Opinion

Why I Support A Fair Tax

Why I support a Fair Tax
By Rick Steeby

 
First I have to admit I am not a tax policy expert, I am not an economist with a degree in the field and I could not begin to calculate what the tax rate would have to be to meet the needs of the government essential services or my view point on what essential even means.
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Fair means equitable for all and I know right up front that I will get the why isn’t it the duty in all fairness that the rich and huge corporations pay the bulk of the taxes and I can tell you that the rich and corporations only pay taxes on what they buy and some “rich” individuals pay some on earned income but most pay far less taxes on their total income than those listed by the government as below the poverty level.
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So how is it that someone who receives a check from the government as a tax refund and was exempt from income tax paying a higher rate than say Al Gore or George W. Bush?  There is the obvious which is that each of them that had a job an paid in for Social Security and Medicare but that isn’t where they paid the most in taxes.

In 2008 Wal-Mart paid 7 Billion Dollars in corporate taxes. Did the corporation divide up the profits at the end of year then everyone divvy up their money and pay the taxes?  No.  As a matter of fact, the guy greeting you at the door paid more in taxes then did Wal-Mart. If he shopped there then he helped pay their taxes because Wal-Mart just collects taxes for the government plus enough to pay the over head to do the accounting and corporation filing fees court costs…and any other associated costs from the sale of goods and services. Wal-Mart took it from their customers collected it for the government and wrote the check in their name. Better yet they collected a little more to pay for the cost of collecting it too.  Good chance it set in an interest bearing account that they made a little profit on before sending it to the IRS.

Wal-Mart and all other corporations that are in business and successfully post a profit do so after all the associated costs of being in business is figured down to the penny for each and every item sold, returned , damaged or donated at the time it is sold, returned or donated. That means if you shop at Wal-Mart you are paying their corporate income tax, their Payroll tax, their health plan, their business license, their incorporation fees, property taxes and on and on.

If you haven’t figured it out yet the government has a value added sales tax on every item you buy but they have Wal-Mart, Exxon, Sears, Taco Bell, Coke, GM and every other retailer in this country collect it. Hey it’s a great plan because it works for both the corporations and the government.

The government thinks that if ordinary Americans (Ordinary in the halls of congress means stupid) and illegal aliens knew how much they really paid for taxes they might surround the Capital and threaten to throw them all out, wait that is already happening. Guess they would really be mad if they knew the truth.

I don’t know the exact number but it is not truly material to this discussion but all of you who thought you were paying no taxes actually spent more than half of your income on taxes and the rest went to pay for what you needed to live and for that the government ran the economy into the ground and are still accelerating down ward.

How is that possible? I want you to think of something that is very efficient. Did anyone come up with government? No, well there may be hope. Actually for the government to collect the taxes they spend around half what is collected. Since the government doesn’t want you to think about how much money they waste each and every day they first have to convince you that the money they are wasting wasn’t your money. It was the money they took from the rich. Almost no one thinks they are rich so if the rich are paying for it then it is someone else.

Neat trick the government uses to make you think the rich are paying the bill is that they publish stats each year that say things like the top 10% of income earners paid 65 to 70% of all the taxes. Two problems with that:

1. They forgot the taxes on your cell phone, your home phone, on gas, airline tickets, social security, Medicare and the list goes on.
2. Guess what; Wal-Mart, Microsoft, Dell, BP and every company with INC. LLC. or any other form of incorporation is considered a rich person.

Now you know that there are all kinds of taxes that the government collects from you that they don’t include in the figures above and if they actually collected those taxes from the rich they, the rich, would move their homes and their companies elsewhere. All those fees add up and again unless you look at the invoice closely you do not realize you paid those fees to the government by way of the corporation.
Since we know that all those corporations don’t really pay the taxes you do then that means that the 60 to 70% you thought the rich was paying is more like the 10% actual people are actually paying. (Except rich people buy more stuff just not at Wal-Mart so they still pay just that they have better lawyers and CPAs so the percentage taken out of actual earned income is often times, well zero)

Let us say that for sake of example that you got a tax refund, and traded in your old clunker in a “cash for clunkers” deal. Between your savings and 2000 dollars the government gave you that cost the government 5000 dollars to give you then you have enough for half the cost of a new Honda Civic.  You sat down with the sales person who told you that the cost of the car was exactly the amount you had but you would be taking out an 8000 dollar loan to pay the taxes on that car for Honda. Would you get up from the table and tell them to stick it?

Did you know there are government regulations prohibiting companies from itemizing on your receipt exactly what part of the sales amount is going to pay for the taxes? In every gallon of gas you buy the company makes about 3-5% profit and the government collects 5 to ten times as much. The rest is to pay for the shipping, refining and a little for the gas station owner.

I think it should be fair to say that you should be able to see that regardless of what you have been told that you, the 300,000,000 individuals who live inside the boarders of the USA, pay all the taxes collected. It is not that since we receive the benefits and services the government provides that it isn’t fair. What isn’t fair is lying about it by saying that rich people pay the taxes.

A fair Tax is one where you pay the tax and know what you’re paying.

• Do away with corporate taxes because in the end we still pay it and we get charged extra for the corporation to make sure we don’t over pay and they still make a profit.
• Do away with Social Security, Medicare, unemployment and payroll taxes because without those taxes and the corporate taxes we don’t need the IRS and H and R Block and that would save the government Billions and that means less taxes for us
• Since we determined that the taxes are for the most part collect at the sale of an item set a % of sale based on a percentage of the GNP and that amount is all the taxes the government can collect in a given year.
• If the GNP goes up then more revenue comes in if it goes down revenue goes down and the government has a stake in making sure we have a strong and vibrant economy
• If you and all your face book friends decide that you don’t like the government spending money on war then you can quit buying anything or at least reduce your spending to a minimum and if you have enough friends then you can influence the government not to do what you don’t like.
• Wal-Mart has no reason to lobby congress because congress cannot tax them more or less than their competition and since the congress is not under the impression that Wal-Mart is paying the bills there is no reason to regulate Wal-Mart differently than any other company because they aren’t in appearance paying the taxes.
• The last item in a fair tax would be that corporations cannot be treated as people and should not influence government and since government cannot treat them differently one from another they have no stake in the outcome of elections except for the purposes of graft. They cannot to be fair to the tax payers support any campaign through the use of corporate funds.
• Since corporations contribute greatly to the GNP and therefore the amount of tax money generated to fund government in a fair tax world they would not be without some influence and because it would be a huge benefit to corporations to not have corporate income tax to collect for the government the government would not be without influence on corporation who wish to do business in the USA

I am not a scholar on the Fair Tax as purposed by the Authors of that book or their organization but I feel that the ideas I have presented here are not so far from theirs and so I support what they propose.

A Fair Tax is one that you know you are paying.

A fair Tax is one you know exactly how much you are paying.

A Fair Tax is applied in such a manner that you can choose to limit or not your contribution so that as in the case like the health care bill where 70% of the legal voters were against something they could have an immediate impact on the available funds to run government just by cutting their personal spending.

A Fair Tax doesn’t tax essential services and needs like medical services, basic utilities and food purchased at a market.

A Fair Tax is the same across the board so if I buy a used Chevy the sales tax would be the same % that George Soros pays for his limo.

A Fair Tax will, as a part of its function, tax the wealthiest citizens more in actual dollars because they are the largest consumers of goods and services.

A Fair Tax takes away the government’s ability to give differential treatment to different tax payers. You cannot give Bill Gates a tax break and Hilary Clinton a tax hike in fact they would pay the same rate as everyone else and no CPA or Tax lawyer can keep them from it.

A Fair Tax does not tax savings or defer taxes on savings.

A Fair Tax does tax appreciation at and only at the sale because if you buy a home at 100K and you paid 15K in taxes and the home goes up in value to 200K the taxes at sale would be 30K. Same would be true for any asset and the reverse is true also. If the value goes down the tax goes down.

Again the ideas presented here are mine and only mine. I don’t feel that the current tax code is “Fair” by any stretch of the imagination and in fact is most detrimental to those individuals who believe that the current tax code is to their benefit. It is a fraud perpetrated on the American people by the state and the corporations weather as co-conspirators or as unwilling accomplices to collect taxes at a rate far more detrimental to the average working American than is commonly know. It is a scheme to fleece us without our knowing and using class envy to pull it off by charging the rich/corporations to collect the taxes hidden in the cost of goods and services.

If you want government of the people and by the people then the people must know what their true contribution in taxes are and then that only happens when the taxes appear on the receipt each and every time they buy something.

Do you want to believe that GM pays the taxes and that Wal-Mart paid to bail out GM then leave the system the way it is. If you believe that you are really paying for all that but have no real idea how much you are paying then you believe as I do that we need a Fair Tax Law and now!

 

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