Replace All Federal Taxes on Income with the Fair Tax Act , HR 25 and S 122
We can dig our way out of the current financial mess we are in!?!
The power to tax is the power to destroy. .
Seems like we want to be careful about what we let our government destroy.
Sort of an enumerated powers applicable to all levels of government might be useful at least as a thinking tool.
It seems that social engineering is always divisive, toxic and provides opportunities for corruption.
Social engineering by taxes, tax breaks, and subsidy is no different but more so.
The removal of that propensity towards corruption is worthy but has hard to quantify costs and benefits.
Saving the work-life being wasted in the industry having propensity
towards corruption is easier to measure.
A) I wonder how much our productivity and production would increase if 99.5% of tax accountants, tax lawyers and tax bureaucrats where doing something actually productive rather than gaming the system. . . my eyeball survey of certain parking lots guesses that there are 3 persons so employed for every farmer. If farmers are still 3% of workers then it seems we could have 9% more real labor force time, perhaps equivalent to 9% increase in real GDP, just by blowing that stuff into some useful truly useful employment.
B) I wonder how much of that other 91% of the labor forces time would be available for doing actually good things if we could get our tax collection system that right and simple. Lets call that yield 2% of the labor force time, estimate it as a 2% increase in real GDP.
The misspent work-lives and other resources caused by tax distortions on the market I cannot even begin to measure directly.
My guesstimates on components, and proxies for components, that compose that economic waste created by tax distorted markets varied so wildly that I have tentatively settled for the proposition that this waste my not be as significant as I thought. The reality check on the high guesstimates would be the cost of economic dislocation that would become apparent if the tax distortion was to suddenly stop. Just like stopping a speeding car the cost of the speeding is dependent on the rate of the stopping.
If the above 11% of GDP [ 9% in A) + 2% in B)=11%) was shifted from frothy illusory GDP to real substantial GDP by legislating a five to ten year
phase out of the corruption & waste inducing tax driven distortion then
both the stability of the law and the certainty of a tax distortion sunset
would encourage those persons in that 11% of GDP to change jobs to something
more productive at an orderly rate.
Likewise the business and investment tax driven distortions would also
be removed at so orderly a rate that the market is not traumatized. That practically free 11% increase in our real GDP increased the base of all future growth by that amount - a drag laden 3% economic growth in GDP would be able to produce a drag pared 3.33% economic growth in GDP.
Let us assume that our country suddenly recognizes that all delegations of legislative authority embodied in the Code of Federal Regulation is UNCONSTITUTIONAL & VOID as is ALL the past legislation that delegated that authority.
Now the IRS has no legal standing and no employment short of felony in the personal capacity of IRS employees.
Now Constitutional replacement legislation is needed immediately. By
Constitutional congressional model legislation authorizing interstate compact
the states are authorized and required to collect federal sales taxes on all
new product sales at a country-wide uniform rate. Existing tax breaks would be
implemented by tax refund. Tax refunds are limited to citizens, legal aliens and citizen businesses. The tax is made as an effective savings account for the relatively impecuniary.
There are other details to smooth the transition and other taxes to eliminate and roll into one collection mechanism for all local, state and federal domestic taxes but they need not be raised now.
NOW we have no less that an 11% increase in our REAL GDP.
Continued:
Replies to This Discussion
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Permalink Reply by Russell Patton Davis on
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RELATED BUSINESS RISK REDUCTION
And we reduce that amount of government induced risk that business face by removing the CFR and its capricious enforcement under possible criminal penalty that was used to shakedown business and punish those out of political favor.
Those portions of the federal executive branch, like the EPA, that also fall when the CFR is discovered to be largely UNCONSTITUTIONAL & VOID. Constitutional replacement legislation is needed immediately By Constitutional congressional model legislation authorizing interstate compact the states are authorized and required to implement country-wide uniform if they wish for their citizens to have remedy to violations by citizens in other states.
Reducing businesses risk premium on investment that they need to cover the government caprice induced risk to every new investment will have benefit every year. State enforcement of interstate compacts rather than a capricious mix of state and federal enforcement will likely cut the full cost of every new investment by 5%, reduce the lead time required to embrace a business opportunity by 80%, and reduce the required total annual return on investment to justify an investment by some 3% per year. Those are just my eye ball estimates - what are your estimates?
Maybe we can dig our way out of the current mess we are in! We just need to say NO! to BHO’s crew & RINOs before we can honestly say YES! to our children and grandchildren.
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Permalink Reply by Terry Warns on -
I think the Unconstitutional argument is an extremely poor one considering that there are so many great arguments and discussion points about the Fairtax.
In fact, your whole argument does little to address how we can use the fairtax to get us out of our current economic situation.
Let look at 3 major news items, Social Security, Health Care, and the Auto industry.
With the Auto industry, we reduce the cost of building autos by about 20% and simultaneously increase the cost of importing vehicles by 20%. This means a US built auto valued at $25K would be $20K and would be competing with a foreign built auto at $20K. This would be a major price advantage to domestically built auto and would generate jobs throughout the auto industry our largest manufacturing segment.
Social Security base increases from workers to all consumers. This alone should save social security.
Health Care reform did not decrease the cost of health care. However businesses would see a 20% reduction in health care and those without insurance would get penalized because they have to pay the fairtax.
The bottom line is this. FAIRTAX has many great economic arguments to make about the current mess we are in. However suggesting that the Income tax is Unconstitutional is the weakest. And to say no to BHO + RINO is completely partisian and inflamatory.
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In reply to Terry Warns at http://www.fairtaxnation.com/forum/topics/we-can-dig-our-way-out-of... :
I take it that the Constitution is not one of your top considerations.
That says much for the soundness and lawfulness of your remaining considerations that cannot otherwise be readily tested.
I have wondered why 'Fair Tax' creeped some people out so much that they were driven to think FLAT TAX was very workable.
When avoidance, deflection, dissemblance, equivocation and Saul Alinsky tactics confounds the language of rational discussion it is likely that those who speak such language are of the camp that finds positive utility in the Vladimir Lenin quote, "If you want to conquer a nation, you must first confound it's language." Initially the Fair-Tax brand's use of the progressive's highly baggaged wedge-word 'FAIR' warned me away from looking at Fair-Tax until the unconstitutionality of the IRS became an issue. That initial impression appears correct. Perhaps some of Fair-Tax's work may be salvageable in a "State Collected National Sales Tax".
Given the toxic language used by progressives there is no profit in allying with progressives unless it is merely a crumbs-of-the-feast type of alliance fit for low value dogs. That is just the way it is. Your compulsive taqiyya and kitman set you apart and make partisanship unavoidable short of complete victory.
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Permalink Reply by Terry Warns on
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Your title is:
We can dig our way out of the current financial mess we are in!?!
Your solution is declaring the income tax unconstitutional.
Your solution has nothing to do with the current financial mess we are in.
Not only that your solution will not convince most decision makers.
In our current climate, inorder to get a constitutional amendment will take decades to accomplish. To get the income tax declared unconstitutional by the courts will take longer.
We need the fairtax in years not decades.
There are better arguments to dig our way out of the current financial mess we are in. I gave three.
Finally, the FAIRTAX is bipartisian. In order to gain support, Fairtax needs to be bipartisian and that includes moderates and progressives from both parties. Making statements like the following:
Given the toxic language used by progressives there is no profit in allying with progressives unless it is merely a crumbs-of-the-feast type of alliance fit for low value dogs
does nothing in advancing the fairtax, and even will hurt it. No one will come to the table when they are treated like low value dogs.
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That was too weak to be worth answering. Happy trails pilgrim.
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Permalink Reply by James Russell on -
Russ, I sorta understand you... because I am somewhat smart... I may have missed alot of your story...
but I like your thoughts. If you are for the FairTax and you want to create a team that will help bring the FairTax into our economy without creating waves... then sign me up.
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Permalink Reply by James Russell on
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The 16th amendment can be abolished, and we need teams at every state level to insure the collection of the FairTax goes smoothly in the first few years. Keep thinking deeply about this. I would be waiting for more of your creative thinking to appear again.
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Permalink Reply by Dan Hunt on
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I'm not sure what you mean by "teams" to collect the Fair Tax but the bill will have businesses collect the tax and give states the option to collect the tax and, along with businesses, will be compensated one quarter of one percent for all taxes remitted.
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Permalink Reply by James Russell on
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Bravehearts, when the FairTax becomes law... the 16th amendment will not automatically be repealed. The FairTax and our "teams" must assure that every cent, every facet of the tax law is carried out. That is we need to assure that every class gets to keep as much of their spendable earnings.. that the economy grows and many of us can be put to work... in a paying job... on a team... to oversee the collection of the the revenue for their state.
I cannot enjoy life until... Uncle Sam and free enterprise and the american worker can be free of the complexity of our income taxation codes.
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Permalink Reply by Dan Hunt on
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The only constitutional way to reduce the size and scope of government is to return to the enumerated powers listed in Article 1 Section 8 of the Constitution. Eliminate all agencies and federal programs that do not comply with any of the enumerated powers, including the EPA, Department of Education, FCC, FAA etc...
This does not address the federal income tax code as the power to levy and collect taxes is an enumerated power. Therefore collecting tax on the federal level, in any form, is constitutional. This leaves a choice of repealing that provision in Article 1 Section 8 by one of the procedures described in Article V or merely changing the method of federal taxation from income to consumption.
Constitutional replacement(repeal) cannot happen immediately as Article V requires either Congress to repeal collecting federal taxes by 2/3 of both chambers or by convening a Constitutional convention by 2/3 of state legislatures and then ratified by 3/4 of the state legislatures or Conventions in 3/4 of state legislatures. Keep in mind a Constitutional Convention has never occurred and would apply to any portion of the constitution not just repealing the enumerated power to collect a federal income tax. Either scenario will take considerable time.
It is far more expedient to pass a bill, in this case The Fair Tax, that on average takes far less time to pass and concurrently work to repeal the 16th Amendment through House Joint Resolution 16, knowing that the Fair Tax Act contains a sunset provision whereby it will be repealed if the 16th Amendment is not repealed within seven years from the time The Fair Tax is enacted.
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Yes, Dan Hunt, legislating Income Tax Law is an enumerated power of Congress.
But Congress does not have Constitutional authority to delegate the creation of substantive law (Legislation) to the executive branch for inclusion in the executive branch's "Code of Federal Regulations" that may constitutionally only delineate the due process of law the the executive branches will use to regulate the administration of our law prior to any necessity of adjudication.
Notice the conflict between Const.A1S1’s “All legislative powers” and 5USC551’s “(4) ‘rule’ means” . . .” prescribe law”. I believe both the IRS and the EPA are in the category of agencies that have unconstitutional enabling legislation that wrongly relies on the CFR to ”prescribe law” – substantive law - rather than just delineate the due process of law the the executive branches will use to regulate the administration of the laws Congress legislated.
It is much less work to void laws as being unconstitutional , by whatever means, than it is to legislate revocation and replacement.
Now that it is obvious that the old law is void, getting teamwork of a timely proper replacement should be much easier.
Proper has both scope of mission, jurisdiction of implementation, and budgetary aspects.
Getting a timely and proper replacement for the IRS and Income Tax is probably the most complicated of all such proper replacements. The other will be much easier if this is handled first and handled well.
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I am not entirely sure what 'Fair Tax' is.
My hopes are that it is:
- a national sales tax -
- a consumption tax -
- a tax with low collection and collateral costs -
- a tax that could embrace most other taxes and so eliminate them -
- a tax that would have minimal distortions on the marketplace and where all the avoidable distortions were avoided and in doing so replaced many government programs and subsidies -
- a tax that would advance our competitive position in international trade -
- a tax that would eventually collect all the funds that are really needed by the general operation of our federal, state and local governments excepting well balanced user-impact-fees
How close is the FairTax, as currently tuned, to meeting those specifications?
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