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From: dagmargoodboat on 17 May 2010 16:48 On May 17, 3:09 pm, John Larkin <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > On Mon, 17 May 2010 12:57:38 -0700 (PDT), dagmargoodb...(a)yahoo.com > wrote: > > > > >On May 17, 12:29 am, John Larkin > ><jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > >> On Sun, 16 May 2010 21:09:07 -0700 (PDT), dagmargoodb...(a)yahoo.com > >> wrote: > > >> >On May 15, 9:27 am, Bill Sloman <bill.slo...(a)ieee.org> wrote: > >> >> On May 14, 10:52 pm, John Larkin > > >> >> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > >> >> > On Fri, 14 May 2010 11:29:35 -0700 (PDT),Bill Sloman > > >> >> > <bill.slo...(a)ieee.org> wrote: > >> >> > >On May 14, 5:18 pm, dagmargoodb...(a)yahoo.com wrote: > >> >> > >> On May 14, 9:51 am, John Larkin > > >> >> > >> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > >> >> > >> > On Thu, 13 May 2010 22:16:49 -0700 (PDT), dagmargoodb...(a)yahoo.com > >> >> > >> > wrote: > > >> >> > >> > >On May 13, 5:02 pm,Bill Sloman<bill.slo...(a)ieee.org> wrote: > >> >> > >> > >> On May 13, 8:20 pm, dagmargoodb...(a)yahoo.com wrote: > > >> >> > >> > >> The argument for progressive taxation is usually put in terms of those > >> >> > >> > >> with the broadest shoulders carrying more of the load. > > >> >> > >> > >Right. That's how the Little Red Hen got a hold of all the other > >> >> > >> > >animals' bread, greedy thing that she was. She had broad shoulders. > > >> >> > >> > >> This falls a > >> >> > >> > >> long way short of Marx - > > >> >> > >> > >Marx was kind of an idiot. > > >> >> > >> > >"The average price of wage labor is the minimum wage, i.e., > >> >> > >> > > that quantum of the means of subsistence which is absolutely > >> >> > >> > > requisite to keep the laborer in bare existence as a laborer." > >> >> > >> > > --The Communist Manifesto > > >> >> > >> > > See what I mean? > > >> >> > >> > Yeah, he wouldn't understand a female plumber making $150K. > > >> >> > >> > What created our modern wealth was engineers applying science. > > >> >> > >> Yep. They made machines to relieve human toil, to improve the human > >> >> > >> condition. > > >> >> > >> Evil capitalists. Marx the Moocher should've stopped 'em. > > >> >> > >Some of the capitalists were quite evil, as Martin Brown has pointed > >> >> > >out elsewhere in this thread. Trade unions were one of the mechanisms > >> >> > >that reigned in the greedy, evil, short-sighted minority. > > >> >> > No. Competition did. > > >> >> Comptetion was one of the other mechanisms, once anti-trust > >> >> legislation had forced the greedy, evil and shorted sighted > >> >> capitalists to compete rather than conspire. > > >> >Conspiring is harmful. Why, though, is it bad for capitalists, yet > >> >infinitely good for labor? > > >> >Conspiracies among competing capitalists are inherently unstable. Like > >> >OPEC, the players have competing interests; squabble, the alliances > >> >fall apart, and they resume competing for advantage. It's a beautiful > >> >thing. > > >> >James Arthur > > >> So we don't so much need anti-trust laws, as long as murder is > >> illegal? > > >To the contrary--anti-trust should apply to labor, too. E.g. > >government unions. > > Agreed; all unions. Sure. A union is nothing more than an attempt to monopolize labor. > But what ever happened to Jimmy Hoffa? http://kenlayisalive.org/ken_lay_sightings.php -- Cheers, James Arthur
From: dagmargoodboat on 17 May 2010 16:49 On May 17, 3:13 pm, John Larkin <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > On Mon, 17 May 2010 13:07:05 -0700 (PDT), dagmargoodb...(a)yahoo.com > wrote: > >b) The Fair Tax economists calculate that when you buy a $1 item, 23 > >cents of the price of that item goes to covering the various taxes > >that the people who made the item had to pay. > > >That is, if your laborer has to pay income tax, you have to pay him > >more to compensate, and you have to raise your sales prices to recover > >that loss from your customers. > > >c) So, when you buy an item, you *are* paying all the taxes of all the > >people and entities that made the item. > > Only if the product was made in the USA. If it's imported from China, > it didn't generate those taxes, certainly not into the US treasury. > > A sales tax would apply to all sales, US or Chinese made. That would > be a boon for domestic industries and jobs. And a boon to federal revenue--it makes imports pay "their fair share," which should please protectionists. James
From: dagmargoodboat on 17 May 2010 16:53 On May 17, 3:41 pm, "keith...(a)gmail.com" <keith...(a)gmail.com> wrote: > On May 17, 3:07 pm, dagmargoodb...(a)yahoo.com wrote: > > > > > On May 16, 11:48 pm, "k...(a)att.bizzzzzzzzzzzz" > > > <k...(a)att.bizzzzzzzzzzzz> wrote: > > > On Sun, 16 May 2010 21:29:11 -0700 (PDT), dagmargoodb...(a)yahoo.com wrote: > > > >On May 15, 12:18 am, "k...(a)att.bizzzzzzzzzzzz" > > > ><k...(a)att.bizzzzzzzzzzzz> wrote: > > > >> On Fri, 14 May 2010 21:26:28 -0700, John Larkin > > > > >> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > > > >> >On Fri, 14 May 2010 22:55:23 -0500, "k...(a)att.bizzzzzzzzzzzz" > > > >> ><k...(a)att.bizzzzzzzzzzzz> wrote: > > > > >> >>On Fri, 14 May 2010 10:08:36 -0700, John Larkin > > > >> >><jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > > > > >> >>>On Fri, 14 May 2010 09:17:15 -0700, Joerg <inva...(a)invalid.invalid> > > > >> >>>wrote: > > > > >> >>>>John Larkin wrote: > > > >> >>>>> On Fri, 14 May 2010 07:39:56 -0700, Joerg <inva...(a)invalid.invalid> > > > >> >>>>> wrote: > > > > >> >>>>>> John Larkin wrote: > > > > >> >>>>[...] > > > > >> >>>>>>> I like the sales tax, as opposed to income tax, because it puts > > > >> >>>>>>> business on a better basis against imports, so saves jobs. And because > > > >> >>>>>>> it would be enormously simpler and cheaper to comply with. No > > > >> >>>>>>> accountants, no tax returns, no exemptions, no deductions, no > > > >> >>>>>>> quarterly estimates, no loopholes... almost. > > > > >> >>>>>>> Tax consumption. Don't tax savings or investment or job creation. If a > > > >> >>>>>>> person is rich but doesn't spend any money, nobody can reasonably be > > > >> >>>>>>> jealous of his wealth. > > > > >> >>>>>> A serious problem with that: It punishes frugal people who have saved > > > >> >>>>>> for their retirement and rewards those who squandered everything. The > > > >> >>>>>> money they saved _has_ already been taxed. > > > > >> >>>>> Simple fix: don't tax income. > > > > >> >>>>Yeah, but how do you deal with income that _has_ already been taxed but > > > >> >>>>not spent yet because people saved it for their retirement? A flat > > > >> >>>>VAT-type tax is the same as confiscating xx% percent of that. Not fair > > > >> >>>>at all. > > > > >> >>>As I suggested, exempt basics, like food, reasonable rent, generic > > > >> >>>medicines. If people can afford a yacht, they can afford to pay sales > > > >> >>>tax on it. > > > > >> >>The point is that that money has already been taxed. It shouldn't matter if > > > >> >>it is used to buy a yacht. Taxing it again is wrong (one reason I don't trust > > > >> >>Roth IRAs). > > > > >> >As I suggested, eliminate income taxes and go to sales tax. Then > > > >> >things are only taxed once. > > > > >> You're missing the point. Those millions of people who have saved all their > > > >> lives will be taxed a second time. They've *already* been taxed on that > > > >> money. > > > > >The defense the Fair Tax people offer is that it really isn't an > > > >increase at all--you're already paying that 2nd tax today. It's > > > >hidden in the price of everything you buy. > > > > How so? Inflation? That increases investment values, as well. > > > > >The price of anything always includes all the taxes--ihe income, SS, > > > >Medicare, and other taxes--paid by the people who made it. Take those > > > >out and the price of goods will fall. > > > > Sure, but the *INCOME* tax has been paid and the new sales tax will also have > > > to be paid. Without the change, there isn't a second tax on the income. Yes, > > > the "fair" tax will include the income tax of the people paying now, but it > > > will also increase the real cost of the product the same as another income tax > > > would on the buyer. > > > Now you're not getting it...maybe equations would be clearer... I'll > > set out the reasoning, then you can have a go at rebutting it. > > > a) If you buy an item today--any item--the price of that item is > > roughly > > > price = raw materials > > + labor cost(wages + benefits + employer matching taxes) > > + overhead(rent, power, office help, advertising, phones) > > + business taxes > > + profit. > > > b) The Fair Tax economists calculate that when you buy a $1 item, 23 > > cents of the price of that item goes to covering the various taxes > > that the people who made the item had to pay. > > > That is, if your laborer has to pay income tax, you have to pay him > > more to compensate, and you have to raise your sales prices to recover > > that loss from your customers. > > > c) So, when you buy an item, you *are* paying all the taxes of all the > > people and entities that made the item. > > > Make sense so far? > > > d) Under the Fair Tax, with all those embedded taxes eliminated, the > > manufacturer would now be able to make the same profit selling his $1 > > item for $0.77, which would be the new price. > > > e) At checkout, your (formerly) $1 item would now appear on the sales > > ticket as > > 1) price = $0.77, plus > > 2) $0.23 in Fair Tax, collected at point-of-sale to pay all the > > taxes of all the people who made the thing. > > > Total = $1.00, just like before. No difference. > > > There, I think that's basically their pitch. I'm not a Fair Tax > > expert, so I could've biffed something. > > > > >The Fair Tax--now separated and out in the open for all to see--is > > > >simply the tax which you would've paid before anyhow, but without > > > >knowing it. > > > > No, it's not. Yo can't tell me that money that has already been taxed has the > > > same value as money that hasn't. Which would you rather have, $1M in an > > > conventional IRA (no tax yet paid), or $600K ($1M after tax) in a Roth, when > > > they change the tax to a consumption tax? > > > Depends on the tax rates. Under the Fair Tax's 23% I'd rather have > > the $1M, because that way I avoid the current system's higher rates. > > That's the whole point. Anyone with after-tax savings gets screwed > the second time. > > > But, the difference here is not made by getting taxed twice--per item > > c) you are *already* paying the 23% tax built into the price of of an > > purchase, and under today's system you *are* going to pay it when you > > buy something. > > Again, you're missing the point. With after-tax savings you're > *already* paying that tax. If the "Fair Tax" is implemented you get > to pay the "consumption tax" on the *AFTER-TAX* money. I'm not missing the point, I just think you're mathematically wrong. If the thing costs $1 today, or $0.77 plus $0.23 Fair Tax tomorrow, what have you lost? Where have I gone wrong? -- Cheers, James Arthur
From: keithw86 on 17 May 2010 17:05 On May 17, 3:53 pm, dagmargoodb...(a)yahoo.com wrote: > On May 17, 3:41 pm, "keith...(a)gmail.com" <keith...(a)gmail.com> wrote: > > > > > On May 17, 3:07 pm, dagmargoodb...(a)yahoo.com wrote: > > > > On May 16, 11:48 pm, "k...(a)att.bizzzzzzzzzzzz" > > > > <k...(a)att.bizzzzzzzzzzzz> wrote: > > > > On Sun, 16 May 2010 21:29:11 -0700 (PDT), dagmargoodb...(a)yahoo.com wrote: > > > > >On May 15, 12:18 am, "k...(a)att.bizzzzzzzzzzzz" > > > > ><k...(a)att.bizzzzzzzzzzzz> wrote: > > > > >> On Fri, 14 May 2010 21:26:28 -0700, John Larkin > > > > > >> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > > > > >> >On Fri, 14 May 2010 22:55:23 -0500, "k...(a)att.bizzzzzzzzzzzz" > > > > >> ><k...(a)att.bizzzzzzzzzzzz> wrote: > > > > > >> >>On Fri, 14 May 2010 10:08:36 -0700, John Larkin > > > > >> >><jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > > > > > >> >>>On Fri, 14 May 2010 09:17:15 -0700, Joerg <inva...(a)invalid.invalid> > > > > >> >>>wrote: > > > > > >> >>>>John Larkin wrote: > > > > >> >>>>> On Fri, 14 May 2010 07:39:56 -0700, Joerg <inva...(a)invalid..invalid> > > > > >> >>>>> wrote: > > > > > >> >>>>>> John Larkin wrote: > > > > > >> >>>>[...] > > > > > >> >>>>>>> I like the sales tax, as opposed to income tax, because it puts > > > > >> >>>>>>> business on a better basis against imports, so saves jobs. And because > > > > >> >>>>>>> it would be enormously simpler and cheaper to comply with. No > > > > >> >>>>>>> accountants, no tax returns, no exemptions, no deductions, no > > > > >> >>>>>>> quarterly estimates, no loopholes... almost. > > > > > >> >>>>>>> Tax consumption. Don't tax savings or investment or job creation. If a > > > > >> >>>>>>> person is rich but doesn't spend any money, nobody can reasonably be > > > > >> >>>>>>> jealous of his wealth. > > > > > >> >>>>>> A serious problem with that: It punishes frugal people who have saved > > > > >> >>>>>> for their retirement and rewards those who squandered everything. The > > > > >> >>>>>> money they saved _has_ already been taxed. > > > > > >> >>>>> Simple fix: don't tax income. > > > > > >> >>>>Yeah, but how do you deal with income that _has_ already been taxed but > > > > >> >>>>not spent yet because people saved it for their retirement? A flat > > > > >> >>>>VAT-type tax is the same as confiscating xx% percent of that.. Not fair > > > > >> >>>>at all. > > > > > >> >>>As I suggested, exempt basics, like food, reasonable rent, generic > > > > >> >>>medicines. If people can afford a yacht, they can afford to pay sales > > > > >> >>>tax on it. > > > > > >> >>The point is that that money has already been taxed. It shouldn't matter if > > > > >> >>it is used to buy a yacht. Taxing it again is wrong (one reason I don't trust > > > > >> >>Roth IRAs). > > > > > >> >As I suggested, eliminate income taxes and go to sales tax. Then > > > > >> >things are only taxed once. > > > > > >> You're missing the point. Those millions of people who have saved all their > > > > >> lives will be taxed a second time. They've *already* been taxed on that > > > > >> money. > > > > > >The defense the Fair Tax people offer is that it really isn't an > > > > >increase at all--you're already paying that 2nd tax today. It's > > > > >hidden in the price of everything you buy. > > > > > How so? Inflation? That increases investment values, as well. > > > > > >The price of anything always includes all the taxes--ihe income, SS, > > > > >Medicare, and other taxes--paid by the people who made it. Take those > > > > >out and the price of goods will fall. > > > > > Sure, but the *INCOME* tax has been paid and the new sales tax will also have > > > > to be paid. Without the change, there isn't a second tax on the income. Yes, > > > > the "fair" tax will include the income tax of the people paying now, but it > > > > will also increase the real cost of the product the same as another income tax > > > > would on the buyer. > > > > Now you're not getting it...maybe equations would be clearer... I'll > > > set out the reasoning, then you can have a go at rebutting it. > > > > a) If you buy an item today--any item--the price of that item is > > > roughly > > > > price = raw materials > > > + labor cost(wages + benefits + employer matching taxes) > > > + overhead(rent, power, office help, advertising, phones) > > > + business taxes > > > + profit. > > > > b) The Fair Tax economists calculate that when you buy a $1 item, 23 > > > cents of the price of that item goes to covering the various taxes > > > that the people who made the item had to pay. > > > > That is, if your laborer has to pay income tax, you have to pay him > > > more to compensate, and you have to raise your sales prices to recover > > > that loss from your customers. > > > > c) So, when you buy an item, you *are* paying all the taxes of all the > > > people and entities that made the item. > > > > Make sense so far? > > > > d) Under the Fair Tax, with all those embedded taxes eliminated, the > > > manufacturer would now be able to make the same profit selling his $1 > > > item for $0.77, which would be the new price. > > > > e) At checkout, your (formerly) $1 item would now appear on the sales > > > ticket as > > > 1) price = $0.77, plus > > > 2) $0.23 in Fair Tax, collected at point-of-sale to pay all the > > > taxes of all the people who made the thing. > > > > Total = $1.00, just like before. No difference. > > > > There, I think that's basically their pitch. I'm not a Fair Tax > > > expert, so I could've biffed something. > > > > > >The Fair Tax--now separated and out in the open for all to see--is > > > > >simply the tax which you would've paid before anyhow, but without > > > > >knowing it. > > > > > No, it's not. Yo can't tell me that money that has already been taxed has the > > > > same value as money that hasn't. Which would you rather have, $1M in an > > > > conventional IRA (no tax yet paid), or $600K ($1M after tax) in a Roth, when > > > > they change the tax to a consumption tax? > > > > Depends on the tax rates. Under the Fair Tax's 23% I'd rather have > > > the $1M, because that way I avoid the current system's higher rates. > > > That's the whole point. Anyone with after-tax savings gets screwed > > the second time. > > > > But, the difference here is not made by getting taxed twice--per item > > > c) you are *already* paying the 23% tax built into the price of of an > > > purchase, and under today's system you *are* going to pay it when you > > > buy something. > > > Again, you're missing the point. With after-tax savings you're > > *already* paying that tax. If the "Fair Tax" is implemented you get > > to pay the "consumption tax" on the *AFTER-TAX* money. > > I'm not missing the point, I just think you're mathematically wrong. > If the thing costs $1 today, or $0.77 plus $0.23 Fair Tax tomorrow, > what have you lost? Where have I gone wrong? Because it cost me $1.40 yesterday (when I earned it) to have the $1.00 today, and tomorrow (after I retire, take it out of the bank, and spend it) it only buys $.77 worth of stuff. If I tax-deferred the $1.40, I could buy $1.00 worth of stuff. Any after-tax savings (that is socked away before the change) gets hammered *twice*.
From: dagmargoodboat on 17 May 2010 17:31
On May 17, 4:05 pm, "keith...(a)gmail.com" <keith...(a)gmail.com> wrote: > On May 17, 3:53 pm, dagmargoodb...(a)yahoo.com wrote: > > > > > On May 17, 3:41 pm, "keith...(a)gmail.com" <keith...(a)gmail.com> wrote: > > > > On May 17, 3:07 pm, dagmargoodb...(a)yahoo.com wrote: > > > > > On May 16, 11:48 pm, "k...(a)att.bizzzzzzzzzzzz" > > > > > <k...(a)att.bizzzzzzzzzzzz> wrote: > > > > > On Sun, 16 May 2010 21:29:11 -0700 (PDT), dagmargoodb...(a)yahoo.com wrote: > > > > > >On May 15, 12:18 am, "k...(a)att.bizzzzzzzzzzzz" > > > > > ><k...(a)att.bizzzzzzzzzzzz> wrote: > > > > > >> On Fri, 14 May 2010 21:26:28 -0700, John Larkin > > > > > > >> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > > > > > >> >On Fri, 14 May 2010 22:55:23 -0500, "k...(a)att.bizzzzzzzzzzzz" > > > > > >> ><k...(a)att.bizzzzzzzzzzzz> wrote: > > > > > > >> >>On Fri, 14 May 2010 10:08:36 -0700, John Larkin > > > > > >> >><jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > > > > > > >> >>>On Fri, 14 May 2010 09:17:15 -0700, Joerg <inva...(a)invalid.invalid> > > > > > >> >>>wrote: > > > > > > >> >>>>John Larkin wrote: > > > > > >> >>>>> On Fri, 14 May 2010 07:39:56 -0700, Joerg <inva...(a)invalid.invalid> > > > > > >> >>>>> wrote: > > > > > > >> >>>>>> John Larkin wrote: > > > > > > >> >>>>[...] > > > > > > >> >>>>>>> I like the sales tax, as opposed to income tax, because it puts > > > > > >> >>>>>>> business on a better basis against imports, so saves jobs. And because > > > > > >> >>>>>>> it would be enormously simpler and cheaper to comply with. No > > > > > >> >>>>>>> accountants, no tax returns, no exemptions, no deductions, no > > > > > >> >>>>>>> quarterly estimates, no loopholes... almost. > > > > > > >> >>>>>>> Tax consumption. Don't tax savings or investment or job creation. If a > > > > > >> >>>>>>> person is rich but doesn't spend any money, nobody can reasonably be > > > > > >> >>>>>>> jealous of his wealth. > > > > > > >> >>>>>> A serious problem with that: It punishes frugal people who have saved > > > > > >> >>>>>> for their retirement and rewards those who squandered everything. The > > > > > >> >>>>>> money they saved _has_ already been taxed. > > > > > > >> >>>>> Simple fix: don't tax income. > > > > > > >> >>>>Yeah, but how do you deal with income that _has_ already been taxed but > > > > > >> >>>>not spent yet because people saved it for their retirement? A flat > > > > > >> >>>>VAT-type tax is the same as confiscating xx% percent of that. Not fair > > > > > >> >>>>at all. > > > > > > >> >>>As I suggested, exempt basics, like food, reasonable rent, generic > > > > > >> >>>medicines. If people can afford a yacht, they can afford to pay sales > > > > > >> >>>tax on it. > > > > > > >> >>The point is that that money has already been taxed. It shouldn't matter if > > > > > >> >>it is used to buy a yacht. Taxing it again is wrong (one reason I don't trust > > > > > >> >>Roth IRAs). > > > > > > >> >As I suggested, eliminate income taxes and go to sales tax. Then > > > > > >> >things are only taxed once. > > > > > > >> You're missing the point. Those millions of people who have saved all their > > > > > >> lives will be taxed a second time. They've *already* been taxed on that > > > > > >> money. > > > > > > >The defense the Fair Tax people offer is that it really isn't an > > > > > >increase at all--you're already paying that 2nd tax today. It's > > > > > >hidden in the price of everything you buy. > > > > > > How so? Inflation? That increases investment values, as well. > > > > > > >The price of anything always includes all the taxes--ihe income, SS, > > > > > >Medicare, and other taxes--paid by the people who made it. Take those > > > > > >out and the price of goods will fall. > > > > > > Sure, but the *INCOME* tax has been paid and the new sales tax will also have > > > > > to be paid. Without the change, there isn't a second tax on the income. Yes, > > > > > the "fair" tax will include the income tax of the people paying now, but it > > > > > will also increase the real cost of the product the same as another income tax > > > > > would on the buyer. > > > > > Now you're not getting it...maybe equations would be clearer... I'll > > > > set out the reasoning, then you can have a go at rebutting it. > > > > > a) If you buy an item today--any item--the price of that item is > > > > roughly > > > > > price = raw materials > > > > + labor cost(wages + benefits + employer matching taxes) > > > > + overhead(rent, power, office help, advertising, phones) > > > > + business taxes > > > > + profit. > > > > > b) The Fair Tax economists calculate that when you buy a $1 item, 23 > > > > cents of the price of that item goes to covering the various taxes > > > > that the people who made the item had to pay. > > > > > That is, if your laborer has to pay income tax, you have to pay him > > > > more to compensate, and you have to raise your sales prices to recover > > > > that loss from your customers. > > > > > c) So, when you buy an item, you *are* paying all the taxes of all the > > > > people and entities that made the item. > > > > > Make sense so far? > > > > > d) Under the Fair Tax, with all those embedded taxes eliminated, the > > > > manufacturer would now be able to make the same profit selling his $1 > > > > item for $0.77, which would be the new price. > > > > > e) At checkout, your (formerly) $1 item would now appear on the sales > > > > ticket as > > > > 1) price = $0.77, plus > > > > 2) $0.23 in Fair Tax, collected at point-of-sale to pay all the > > > > taxes of all the people who made the thing. > > > > > Total = $1.00, just like before. No difference. > > > > > There, I think that's basically their pitch. I'm not a Fair Tax > > > > expert, so I could've biffed something. > > > > > > >The Fair Tax--now separated and out in the open for all to see--is > > > > > >simply the tax which you would've paid before anyhow, but without > > > > > >knowing it. > > > > > > No, it's not. Yo can't tell me that money that has already been taxed has the > > > > > same value as money that hasn't. Which would you rather have, $1M in an > > > > > conventional IRA (no tax yet paid), or $600K ($1M after tax) in a Roth, when > > > > > they change the tax to a consumption tax? > > > > > Depends on the tax rates. Under the Fair Tax's 23% I'd rather have > > > > the $1M, because that way I avoid the current system's higher rates.. > > > > That's the whole point. Anyone with after-tax savings gets screwed > > > the second time. > > > > > But, the difference here is not made by getting taxed twice--per item > > > > c) you are *already* paying the 23% tax built into the price of of an > > > > purchase, and under today's system you *are* going to pay it when you > > > > buy something. > > > > Again, you're missing the point. With after-tax savings you're > > > *already* paying that tax. If the "Fair Tax" is implemented you get > > > to pay the "consumption tax" on the *AFTER-TAX* money. > > > I'm not missing the point, I just think you're mathematically wrong. > > If the thing costs $1 today, or $0.77 plus $0.23 Fair Tax tomorrow, > > what have you lost? Where have I gone wrong? > > Because it cost me $1.40 yesterday (when I earned it) to have the > $1.00 today, If you paid taxes already under the old system then you were screwed *yesterday*. That can't be fixed-it's gone. Sorry. Me too. > and tomorrow (after I retire, take it out of the bank, > and spend it) it only buys $.77 worth of stuff. $1 only buys $0.77 worth of _stuff_ today, say the Fair Tax people (AIUI). The rest goes to taxes hidden in the item's price. > If I tax-deferred the > $1.40, I could buy $1.00 worth of stuff. Any after-tax savings (that > is socked away before the change) gets hammered *twice*. If you had tax-deferred the $1.40, you'd escape the indignities of the old system. That's a windfall (assuming Congress allows it). Going forward though, with income-taxed money, the $1 we have left still buys the same with or without the Fair Tax. $1 with embedded tax burden hidden inside it, or ($0.77 actual price + $0.23 Fair Tax) both cost you $1 at the register. No loss of purchasing power. That's the contention, AIUI. -- Cheers, James Arthur |