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If, as I understand it, personal income tax revenues are about 8.5% of GDP, would it be reasonable to replace that revenue stream and payment system with a federal sales tax of 10%?With tax time coming up, eliminating the IRS seems like a great idea. This idea was proposed by Mike Huckabee in last year's election, and was known as the Fair Tax. The Beacon Hill Institute calculated that the Fair Tax would collect $2.6 trillion in revenue and boost GDP of 7.9% in the first year. On the other hand, The Brookings Institute calculated that the Fair Tax rate of 23% would make taxes rise for 90% of all households.
A change on such a grand scale would need to be further researched, and the results shared openly so the work can be checked. The plan should be test marketed in a small area, then implemented gradually so the shift from income tax to sales tax could be made over time. In any event, such a change should not be implemented until the economy has recovered more fully.
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Brookings need to look at my paycheck after taxes. If you add up all of the taxes I pay and I mean all (not just income tax)!! It comes to around 62% of my income. So how does Brookings get a way with saying that a “Fair Tax” of 23-30% would raise my taxes? The “Fair Tax” also doesn’t tax on needed items. Once again a classic example of how the elite changes the facts to keep stickin it to the middle class.
With reasonably taxing a FairTax-GDP practically on anabolic steroids from increased work hours (20% estimated), no income tax/bigger paychecks, and the prebate, which go back into the GDP anyway, the “poor” can be assisted in any number of new, creative ways because there will be more monies do help. Period. How this new, fairer system will disproportionately tax the less-rich is just not an argument when the poor will have more money anyway. It’s philosophical, at best.
“A change on such a grand scale would need to be further researched, and the results shared openly so the work can be checked. The plan should be test marketed in a small area, then implemented gradually so the shift from income tax to sales tax could be made over time. In any event, such a change should not be implemented until the economy has recovered more fully.”
Says who?