FairTax potential effects on gambling

[bills217]

There's a new best-selling book out discussing a new proposal called the "FairTax." If you pay close attention to the news you may have already heard something about it.

It has a long way to go before it can become law obviously, but in theory, it would completely replace the income tax and all other current taxes, and replace it with a 23% sales tax on all goods and services. The IRS would become a thing of the past, and FairTax supporters (including me) claim it can be done revenue-neutral. (Rather than post basic questions about the FairTax on this thread, just go to www.FairTax.org and read the FAQ.)

No tax considerations whatsoever would be taken directly from gambling income, and since a professional internet gambler ideally has less work-related expenses than the average person (doesn't require an hour-long commute to work, etc.), it seems to me that the FairTax proposal might be VERY favorable for an online poker pro, who makes his living through offshore entities, and thus avoids the increased expenses a B&M player could logically expect to see under the FairTax. Remember, under this proposal the direct tax on income would be abolished entirely.

Let me know your thoughts on this.

[Quercus]

A flat tax will never happen in the US, regardless of how much fiscal sense it might make.

The ability to grant tax favors to friends and overtax enemies is a key power of politicians. They will not give it up under any circumstances.

[bills217]

"A flat tax will never happen in the US, regardless of how much fiscal sense it might make."

It is not a flat tax. Go read the FAQ on the website. All citizens would get a rebate up to poverty-level spending, actually making it more progressive than the current system, although I realize it has nothing to do with your main point about the power of politicians. Congressman John Linder is a co-author of the book and sponsor of the bill, so there's one politician who supports it.

If my understanding is correct, they have something mildly similar in Europe called value-added taxes (VAT's), so I think it's a realistic enough possibility to make it worth discussing, especially considering the apparent advantage it would give online poker pros.

[MicroBob]

I know very little about such things for the most part (I do know there are some top economists who think it would cause some big problems...especially at first).


But I do know that as an online poker player (full-time for income) I would LOVE to see such a tax.
Certainly would help us out in such situations as the IRS running around all over the place trying to figure out who has paid what they are supposed to be paying and who hasn't.

The thought that I would be saving however much money I would save if I were just a citizen of another country really kind of bugs me (even though I know of the advantages of being an American and some of the disadvantages of living elsewhere of course).


There are TONE of people today who aren't really thrilled with the tax-system as it is currently.
The tax-code is impossible to figure out in places. And who in the work-force loves seeing that HUGE chunk of their pay-check getting taken out month after month.


Indeed...my expenses are less due to no commute and other such stuff.



One of the guys who wrote the best-selling book was on the Daily Show the other night.
I guess this means he's probably touring some of the other talk-shows as well (such as the various morning network news-programs and what-not).

[sekrah]

If it were passed, It would be a huge advantage to everybody in the country, not just professional poker players.

If I were allowed to keep my entire paycheck, I'd probably work 80+ hours a week..

Goods would be taxed 23%, but the cost of making goods would fall as corporations would no longer be taxed, they can sell there goods at a lower price, and the net cost of goods would be very small.

But like the last poster said, anything that takes power away from the government (and this does), will probably never pass unless there was an overwhelming movement to get this through.

There are far too many idiots in this country who wouldn't understand the economics and implications behind the system.

[Quercus]

I'm familiar with the proposal. Its a rehash of the flat tax idea meant to make it more palatable. I want to say that Linder was on our local talk radio station one morning talking it up (though it may have just been a supporter.)

The last time a politician tried to push the flat tax on a national scale he was soundly defeated (Steve Forbes).

Its too bad though, our byzantine tax structure is just a nightmare of waste. Far too many smart kids going into the government created fields of tax law and tax accounting and not enough going into something useful outside of dealing with a bad tax code.

Not to mention the huge time burden placed on basically every adult in the US. How many lifetimes worth of manhours are burned for no reason every year just to pay taxes?

Anyway, this is probably starting to delve a little too close to the politics forum...

[MicroBob]

i agree with your ideas of man-hours wasted and smart-people who could be out curing cancer or something instead of making money off of the gross-confusion-waste-of-paper that is the U.S. tax-code.


I disagree about your Steve Forbes implication though.
The guy was soundly defeated not BECAUSE of his tax-plan but because he had zero personality (or....in fact....an almost-negative personality).
If he was able to more intelligently and perhaps charismatically present the tax-code then it could have gotten somewhere.


I cringe to admit this....but if a Republican weren't TOO wacky on the social issues I would seriously consider voting for him if he were to solidly put a flat-tax at the front of his agenda (and have the backers in congress to support it too).


(fwiw - I am more independent than anything but am willing to vote for whichever party...even republican which I typically do not identify with... if I think the candidate actually has a clue)

[Sifmole]

[ QUOTE ]

I disagree about your Steve Forbes implication though.
The guy was soundly defeated not BECAUSE of his tax-plan but because he had zero personality (or....in fact....an almost-negative personality).

[/ QUOTE ]

I am attending a wedding in 3 weeks that will give me a chance to answer a burning question... Is Steve Forbes that utterly boring in real life? I will let you all know.

[MicroBob]

i can answer that question without having to go to the wedding.
the answer is "more so."

although if he gets hammered at the reception you better believe I'm ging out of my way to party with that guy!!!

[bvaughn]

Absolutely, positively in favor of the fair tax. Bleeding heart liberals will cry that it negatively impacts the poor and benefits the rich, but if you listen (or read) the logical arguments for the fair tax you will realize that the poor aren't effected at all and the rich get to keep what they deserve to keep...their hard-earned fair share!