Sunday, March 14, 2010

Fair Tax- Fair to Whom?

Here's the latest vampire-like rebirth of the real Republican agenda, from Alan Caruba at Renew America:

"We want a "Fair Tax" NOW!"

Well, goodness gracious, who could ever disagree with a fair tax? Of course, let us note, on closer observation, that what Mr. Caruba and other conservatives are promoting is not a fair tax, but a "fair tax." Now, what, pray tell could a "fair tax" turn out to be:

"The Fair Tax, which would replace only federal taxation, is based on what we individually consume. It is paid at the point of sale and it does not take earnings from one's paycheck, nor punish you for having a savings account or for capital gains as the result of investing wisely. A Fair Tax says your money is your money."

Now, please observe two things. first, this tax (in fact a national sales tax) would be based on "what we individually consume." Getting the idea? That would not include corporations. Yes, what Mr. Caruba is advocating is doing away with corporate taxation. Read the article and see, if you don't believe me.

Second, notice that he specifically excludes capital gains (i.e. the principal form of income for the rich) from taxation.

So there you have it- what's "fair" is not taxing the rich or corporations, and transferring the total burden of their share of maintaining this country to the rest of us.

This is the 100% sum and total of what the Republican party is about. Don't ever let them fool you into thinking anything else matters to them.


Derek said...
This comment has been removed by a blog administrator.
Green Eagle said...

Once again, I have deleted a post from Derek, which was nothing but a compendium of ignorance, lies and Republican talking points.

Sorry, Derek. Say something that is honest and I will leave it up. If you can't tell the difference, you need to stop commenting on other people's blogs.

Derek said...

You blatantly lie about the fair tax, I correct you, you delete my comment.

Sounds like a Democrat to me.

The Fair Tax: Any purchase not made by someone under the poverty line includes a 22% national sales tax. It doesn't matter who is the buyer. Corporations, you, me, Obama, we all would pay the tax.

That is the truth, and GE is apparently trying to hide it from everyone.

Grow up GE.

magpie said...

(Derek, I composed the following earlier today before you wrote your second comment there, so please don't think this a response to you. No offence, but I'm just not interested.)

Introducing this kind of consumption tax can pose a risk.

We had this experience with it:

In 1998 our conservative government of the day broke (surprise) its explicit promise to “never ever” introduce the GST – the goods and services tax. A broad-based consumption tax. A hugely expensive campaign to 'sell' the GST followed - funded by the very taxpayers about to be hit with it.

Consumers rushed to buy goods before its introduction.
Once it was in... consumption dropped so much that by fiscal quarter one of 2001, the Australian economy recorded negative economic growth for the first time in over a decade.

It did rebound eventually, but in our case the GST was introduced with a swath of other measures to ensure (in theory) that lower income households would have nil total impact as a result of its introduction. That was in response to people pointing out that this new tax would slog low income earners by a greatly larger proportion of income than high income earners. It is currently 10%.

I’m assuming no such provisions would accompany a 'Fair Tax' of course.

It really depends on what the intent is. It’s not necessarily a wholly bad thing.
Ours was introduced to lower administrative costs and, most importantly, a massive amount of revenue from the GST is distributed back from the federal treasury to the states and territories, enabling them to funnel it back into public works, infrastructure and all that other stuff that keeps employment up and the economy moving.

But I doubt very much you would ever see your money again in any manner aligned with the public interest in your case.

Another point is that ours was introduced during a period of a more stable and healthy economy.
Doing this to an economy as fragile as the US one is right now with unemployment over 10%, and nothing nice will come of it.

And it surely won’t be enough to support military spending (for just one thing) on an American scale, if it is meant to replace existing taxes..

Derek said...

"Doing this to an economy as fragile as the US one is right now with unemployment over 10%, and nothing nice will come of it."

Yours was obviously quite different than the Fair Tax as the Fair tax replaces all taxes with a national sales tax. The price of goods is unlikely to increase because products currently have taxes built into their cost. Corporate taxes, business taxes, income taxes, property taxes, payroll taxes, etc. The fair tax gives everyone more money to spend/save so it follows that businesses would expand and hire. We could solve our economic crisis in a week under the fair tax.