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Supposn
08-27-2010, 02:11 PM
I am a proponent of the “fair” tax; a general consumption tax that would replace our income taxes (to whatever extent feasible).

The root cause of much income tax inequities is due to our progressive income tax rates. Progressive income tax rates’ purpose is to promote a good and justifiable policy that we provide some tax relief for lower income earners. We simply didn’t realize or appreciate the extent of mischief due to our choosing progressive income tax rates as the method to achieve that purpose.

Each perceived or actual tax inequity induces a modification of our tax regulations; each of these remedies are in turn actual or perceived to be inequities to other factions that in turn lobby for still another regulating remedy. Our income tax regulations grow as a great onion under the ground; they’re layers upon layers of additional inequities.

Due to these additional tax inequities and loop holes the actual purpose of progressive rates, (to provide some tax relief for lower income earners) are severely undermined. Due to this and our FICA payroll tax are now the cause of our lower income wage earners being taxed much greater (than intended) proportions of their incomes. [Employers' portions of FICA serves similar to a sales tax except they additionally inhibit job creation. Due to this, FICA's an additional drag upon our nation’s economy and particularly detrimental to the incomes of families more dependent upon wages and salaries].

We fail to acknowledge the actual portions of working poor’s’ wages that paid for taxes. Middle income wage earners pay greater rates. Significant tax loop holes and considerations are more available only to speculators and much less available to entrepreneurs that continuously reinvest their efforts and revenue to cultivate and actually nurture their enterprises. Similar tax considerations are completely unavailable to wage earners. Progressive income tax rates lesser burden upon the lower and middle income earners is more a fable rather than an actuality.

Respectfully, Supposn

Supposn
08-27-2010, 02:23 PM
I would hope that no U.S. president or congress would be so imprudent as to attempt transferring our nation’s major revenue source in a single step.

Any problem encountered within such an extremely huge scale of tax modification would be financially disastrous. There’s much less down side to multi-step simultaneous transfer of revenue sources. Those that will accept only a single step transfer must also accept that a federal sales tax will never be enacted.

I believe that an acceptable rate of sales tax could not feasibly replace the entire revenue we derive from income taxes, (i.e. the “fair tax”). If I’m wrong, sales taxes could completely replace income taxes. If I’m correct, after some incremental step the sales tax rate will approach an unacceptable rate and the transfer of the tax sources will have to be halted or interrupted.

Respectfully, Supposn