Liberal free for all coming to an end

[smc]

Originally Posted by Suckslut

First off, I never said this would do away with the IRS. What it would do is cut it by about 90% and do away with filing income taxes for about 90% of people. Plus it would eliminate all the headaches associated with different tax rates for different kinds of income (wages, rent, long term capital gains, social security, deductions, loopholes, etc).

The IRS would only have to look at forms filed by businesses in the US (say 3 million) as opposed to forms filed by almost every single citizen over 18 (say 200 million)

Second of all, you are assuming everything will be 30% more expensive than it is now. That is not true. Income taxes are already figured in to company's margins and expenses. If I'm selling a product and I want to make a $1000 profit and the taxes are 33%, I'm going to sell it for $1500 (assuming other costs are $0, which they aren't, buy I'm trying to keep this simple). Now, with a fair tax at 33% and I want to make a $1000 profit, I could sell it for $1000 (again assuming costs are $0) and the customer pays the 33% tax for a total of $1,333.


I don't trust Republicans either, but I do like this proposal. In fact Mike Gavel, former Democrat Senator for Alaska is for this.

Taking your points in reverse order.

1. The fact that a Democrat is for this doesn't matter one wit to me. I do not support any politicians of the Republocrat Party.

2. I think you are being na?ve about prices to consumers. Businesses exist to maximize profits. Without some "fair tax"-related price controls, there is nothing to stop a business from continuing to charge the same as before. Sure, so-called "market forces" may result in adjustments of the sort you describe, but while you may be willing to rely on the market, I think we've had enough experience to known that there is no guarantee of the market adjusting in favor of consumers. (And I'm being kind to the market by only saying that.)

3. More to the point about prices, your construct seems flawed. Are you saying that the seller (i.e., a corporation) will no longer pay a tax? Seems to be what you wrote.

Most important, your proposal would replace a progressive tax (income) with a regressive tax. The solution is to fix the progressive taxation by making the wealthy pay more, not impose yet another hardship on working people. To be honest, you sound like the very thing you claim not to trust.