I came across an extensive argument against the Fairtax, as well as the same people listing some alternatives.
This comprises their argument against the FairTax-
http://fairtaxfraud.com/fair.asphttp://fairtaxfraud.com/fallout.asphttp://fairtaxfraud.com/alternatives.aspIs that argument sound? What parts do you agree with or disagree with?
With that, these guys have also suggested some alternatives. Would any of these make a good alternative to the FairTax? What is wrong or right with each? How should each of these be modified to even be practical or worthwhile? Myself, I'm still having the feeling both these alternatives and the FairTax overlook lots of things.
http://fairtaxfraud.com/alternatives.aspThe No-Tax Plan:
How about a plan where everything you earn is tax free - period. No income taxes, no sales taxes, no business taxes, no fees or tariffs. As long as you earned the money by using your muscles or your brain you get to keep 100 percent, and your can do or buy anything you want with it without taxes. Get your entire paycheck, spend or save without any taxes, fees, tariffs, or anything that would increase the price of good or services. Absolutely no business taxes as long as all your employees work in America.
That's not the half of it. There will be so much money coming into the treasury that every American can have 100 percent free health care, free prescription drugs, free surgeries, free dental and free optical, and even free plastic surgery! You can have free education, free college, free classes, free certifications. There will be enough money in the first year to pay off the national debt, fund the military at current levels, fix all the roads and bridges, and help every poor person to get off welfare.
So what's the catch? Money you didn't earn or work for is taxed at 50 percent - no exceptions. Why? Because it's welfare and that is un-American. Money that you get for free is taxed. This includes inheritance, gifts, lottery winnings, gambling winnings, interest income, income from stocks, bonds, etc. Companies that outsource labor will have to pay a large tax. (because their profit wasn't worked for or earned by Americans) Privately held corporations must convert to publicly held corporations or be liquidated when the owner dies. It's a very simple concept. Retirement funds and 401K plans are tax free because you earned them and the yearly contributions are limited.
Where does all the money come from? Currently just the top few percent of the population owns or controls 70 percent of the wealth. Notice I said wealth and not income. Income is a fanciful term dreamed up by tax lawyers and tax accountants that has virtually no basis in reality. A billionaire can, and sometimes does, show zero income on his tax return. (If you own the company you can reward yourself in many other ways than giving yourself a high salary). Wealth, on the other hand, is net worth. All the things of value that you own like property, houses, boats, stocks, bonds, investments, etc. These are things that can not be easily removed from America or hidden like income can. They can be accounted for and seized if necessary. There is so much wealth in America that taxing wealth could fix all of Americas debt problems in one tax year. While the FairTax billionaires whine about how people hide money outside the country, with the No-Tax Plan that all goes away because real estate can't be moved, stocks and bonds are registered, and banks won't lend people money without collateral.
This would eliminate all tax-free shelters, trusts, foundations, and would provide incentives to work hard and be productive. Business would have no taxes and not need to worry about deductions or liabilities. As long as they provide a product or service using American labor they will never pay a red cent. No more sin taxes, luxury taxes, property taxes, cigarette taxes, or any other taxes on money you worked for and earned. Foreigners would have to move themselves and their wealth to America to benefit.
The FairTax is more like Communism. Everyone is supposed to be equal but, in reality, there is a ruling class consisting of wealthy old money heirs who contribute nothing to society. The No-Tax plan is more like what our founding fathers intended - people who work hard get to keep and spend all they work for tax free.
Our current tax code is a lot like an oligarchy. Privately held companies are passed to heirs of royal blood like a monarchy. It's almost as if the United States has many little kingdoms within it and these sons and daughters of self made people are royalty. Most people can respect an entrepreneur, a guy that risks all to start a business, and becomes successful. But nobody respects the boss's son taking over a company - someone who didn't work for the job, didn't sacrifice for the job, or earn the job by deeds instead of having a monopoly on royal blood. When money gets passed on like this the entire capitalist work ethic suffers - innovation, incentive to work hard, earn a living, take risks, and start businesses all suffers. Companies run by heirs are more likely to get involved in the political processes than keep their mind on innovation and productivity. They run for office to change laws in their favor, rather than coming up with new and better ways to do business. They try to kill competition rather than put more people to work. They outsource rather than evolve. They litigate rather than invent. That's why the No-Tax plan is a tax on unearned income and ill-gotten wealth.
We are currently looking for a congressional sponsor to help us get the No-Tax plan into a bill that can be introduced to Congress.
The Pro-Family Flat Tax Plan:
All basic necessities of life are completely tax free up to any amount (food, rent/mortgage, utilities, healthcare). Then one tax rate for everyone above that amount - 35 percent. No deductions for anything else. Same tax rate for corporations. The estate tax, gift tax, and capital gains taxes are eliminated -- Instead, all incoming money as estates or property will be treated as income -- which it is.
Rich people can have one expensive house, and eat expensive food, and pay no taxes on them, and poor people can make the most of their meager dollars getting nutritious meals instead of cheap starchy food or fast food.
There is a 35 percent tariff to retailers on all imported goods and services not provided by or manufactured by members of American families.
The European Dual Tax Plan:
All of Europe, Canada, Japan, Singapore, and Australia currently pay taxes under a dual tax plan that is one part Income Tax and one part Value-Added Tax.
The way it works is first you exempt all households under a certain amount from paying income taxes; say $150,000 per year. This will eliminate the need for about 90 percent of the country from having to file a return. Anyone making over that amount will pay a 30 percent income tax. Then you create a Value-Added Tax that is locked in a low rates for necessities (5%) and higher rates for luxuries (15%) that can go up or down. The value added tax is paid at each stage of production, and then refunded to the manufacturers when the finished product is sold. For example, for a luxury car, the manufacturer might pay $500 in taxes for the steel used to build the car, the car dealer might pay $1000 in taxes before he sells it. However, when the car is sold, the full tax is collected ($2500) and then the government sends $1000 back to the dealer and $500 back to the manufacturer.
It may sound complex but it completely prevents cheating. Unlike other flat taxes (FairTax Plan) where the salesman could pocket the sales tax and not report it, there is a documented existing chain of people who need their money back when the car is sold so no one can cheat without the others knowing.
Under this system all inheritance is just treated as income and taxed accordingly and fairly.
The Representative Tax Plan:
Most people hate taxes because they have no say in where their money is being spent. Conservatives don't want their money spent on stem cell research, offensive art, welfare programs, public television, endangered species protection, etc. Liberals don't want their money spent on unjustified wars, ridiculous government contracts, tax breaks for religious groups, organizations that spy on American people etc. Even if we can't pass a revolutionary new tax plan we can at least give the American people a say in where their money goes.
We need a law that says:
1. Everyone who pays taxes is allowed to determine where those tax dollars go. When you fill out your tax return there should be a choice of 20 areas of the government to choose from on your tax return form. You simply enter the percentage of where you want your money to go into each of the areas. If you want to put all your money into defense then you can. If you want to put all your money into social programs you can do that too. There should even be an area on the form to put tax money toward the national debt.
2. The government can not borrow money - ever! The budget must be balanced and must be according to the budgets set above in part #1. No borrowing from other budgets and no emergency borrowing - even in war time. If a war is declared then an automatic WAR TAX should kick in. If a WAR is declared on terrorism then an automatic TERRORISM TAX automatically kicks in. If the president declares a WAR ON DRUGS then an automatic WAR ON DRUGS TAX kicks in. When people decide that the war or emergency is over then the tax goes away. This way politicians will think real hard about starting an unjust war or declaring a virtual war, and war will always be a last resort because of the tax attached to it.
This would solve our lobbying problem. It would make sure that tax money is going for what the taxpayer wants and nothing else.
I came across these while browsing yesterday. I was wondering what everyone here thought of each of these.
Fee-For-Service Government:
Some believe in minimalist government, that you should only pay for the government you use and nothing more. This tax system would be built on fees. There would be fees to drive on roads to support their construction. If your business in a foreign land is being targeted by terrorists you pay the military to defend your assets. You subscribe to police services, inspection services, and legal services. Government would need no president or congress because everything was based on the fees received.
Are any of these too regressive? Could they be seen by some as even being too progressive? If both all of these and the FairTax are ineffective solutions, what do you think would be an alternative that everyone agrees with and benefits everyone on both sides?
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