Fair Tax advocate says "No Fair"

... because he didn't get chocolate ice cream for his birthday today.  But we still want to wish John "Fair Tax" Steinberger a very Happy Birthday from the Blogland.

While we're not sold on all the details of the Fair Tax system, we're not thrilled with the current system either. Without people like John working to stir the discussion pot, we'll never get the kind of tax reform our state and country needs.

So today, our hats are off to John Steinberger. Thanks for your hard work and have a great birthday!

3 Response to "Fair Tax advocate says "No Fair""

  1. Hank Van Gieson 2/7/12 21:38
    I'm certainly not sold on the Fairtax scheme either. Here are seven criticisms that John might try to rebut when his birthday party is over>

    (1) HR25 proposes that the Federal government tax State and Local government consumption of all new goods and all services,including a significant portion of State and Local government employee payrolls as representative of services provided. Under the long held Supreme Court doctrine of intergovernmental tax immunity, this taxation would likely be found to be unconstitutional.

    (2) Although Fairtaxers claim that the Family Consumption Allowance (FCA) or “prebate” is similar to a tax refund, it is not! The FCA is an income supplement that can be spent (and taxed), or saved as financial circumstances allow. The FCA would be scored by CBO/OMB as a cash grant entitlement costing $600 billion annually at a time when entitlements are squeezing out federal discretionary spending.

    (3) The Fairtax could destroy the new housing market! Banks typically loan the sales price or the appraised value, whichever is less. Appraisers generally do not include commissions or taxes in their valuation. There is no collateral value in a federal sales tax. In order to purchase a new house, buyers may have to come up with funds for not only a 20% down payment but also the 30% sales tax.

    (4) All fifty Governors, through the National Governors Association, oppose any type of national sales tax. The current NGA tax policy paper states: “The nation’s Governors oppose a national sales or transactional value-added tax. Such taxes would intrude into a tax area that has traditionally been reserved for and relied on by state and local governments. If enacted, either of these taxes would seriously threaten the ability of state and local governments to maintain their tax base.”

    (5) The Fairtax plan would destroy our Social Security system as presently structured. (1) Today, workers typically pay FICA for 45 years or so. Under the Fairtax, everyone pays sales taxes on purchases for all their life. (2) Upon reaching retirement age, today’s workers begin to draw benefits and make no further FICA contributions. Under the Fairtax, everyone, including retirees drawing benefits, continue to pay sales taxes for life. (3) Today, benefit amounts are tied to income earned during work years. But, under the Fairtax, that would be unfair because the Fairtax taxes both income and wealth. A major restructuring of Social Security would be necessary under the Fairtax.

    (6) The Fairtax scheme throws middle class retirees under the bus. After tax savings accumulated under current tax law would be directly double taxed when spent, retirees would be forced to resume paying for their benefits with their sales tax dollars, and middle class retirees would see a significant increase in their federal tax burden along with a reduction in their purchasing power.

    (7) The Fairtax rationale for treating all government agencies as consumers is that it would prevent unfair government competition with the private sector. But that issue was dealt with in Section 704 of HR25. Any government agency that sells $2500 or more per quarter would be considered a Government Enterprise, and would have to collect and remit the 23% sales tax. There was no need to tax all government consumption.
  2. Seeker 3/7/12 22:44
    what the hell are you talking about? Fairtax taxes ALL state and local expenditures -- not "a substantial amount" --all. All wages, taxed. All. All pensions, taxed. All. ANd not just wages, but all OPERATIONAL costs.

    Operate a prison, or build a bridge, or fix or run a sewer system - your city or state would be taxed on that EXPENDITURE. Yes, all the salaries paid would be taxed too -- the state or city would have to pay the tax, not the employee.

    But to know that, you have to pull your h ead out of your rear and read the fine print carefully. It does not matter what the liars like Boortz promise -- it's the details in the legislation that matter.


    All expenditures to heat, fuel and supply the jail, taxed. Same for court system, everything is taxed. Same for sewer system, everything is taxed. Police -fire department expenditures -- everything is taxed.

    Every thing taxed -- all expenditures taxed, except education and foreign travel.

    But again, you'd have to pull your head out of your **** and read the fine print. You have to think. you have to ask questions. YOu cant sit there like a bump on a log and expect the liars and con artist to explain it to you.

    They tax all government entities -- including your city. Do you have ANY clue how many millions your city council would owe? Even modestly sized cities -- Sioux City Iowa -- would owe many millions (88 million).

    If you think any city is going to send in a DIME -- you are crazy. And certainly all cities and all counties and all states are not going to send in 23% of their expenditure costs as a tax.

    Don't be so easily fooled next time.
  3. Seeker 3/7/12 22:58
    Fairtax should not be treated with respect. It is a fraud, and they know it. It is profoundly goofy. Not just because of the massive impossible taxes on all city county and states.

    They also tax ALL -- ALL -- ALL -- did I mention ALL medical consumption-expenditures as they call it. All medical consumption is taxed. When you see how goofy this is, you will know that THEY know its goofy.

    You might think only people who actually pay for their medical "consumption" would be taxed. You would be wrong. ALL medical consumption is taxed -- no exceptions whatsoever.

    Even if your insurance paid for cancer surgery --or chemo -- or nursing home care -- you are PERSONALLY liable for the tax. In fact, it does not matter if you pay for it at all. It's NOT a payment tax -- it's a consumption tax.

    Read the fine print. "The person using or consuming the goods or services is liable for the tax hereby imposed". I had 180,000 dollar heart surgery last year, plus I bought a new car, plus I went on vacation -- usual stuff, except for the surgery.

    Do you know how much my Fairtax would be? Over sixty thousand dollars. I don't have that much, and I don't even make that much.

    Do they really expect me to pay 60K in taxes? Hell NO. They don't expect Dallas Texas to pay 338 million in taxes, nor do they expect California state legislature to pay 18 billion.

    But they had to tax all "expenditures" to make their math work.

    You have a lot to learn about this fraud.

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