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Old 08-27-2005, 09:35 AM
tread tread is offline
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Join Date: Sep 2004
Posts: 2
Default Re: \"Fair Tax\"-a better alternative than \"Flat Tax\"

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A rich family that wants to live very modestly will pay very little in tax.

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Precisely the problem I am refering to. If the rich have the ability to CHOOSE to pay less in taxes, there can only be one of two possible outcomes.

1) Less revenue will be taken in OR
2) The poor/middle have to pay more in taxes to make up for the shortfall.

Less adminstrative costs are great, and this would be part of the revenue neutrality concept. So if your facts are correct about 250 billion (this was per year?) in administrative cost, a revenue neutral system would only have to take in 250 billion less than it currently does. In essence creating 250 billion dollars in tax breaks over the current system. Again I ask you, where will these breaks manifest themselves? Will the be another Bush-like cut where 53% of the cut goes to the wealthiest 10%?

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There is more to taxes than simply how much you collect, and where it comes from. Different taxation methods have different effects on how people spend money, thus affecting the economy - either in a positive way or a negative way.

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Could you be a little more specific about what your point is here? Are you saying that putting more money back in the hands of poor/middle class improves the economy, or are you advocating "trickle down" economics? All I have to say is there is, in order for there to be a coorelation between tax policy and the strength of the economy, you have to have a noticeable shift one way when you take one action and the exact opposite way when you take the opposite action. There isn't a shred of evidence that supports a coorelation in this case. Economies were very strong during both the Reagan and Clinton presidencies (and ultimately collpased at the end of each) and one lowered taxes and the other raised taxes. Any attempt to link taxation policy to being the determining factor as to whether or not we can have a thriving economy is baseless rhetoric.

You actually answered my post with mostly baseless rhetoric and gave us no facts/projections with which to analyze or judge the system and compare it to the current one. Yes, we all understand it gives some people the option to choose how much they pay in taxes, is this a good thing? Since control is in the hands of the people, how can you project what revenues will be? Especially for future years? Much of legislation in congress deals with deciding on programs, how can you accurately asses that legislation when it is very difficult to predict future budgets? Are you going to use current spending habits to make estimations when they most obviously will change under the new systems? Or has someone figured out a way to estimate this?

Perhaps I am wrong and they have figured out reliable ways to estimate this stuff. If they have, please provide the facts so we can evaluate them. What will the overall revenue taken in be and what classes pay what percentage of the revenue taken in. With everything I have heard so far (upper class "option" to pay less and rebates to the poor) it sounds like a squeeze on the middle class to me, but I will wait to see the facts before making a final judgement.
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