GOP pushing national sales tax again

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Doctor CamNC4Me
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GOP pushing national sales tax again

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https://www.semafor.com/article/01/18/2 ... -democrats
The idea of a “fair tax” that would replace our current IRS code with a single sales tax was popularized on conservative talk radio in the late 1990s. It has kicked around Washington ever since, popping up in the occasional presidential platform, but never received a vote.

Its current champion in Congress is Georgia Rep. Earl “Buddy” Carter, whose Fair Tax Act would swap out the income, payroll, estate, and corporate levies for a 30% national sales tax. It would also send out “prebate” checks to soften the blow on lower income families, all while abolishing the Internal Revenue Service.
I’m a cynic, so I’m wondering how this benefits billionaires and squeezes the poor and middle class. Anyone have any notions about a national sales tax essentially eliminating other forms of taxation? Too simple? Pie in the sky? A gift for the wealthy?

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Re: GOP pushing national sales tax again

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Sales tax is a highly regressive tax because lower income folks have to spend most of their income on food, shelter, clothing, and medical care. Adopting it in place of all other taxation would redistribute net income upwards.
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Re: GOP pushing national sales tax again

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It makes the cost of living expensive enough for illegal immigrants that they self deport.
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Re: GOP pushing national sales tax again

Post by Vēritās »

ajax18 wrote:
Thu Jan 19, 2023 1:41 am
It makes the cost of living expensive enough for illegal immigrants that they self deport.

Yes, we know that's the basis for the whole thing. Racism. It overwhelmingly benefits the wealthy and hurts working Americans.
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Re: GOP pushing national sales tax again

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Vēritās wrote:
Thu Jan 19, 2023 3:53 am
Yes, we know that's the basis for the whole thing. Racism. It overwhelmingly benefits the wealthy and hurts working Americans.
I don't see how, because wealthy people buy things, too.
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Re: GOP pushing national sales tax again

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Dr. Shades wrote:
Fri Jan 20, 2023 5:21 am
Vēritās wrote:
Thu Jan 19, 2023 3:53 am
Yes, we know that's the basis for the whole thing. Racism. It overwhelmingly benefits the wealthy and hurts working Americans.
I don't see how, because wealthy people buy things, too.
:lol:

Seriously?

In order for the government to maintain the same amount of revenue with strictly a sales tax the rate would need to be above 30% across the board. So someone making roughly $100,000/year sees a net income spike of roughly 17%. So with a sales tax of 30+% you're talking the same effects of having inflation being more than double what it is now. You know, the thing Republicans have been hyperventilating about for the past year or so.

Those effects are going to be much harder on those making less than $100k.

Meanwhile, those who make $1 million every year will see the same sales tax increase at about the same rate as their suddenly income spike. However those making millions and even billions will see a huge net income gain probably in the 10-20% range.

This of it this way. Roughly 40% of all American households will pay no federal income tax anyway. Why? Because they're poor. Over 70 million Americans. And you want them to pay an extra 30% federal sales tax on all their food and necessities?

This doesn't even take into account the sales taxes implemented already by the states. Given the dramatically reduced consumer spending that would undoubtedly ensue in the event that such a tax were enforced, the tax rate would need to be increased even more just to keep pace with current streams of revenue.

Consumer spending is the lifeline of any economy, and when you tank that, you crash the entire system. Republicans are damned illiterate morons when it comes to the economy. It isn't a coincidence that 10 of the last 11 recessions all happened under Republican administrations.
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Re: GOP pushing national sales tax again

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ajax18 wrote:
Thu Jan 19, 2023 1:41 am
It makes the cost of living expensive enough for illegal immigrants that they self deport.
According to DT they don't spend the money here anyway, they just send it to Mexico.
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Re: GOP pushing national sales tax again

Post by Alphus and Omegus »

Dr. Shades wrote:
Fri Jan 20, 2023 5:21 am
Vēritās wrote:
Thu Jan 19, 2023 3:53 am
Yes, we know that's the basis for the whole thing. Racism. It overwhelmingly benefits the wealthy and hurts working Americans.
I don't see how, because wealthy people buy things, too.
Wealthy people are much more likely not to spend their income, because they don't need to. And to the extent they do part with money, it's as investments, which would be untaxed.

So this bill would overwhelmingly increase taxes on middle income earners while drastically reducing them for the very wealthy. And the idea that the IRS would be abolished is false. Obviously, the federal government would need an agency to collect the sales tax.

The entire idea is a ludicrous fantasy.
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Re: GOP pushing national sales tax again

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Doctor CamNC4Me wrote:
Thu Jan 19, 2023 12:02 am
Too simple? Pie in the sky? A gift for the wealthy?

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Without understanding the particulars, it would not be a Republican proposal unless it was a gift to the wealthy. When I was young, Mormons were very upfront about why favoritism for the wealthy was to be endorsed: Because the wealthy were more valiant in the pre-existence.
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Re: GOP pushing national sales tax again

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Dr. Shades wrote:
Fri Jan 20, 2023 5:21 am
Vēritās wrote:
Thu Jan 19, 2023 3:53 am
Yes, we know that's the basis for the whole thing. Racism. It overwhelmingly benefits the wealthy and hurts working Americans.
I don't see how, because wealthy people buy things, too.

One of the main complaints about a national sales tax is that it’s regressive, if not accompanied with serious adjustments for income.

As example - a person earning $5 million dollars a year earns 100 times more than another person earning $50 thousand dollars per year. Does the higher income earner spend 100x the amount of the lower income earner on the following, per year:

- Milk, butter, or other food basics,
- Auto fuel,
- Natural gas, for cooking and heating
- Water and electrical,
- Toilet paper, toothpaste and other toiletries,
- Auto tires,
- Laundry detergent,
- Linens, bedding and clothes basics,
- A pound of coffee, or a package of bacon,
- Cell phone and internet service,
- A six pack of ale or cider from the local microbrewery,
- Refrigerators, washing machines and other appliances,
- Heating fuel … etc. ..?

Is their mortgage, or rent, or automobile cost 100 times greater than the person earning $50K? It would be hard to hit that mark.

How about health insurance? Medical costs? Day care?

Meanwhile, how much more of common infrastructure is required to allow the higher income earner to generate their income and to remain safely ensconced within the lifestyle that they are accustomed, versus folks much farther down the income ladder?
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