A Better Way to Screw You
January 10th, 2013 - 8:51 am
Hide your wallet — the legislature is in session:
But much of what Obama is talking about is raising tax revenue without actually raising tax rates. In Washington-speak, lawmakers will try to collect more tax money by closing tax loopholes, perhaps limiting popular tax deductions and to some degree changing the way citizens pay into the popular Medicare and Social Security programs.
If we must raise taxes (and we don’t), this isn’t such a bad way to do it. A better way would be to eliminate every deduction, every loophole, every everything. And then eliminate the income tax altogether, repeal the 16th Amendment, and institute the Fair Tax.
It doesn’t matter where you put your wallet if the government via the Fed can change the value of its contents.
Yes, repeal the 16th. It’s a violation of your right to your own livelihood – without which the idea of a right to your own life is just rhetoric.
The benefits to our overall economy with The Fair Tax are so enormous, I can’t see lawmakers turning up their noses if they are serious about doing what’s best for the nation. But, that’s exactly what’s happening because of their notion that they have a career instead of doing a service to their constituents
Wouldn’t the FairTax (basically a 20-some% national sales tax) require the government to intrude on and monitor all monetary transactions between citizens? Isn’t that scary?
I’d be hard pressed to think of a retail transaction that isn’t already true of. So no, since we already live under that regime, there are no new fears involved.
Before the 16th Amendment, the Federal government generated most of its revenues from excise — aka sales — taxes. Liquor excises alone counted for 40% of DC’s revenues before the First World War. That explains the political alliance between Prohibitionists and income tax enthusiasts — all that liquor revenue had to be replaced from somewhere.
All of this is a long way of saying, there’s nothing new here. In any case, the cash-under-the-counter portion of the economy isn’t all that big. And getting the IRS out of everyone’s everything would be a massive net gain for liberty.
Well, sure, except that currently sales taxes are local, and local governments don’t have the resources of the national government, and so don’t have the ability to do something horribly wrong that you can’t escape from. With local taxes, you can always move to a different locality with more attractive tax rates.
There are orders of magnitude more sales transactions than there are paychecks. I’d rather avoid expansion of government by orders of magnitude. Remember when Obamacare was going to require 1099 forms for all sales transactions over $600 (or some similar amount)? Remember the blizzard of paperwork that was going to generate?
The 1099 issue is not comparable to a sales tax.
The 1099 debacle would have required indies, micro and small businesses to track and report purchases which during that tax year exceeded $600 from any one vendor. Spend $100 a month at Staples for 6 months? You’d need to set up a system to track and issue a 1099 to Staples/whomever.
The 1099 thing was a blatant attempt to have everybody report on everybody else, so the IRS could have even bigger, stickier fingers stuck into taxpayers’ lives, businesses and transactions. And yes, it would’ve created a blizzard of paperwork and an army of IRS agents to process that blizzard.
In contrast, vendors who charge sales taxes already have collection and payment systems in place. A sales tax spreads the tax burden across the general populace (including illegal aliens). It focuses on public transactions, so it increases personal/financial privacy and removes government’s obsession with your income. It gives everyone more control over how much they pay in taxes. Spend less, pay less in taxes.
The Fair Tax was actually a 30% sales tax (they called it 23% because 30% is 23% of 130%). Unfortunately, it’s high enough that you’d have some serious compliance issues.
The Fair Tax was a 30% national sales tax on all transactions, services (I believe) and products (it was called 23% because 30% is 23% of the 130% total sale price, but that’s not a conventional way of calculating sales tax). Unfortuntely, it’s high enough that you’d have some serious compliance issues which would necessitate some government agency, probably bigger than the current IRS, monitoring all sales.
“…repeal the 16th Amendment, and institute the Fair Tax.” We have a winner.
Fair Tax … so crazy it just might work!
Might I also echo the good professor, in repealing the Hollywood deduction, as well as the various loopholes such as ‘Hollywood accounting’?
Take my earnings, now yours to benefit from.
Soak the earth with cheap loans, to the benefit of BIG banks and BIG time-share barons, and of course, to the lenders.
Incentivise me to spend spend spend my earnings, to the benefit of my neighbors, and to the benefit of not-my-neighbors.
Disincentivize me from saving, from carefully risking my monies on what will improve my standard of living.
Provide cushy tax credits to gray-haired asset-owners, people with 6 kitchens.
A liquidity trap?
Whatever you call it, this economy has one problem:
It isn’t worth my time.