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From: Greegor on 10 Jun 2010 22:28
On Jun 10, 5:50 pm, "k...(a)att.bizzzzzzzzzzzz"
<k...(a)att.bizzzzzzzzzzzz> wrote:
> On Thu, 10 Jun 2010 10:06:20 -0400, Spehro Pefhany
>
> <speffS...(a)interlogDOTyou.knowwhat> wrote:
> >On Wed, 09 Jun 2010 20:37:37 -0500, "k...(a)att.bizzzzzzzzzzzz"
> ><k...(a)att.bizzzzzzzzzzzz> wrote:
>
> >>Of *course*.  The "Fair Tax" is only federal.  It would be UNCONSTITUTIONAL
> >>for the feds to dictate to the states how to raise revenue, or to do it for
> >>them.

SP >Couldn't they voluntarily agree to do so?

krw > IMO, no.  That said, it's done every day.
krw > Think: highway trust fund.  Note the
krw > strings that go with that mess (e.g. seat belt laws).

You're touching on a very interesting twist
having to do with state's rights.

It's not the only area in which the Federal
Government basically BUYS a law from each
state in exchange for massive funding.

A few years back the Feds pushed every
state to lower the Blood Alcohol level
for the legal standard for intoxication to
be so low that a person having a single
glass of wine with a meal at a supper club
could be nailed for Drunk Driving.

When I drove taxi I watched drunks STAGGER
to their cars and saw how unwilling they
were to give up the keys.

I saw a large number of SEVERELY drunk
people drive off. It occurs to me that Police
are now wasting a LOT of time on the
less severe cases and makes the reality
more about selective enforcement than
about addressing the more severe problems.

We have enough areas where laws are
set up to be enforced only when the
authorities have an axe to grind or
isn't related somehow to the "perp".

It's called "selective enforcement".

But the tactic of "buying laws" or "buying states rights"
has become much more common.

At some level it steam rollers over the
individuality of states and weakens
the distinction between states, trending
toward one huge nation state.

From: Joerg on 10 Jun 2010 22:37
dagmargoodboat(a)yahoo.com wrote:
> On Jun 9, 8:37 pm, "k...(a)att.bizzzzzzzzzzzz" <k...(a)att.bizzzzzzzzzzzz>
> wrote:
>> On Wed, 09 Jun 2010 15:40:26 -0700, Joerg <inva...(a)invalid.invalid> wrote:
>
>>> Ah, so property tax remains. State sales tax remains. State income tax
>>> remains. No thanks, then I don't want the "fair tax".
>> Of *course*. The "Fair Tax" is only federal. It would be UNCONSTITUTIONAL
>> for the feds to dictate to the states how to raise revenue, or to do it for
>> them.
>
>
> To sum up the many points in play:
>
> I don't think Joerg's understanding this at all: that the Fair Tax is
> a federal tax that eliminates a huge federal mess.
>

I do understand that :-)


> And, the Constitution simply doesn't allow the federal government to
> set, control, collect, or in any way determine how states collect
> their revenues. That would be unconstitutional. So, the Fair Tax
> can't eliminate state-stuff, that's up to each state.
>
> But, the Fair Tax still simplifies things greatly--it eliminates the
> many federal taxes I've listed repeatedly: personal income tax, Social
> Security tax (6.5%-ish), Medicare tax, unemployment, matching taxes
> paid by the employer[*], the new Obamacare taxes on income and
> insurance, capital gains tax, alternative minimum tax, corporate
> income tax, and more. All replaced with a single tax collected at
> point-of-sale. Citizens would no longer have to file income tax
> returns.
>

That is simply not true. It was discussed here ad nauseam that they will
still have to file their state tax returns as usual. _That_ is what
causes all the effort and compliance costs. It makes no difference
whether you file state or federal or both. One alone will generate
nearly all the compliance works and costs all by itself, the other
simply follows a similar pattern. You have to get all your 1099s in
order, all you interest income, all your deductions. If the states do
not change their system as well then the claim that a "fair tax"
eliminates compliance costs is a big old joke. Because it doesn't.


> [*] So, theoretically, your employer could pay you more.
>
> That's a significant step forward. (A giant leap forward?)
>
> Joerg's concerned about potential double-taxation. I brought that
> concern personally to the actual people, and they're very receptive to
> doing that. Those things happen as amendments to bills as said bills
> get debated and perfected in Congress. (In normal times, anyhow.)
>

And then, pretty soon, we are on our merry way again to a goliath
70,000+ page tax code :-)


> My greatest qualm is the prebate. The idea of everyone getting
> government checks just bugs me--it reeks of nanny-state. John
> suggested exempting necessities; I like that better.
>

That can be risky because it fosters misapproriation. What really blew
my mind was what some French folks did back in the late 70's: They broke
a piece off of a baguette and wiped the table with it. Cheaper ...

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.
From: Joerg on 10 Jun 2010 23:02
Spehro Pefhany wrote:
> On Wed, 09 Jun 2010 16:43:42 -0700, Joerg <invalid(a)invalid.invalid>
> wrote:
>
>> John Larkin wrote:
>>> On Wed, 09 Jun 2010 17:09:49 -0400, Spehro Pefhany
>>> <speffSNIP(a)interlogDOTyou.knowwhat> wrote:
>>>
>>>> On Wed, 09 Jun 2010 14:03:36 -0700, Joerg <invalid(a)invalid.invalid>
>>>> wrote:
>>>>
>>>>
>>>>> That's actually how VAT works in Europe, with one major difference:
>>>>> Businesses get a full refund on the VAT paid on oscilloscopes. Not on
>>>>> beer consumed after hours though :-)
>>>> How about beer consumed during working hours?
>>> We pay sales tax on it, but we expense it too, so it reduces our
>>> corporate income tax, which is (in a good year) a lot higher than
>>> sales tax.
>>>
>> Yes, but: If you can expense 100% of the VAT, sales tax, whatever, then
>> that is a much better deal than expensing it. Because your corporate tax
>> rate isn't 100% even if you had the sales volume of Exxon.
>
> The VAT (which is credited, not expensed) is only a percentage of the
> cost.
>

Sorry, the first incidence of expense should have read claim (as in file
for refund).


> There are four possibilities (ignoring the partial deductiblity and
> assigning taxable benefit to the employee options, which governments
> won't necessarily do)
>
> 00 Pay sales tax, expense not deductible (counts as income for
> the company).
> 01 Pay sales tax, write off total cost as business expense
> 10 Get sales tax rebated, expense counts as income for company
> 11 Get sales tax rebated, write off remainder as business expense
>
> In case 0x01, if the corporate income tax rate is less than the
> sales tax rate you're better off than you would be with case 0x10.
> But the best case (for beer consumers) would be 0x11.
>

0x11 is how it works in Europe when companies buy something. Technically
the refunded amount of VAT counts as income but it's a wash because paid
VAT counts as expense. So they cancel. I've never understood the logic
behind that last part, maybe to increase the sales of toner and ink
cartriges.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.
From: dagmargoodboat on 11 Jun 2010 01:45
On Jun 10, 9:37 pm, Joerg <inva...(a)invalid.invalid> wrote:
> dagmargoodb...(a)yahoo.com wrote:
> > On Jun 9, 8:37 pm, "k...(a)att.bizzzzzzzzzzzz" <k...(a)att.bizzzzzzzzzzzz>
> > wrote:
> >> On Wed, 09 Jun 2010 15:40:26 -0700, Joerg <inva...(a)invalid.invalid> wrote:
>
> >>> Ah, so property tax remains. State sales tax remains. State income tax
> >>> remains. No thanks, then I don't want the "fair tax".
> >> Of *course*.  The "Fair Tax" is only federal.  It would be UNCONSTITUTIONAL
> >> for the feds to dictate to the states how to raise revenue, or to do it for
> >> them.
>
> > To sum up the many points in play:
>
> > I don't think Joerg's understanding this at all: that the Fair Tax is
> > a federal tax that eliminates a huge federal mess.
>
> I do understand that :-)
>
> > And, the Constitution simply doesn't allow the federal government to
> > set, control, collect, or in any way determine how states collect
> > their revenues.  That would be unconstitutional.  So, the Fair Tax
> > can't eliminate state-stuff, that's up to each state.
>
> > But, the Fair Tax still simplifies things greatly--it eliminates the
> > many federal taxes I've listed repeatedly: personal income tax, Social
> > Security tax (6.5%-ish), Medicare tax, unemployment, matching taxes
> > paid by the employer[*], the new Obamacare taxes on income and
> > insurance, capital gains tax, alternative minimum tax, corporate
> > income tax, and more.  All replaced with a single tax collected at
> > point-of-sale.  Citizens would no longer have to file income tax
> > returns.
>
> That is simply not true. It was discussed here ad nauseam that they will
> still have to file their state tax returns as usual.

Obviously, but that's STATE. Federal goes away.

> _That_ is what
> causes all the effort and compliance costs. It makes no difference
> whether you file state or federal or both. One alone will generate
> nearly all the compliance works and costs all by itself, the other
> simply follows a similar pattern.

I beg to differ. States don't charge Social Security tax, Medicare
Tax, etc. States usually have simpler rules too for things like
capital gains.

> You have to get all your 1099s in
> order, all you interest income, all your deductions.

If your state requires those, I guess so. Mine doesn't.

> If the states do
> not change their system as well then the claim that a "fair tax"
> eliminates compliance costs is a big old joke. Because it doesn't.
>
> > [*] So, theoretically, your employer could pay you more.
>
> > That's a significant step forward.  (A giant leap forward?)
>
> > Joerg's concerned about potential double-taxation.  I brought that
> > concern personally to the actual people, and they're very receptive to
> > doing that.  Those things happen as amendments to bills as said bills
> > get debated and perfected in Congress. (In normal times, anyhow.)
>
> And then, pretty soon, we are on our merry way again to a goliath
> 70,000+ page tax code :-)

Oh please. We've got 76,000 pages now. Would it really kill the deal
if it took two measly extra pages in the (very modest, easy-to-
understand) Fair Tax bill to exclude Roth IRAs?


> > My greatest qualm is the prebate.  The idea of everyone getting
> > government checks just bugs me--it reeks of nanny-state.  John
> > suggested exempting necessities; I like that better.
>
> That can be risky because it fosters misapproriation. What really blew
> my mind was what some French folks did back in the late 70's: They broke
> a piece off of a baguette and wiped the table with it. Cheaper ...

Taxation fosters misappropriation. That's just about our whole
problem--giving the trust fund to the teenagers. And look what
they've done with it...

--
Cheers,
James Arthur
From: Joerg on 11 Jun 2010 11:43
dagmargoodboat(a)yahoo.com wrote:
> On Jun 10, 9:37 pm, Joerg <inva...(a)invalid.invalid> wrote:
>> dagmargoodb...(a)yahoo.com wrote:
>>> On Jun 9, 8:37 pm, "k...(a)att.bizzzzzzzzzzzz" <k...(a)att.bizzzzzzzzzzzz>
>>> wrote:
>>>> On Wed, 09 Jun 2010 15:40:26 -0700, Joerg <inva...(a)invalid.invalid> wrote:
>>>>> Ah, so property tax remains. State sales tax remains. State income tax
>>>>> remains. No thanks, then I don't want the "fair tax".
>>>> Of *course*. The "Fair Tax" is only federal. It would be UNCONSTITUTIONAL
>>>> for the feds to dictate to the states how to raise revenue, or to do it for
>>>> them.
>>> To sum up the many points in play:
>>> I don't think Joerg's understanding this at all: that the Fair Tax is
>>> a federal tax that eliminates a huge federal mess.
>> I do understand that :-)
>>
>>> And, the Constitution simply doesn't allow the federal government to
>>> set, control, collect, or in any way determine how states collect
>>> their revenues. That would be unconstitutional. So, the Fair Tax
>>> can't eliminate state-stuff, that's up to each state.
>>> But, the Fair Tax still simplifies things greatly--it eliminates the
>>> many federal taxes I've listed repeatedly: personal income tax, Social
>>> Security tax (6.5%-ish), Medicare tax, unemployment, matching taxes
>>> paid by the employer[*], the new Obamacare taxes on income and
>>> insurance, capital gains tax, alternative minimum tax, corporate
>>> income tax, and more. All replaced with a single tax collected at
>>> point-of-sale. Citizens would no longer have to file income tax
>>> returns.
>> That is simply not true. It was discussed here ad nauseam that they will
>> still have to file their state tax returns as usual.
>
> Obviously, but that's STATE. Federal goes away.
>

So? What's the tangible benefit for Joe Q.Public in terms of compliance
effort and cost? Next to nothing ...


>> _That_ is what
>> causes all the effort and compliance costs. It makes no difference
>> whether you file state or federal or both. One alone will generate
>> nearly all the compliance works and costs all by itself, the other
>> simply follows a similar pattern.
>
> I beg to differ. States don't charge Social Security tax, Medicare
> Tax, etc. States usually have simpler rules too for things like
> capital gains.
>

Social, medicare and all that are one-liners. The effort in doing a tax
return is all the other stuff and the rules aren't much simpler there,
at least not in California. Sorry, but I don not buy the compliance cost
reduction. Not at all, unless the states change as well but that'll be
up to them.


>> You have to get all your 1099s in
>> order, all you interest income, all your deductions.
>
> If your state requires those, I guess so. Mine doesn't.
>

Mine does. There's a reason that my clients send me the 1099s in
triplicate :-)


>> If the states do
>> not change their system as well then the claim that a "fair tax"
>> eliminates compliance costs is a big old joke. Because it doesn't.
>>
>>> [*] So, theoretically, your employer could pay you more.
>>> That's a significant step forward. (A giant leap forward?)
>>> Joerg's concerned about potential double-taxation. I brought that
>>> concern personally to the actual people, and they're very receptive to
>>> doing that. Those things happen as amendments to bills as said bills
>>> get debated and perfected in Congress. (In normal times, anyhow.)
>> And then, pretty soon, we are on our merry way again to a goliath
>> 70,000+ page tax code :-)
>
> Oh please. We've got 76,000 pages now. Would it really kill the deal
> if it took two measly extra pages in the (very modest, easy-to-
> understand) Fair Tax bill to exclude Roth IRAs?
>

As I said, many older people have savings and investments other than
Roth. They do not wish those to be taxed again. How will all that be
handled?

>
>>> My greatest qualm is the prebate. The idea of everyone getting
>>> government checks just bugs me--it reeks of nanny-state. John
>>> suggested exempting necessities; I like that better.
>> That can be risky because it fosters misapproriation. What really blew
>> my mind was what some French folks did back in the late 70's: They broke
>> a piece off of a baguette and wiped the table with it. Cheaper ...
>
> Taxation fosters misappropriation. That's just about our whole
> problem--giving the trust fund to the teenagers. And look what
> they've done with it...
>

Yup :-(

And an increased consumption-based tax fosters an increase in
underground economy. Big time.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.
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