out of business.

Your comment is confusing. The middle class gets hurt the worst under the FAIRtax, while the poor make out like bandits (as admitted by Neal Boortz).

They have to demonstrate that they are, in fact, b2b. Doesn't happen now as there is no need. That changes with ft.
The middle class always gets hurt worst except for flat. The poor don't pay either way so it's generally a wash.

 

[Stephen Eldridge]

They have to demonstrate that they are, in fact, b2b. Doesn't happen now as there is no need. That changes with ft.
The middle class always gets hurt worst except for flat. The poor don't pay either way so it's generally a wash.

As I said, businesses selling to businesses will generally not be audited and more importantly you missed my point that it is physically impossible for STAA to account for all goods that move through the US marketplace. Evasion and legal avoidance would be ENORMOUS, according to all independent (i.e., those not paid by the FT lobbyists) economists/writers.

Under FT, the middle class subsidizes the poor even more than today - a terrible Progressive effect, IMHO.

Under my VERY Flat Income Tax, the poor would be required to pay tax. At the very least, the number of people paying tax should be gradually INCREASED over time.

 

[dogtowner]

As I said, businesses selling to businesses will generally not be audited and more importantly you missed my point that it is physically impossible for STAA to account for all goods that move through the US marketplace. Evasion and legal avoidance would be ENORMOUS, according to all independent (i.e., those not paid by the FT lobbyists) economists/writers.

Under FT, the middle class subsidizes the poor even more than today - a terrible Progressive effect, IMHO.

Under my VERY Flat Income Tax, the poor would be required to pay tax. At the very least, the number of people paying tax should be gradually INCREASED over time.

You need to consider that when you drop to the wholesale level there are a fraction of the players at the retail level. So yes quantities are larger but fewer to manage. And as you drop back levels there are fewer and fewer players and they have nothing to gain abetting the crime and much to lose. It's the retail level fraud occurs on and there is no reason for wholesalers to facilitate.
Now I could see an entire black market attempt to form but as soon as things started breaking down and you can't use the warrantee there goes the market.
Big difference between selling hooked and dope and selling cars and tvs.

 

[Stephen Eldridge]

You need to consider that when you drop to the wholesale level there are a fraction of the players at the retail level. So yes quantities are larger but fewer to manage. And as you drop back levels there are fewer and fewer players and they have nothing to gain abetting the crime and much to lose. It's the retail level fraud occurs on and there is no reason for wholesalers to facilitate.
Now I could see an entire black market attempt to form but as soon as things started breaking down and you can't use the warrantee there goes the market.
Big difference between selling hooked and dope and selling cars and tvs.

 

[Stephen Eldridge]

I don't know what your professional experience and training are, but you are creating your own fantasy world about the US economy and supply chain.

There are innumerable manufacturers and suppliers of goods. It is physically impossible to audit and control all goods and services sold in the US.

You fail to grasp that the pressure to cheat the FAIRtax (combined with S/L) will be so great that the marketplace will develop innumerable, imaginative, creative ways to cheat.

Saving 30-45% sales tax is a GREAT incentive to cheat. Manufacturers could still honor their warrantees, no matter where consumers bought their product.

 

[The Scotsman]

I don't know what your professional experience and training are, but you are creating your own fantasy world about the US economy and supply chain.

gettin a hard ride from the plebs huh...!

 

[Stephen Eldridge]

Scotsman,


????????????

If you have an intelligent thought top offer, please do so in plain English.

I have no idea of what your comment means to say.

 

[dogtowner]

I don't know what your professional experience and training are, but you are creating your own fantasy world about the US economy and supply chain.

There are innumerable manufacturers and suppliers of goods. It is physically impossible to audit and control all goods and services sold in the US.

You fail to grasp that the pressure to cheat the FAIRtax (combined with S/L) will be so great that the marketplace will develop innumerable, imaginative, creative ways to cheat.

Saving 30-45% sales tax is a GREAT incentive to cheat. Manufacturers could still honor their warrantees, no matter where consumers bought their product.

23%.
If the manufacturer acknowledges it delivered the serial numbered item for retail sale the ruse is spoiled.
That can of green beans is harder but nobody is going to fret about that nearly as much as the speedboat, Ferrari or gold toilet.
I worked IT for grocery distribution, medical supply, Coca Cola and multinational manufacturing. I know something about how and why companies track things.

 

[dogtowner]

gettin a hard ride from the plebs huh...!

Damn plebes.....

 

[Stephen Eldridge]

Damn plebes.....

Scot, it occurred to me later that you meant "plebes" instead of "plebs" that you wrote originally.

Yes, those people who constitute the FAIRtax target audience (i.e., the ignorant, the easily swayed people who cannot think and analyze on their own, and of course those with no tax education or experience), who has swallowed the FAIRtax Koolo-Aid and simply "believe" in it (I call them FAIRtax Zombies), are usually extremely difficult because they cannot process info/facts/realities.

 

[Stephen Eldridge]

23%.
If the manufacturer acknowledges it delivered the serial numbered item for retail sale the ruse is spoiled.
That can of green beans is harder but nobody is going to fret about that nearly as much as the speedboat, Ferrari or gold toilet.
I worked IT for grocery distribution, medical supply, Coca Cola and multinational manufacturing. I know something about how and why companies track things.

Dogtowner, I am going to try this just one time. You have been fooled by the FAIRtax FRAUD. Yes, they claim its ONLY a 23% SALES tax, but you need to look a little deeper and understand how they came up with that FRAUD.

If something costs $100 BEFORE adding FT, they admit that the FT is $30 and the total is $130. And now you are scratching your head trying to figure out how the heck they got 23%. Are you ready for this? They say you should divide the $30 FT by the TOTAL of $130 and get only 23%. That FRAUD alone has caused many people to dump the FT garbage.

You will NEVER be able to account for all the goods sold by all manufacturers/suppliers.
Did you ever hear of keeping 2 sets of books? Goods are lost or destroyed. You must have heard of the term, inventory shrinkage?" Yes, certain high end products (Homes, cars, etc) will be more difficult to hide (taxpayers will even get around those as well), but most products will be easier to hide.

Your impression of the ability of auditing to track all goods is well beyond realistic. They cannot do that today and will not be able to do it in the future, when FT fraud will be the nation's #1 past-time.

 

[dogtowner]

Scot, it occurred to me later that you meant "plebes" instead of "plebs" that you wrote originally.

Yes, those people who constitute the FAIRtax target audience (i.e., the ignorant, the easily swayed people who cannot think and analyze on their own, and of course those with no tax education or experience), who has swallowed the FAIRtax Koolo-Aid and simply "believe" in it (I call them FAIRtax Zombies), are usually extremely difficult because they cannot process info/facts/realities.

Steve it's interesting how you love posting up links to biased sites that you parrot and bemoan.others who just read the legislation and theory from the source.
Not that you care but I'm not personally invested in ft flat tax or any other scheme. What we have is a carefully crafted mess written by the wealthy to protect the wealthy and enable the pols to buy votes to save the wealthy from buying new politicians. I would love to see something simpler that limits vote buying. I seriously doubt it can happen so I don't lose sleep fretting. But I do known the data us there that makes all this not only possible but easy.