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Thread: FairTax

  1. #1
    Senior Member Hysterical's Avatar
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    Default FairTax

    I would love to hear some opinions on FairTax. If you don't know what it is, it's a proposed tax system in US that would abolish the payroll tax and tax money spent, not money earned. More info here: http://www.fairtax.org/site/PageServer?pagename=FAQs#3

    I find this very interesting: "Under the FairTax, small businesses enjoy a zero tax rate. And zero compliance cost.
    Corporations, subchapter S corporations, partnerships, limited liability companies, and sole
    proprietorships pay no tax on their income."

  2. #2
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    Default Re: FairTax

    From my POV, I think a progressive income tax is more fair because how much people consume doesn't always correspond with their ability to pay tax. While it does make some provisions to help poor families or large families, I think it makes it much easier for very wealthy people to avoid paying a lot of taxes.

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    Banned Melonie's Avatar
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    Default Re: FairTax

    i'm a bit reluctant to comment on tax policy because of the political overtones. However, since others are chiming in ...

    the details of the 'fair tax' would potentially increase 'real' tax rates paid by the middle class. This is primarily attributable to the fact that the 'fair tax' would eliminate deductions for such things as home mortgage interest paid, property taxes paid, state income taxes paid etc. This would predictably drop negative fallout on the housing market by significantly increasing the actual all-in cost of 'home ownership' by several thousand dollars per year. it might also raise rent prices to compensate for the landlord's loss of mortgage interest and property tax deductions. And this would increase the differential in overall tax rates paid by persons living in high income tax states versus persons living in low / no income tax states.

    Whether or not the 'fair tax' actually increases 'real' tax rates paid by the very rich depends on the nature of their high income. Tax free muni bonds would remain tax free. Secret offshore accounts would remain secret.

    As to small businesses paying a zero tax rate, that doesn't automatically equate to the business owner also paying a zero tax rate.

    As with any type of tax policy, the devil is in the details.

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    Default Re: FairTax

    The fair tax is regressive..... The best way is to start over.... Ged rid of all deductions.... Tax all income at the same rate Active or passive.... Less the first $15,000 or so.... Eliminate Fica taxes.... The Federal rate would have to be higher once you eliminate Fica taxes..... But this would be a fair solution.
    The country has been looted.

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    Default Re: FairTax

    ^^^ I would add that, based on a very recent NY Supreme Court ruling which relied on doctrine laid down by the US Supreme Court in an earlier case ( ERIE vs paps ), lap dances, VIP rooms, etc. are not considered to be 'Art' for legal purposes and as such are fully taxable. Thus the enactment of the 'Fair Tax' could very well impose a ~23% ( or whatever ) additional tax on every lap dance and VIP room sale. Similarly, a ~23% ( or whatever ) additional tax could be imposed on every US webcam customer credit card transaction.

    And monitoring the collection of this additional ~23% ( or whatever ) tax would absolutely lead to much closer monitoring of the sales revenues = incomes of strip clubs, dancers, and camgirls. It's very reasonable to expect that the US gov't will expect weekly or at least monthly forwarding of that 23% tax ... meaning that dancers who receive private dance money directly from customers would be required to keep detailed records of their total private dance sales, and to cut a check to the gov't once a week / month for 23% of that total.

    In terms of 'marketing', adding a ~23% federal 'flat tax' plus a ~7% or whatever state sales tax to the price of lap dances etc. will absolutely require a price increase to allow the dancer to 'break even'. With a ~30% combined tax rate on lap dances, in order for the dancer to 'break even' on present earnings from ( untaxed ) $20 lap dances, she would need to increase the sale price to $30. Whether or not strip clubs customers would be willing to spend $30 on a lap dance instead of $20 without expecting more 'bang for their buck' from dancers, and whether or not those strip club customers would be willing to buy an equal number of higher priced lap dances, is of course a whole 'nuther question. And the same point applies for US webcam customers who could now be charged $6.50 per minute ( with taxes ) instead of $5.00 per minute ( untaxed ).
    Last edited by Melonie; 10-31-2012 at 10:48 AM. Reason: fr

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