Graves thanks Linder for his service, promises to reintroduce Fair Tax

In a press release sent out this afternoon, Tom Graves thanked Rep. Linder for his service and promised to reintroduce HR 25 when elected to Congress:

“I wholeheartedly support the FairTax and I am the only candidate in the 9th District that has joined Congressman Linder, Neal Boortz and Herman Cain in campaigning for its enactment across the country.

“When I am elected, those who support the FairTax can be assured that I will continue Congressman Linder’s efforts and will fight in Washington to pass this important piece of legislation. I will introduce H.R. 25 at the beginning of the 112th Congress. I will find other like-minded members to join in the effort. And I will continue to build the grassroots support across the country that is needed to enact this legislation.

“I will stand for the FairTax.

Worry not, Cult of the Fair Tax.

114 comments

  1. Jeremy Jones says:

    At least 4 other candidates in the race support and have campaigned for the Fair Tax. No offense to Mr. Graves, but I believe whoever wrote this quote for him needs to do a better job of fact checking. I know Mr. Graves is well aware of at least 3 of the candidates stance on the topic.

    • tarheel7 says:

      There is a difference between supporting the Fair Tax and having actually “join[ed] Congressman Linder, Neal Boortz, and Herman Cain in campaigning for its enactment across the country.” Graves is the only one to have done that. The statement does not say that he is the only supporter, just that he is the only one to have campaigned for the issue with the people aforementioned.

  2. NealHoward says:

    I am well aware that Jeremy Jones is not only a supporter of the Fair Tax but based on conversations I have had with him regarding the subject, he is probably the most knowledgeable candidate regarding the Fair Tax.

    It’s the very first link on his website links page.

    http://jonesforus.com/links.htm

      • IndyInjun says:

        Indy ain’t in the 7th or taking the 5th.

        Linder still needs to explain what Global Insights came up with when they scored it and his comments at the time.

        It seems that the rate would have to be substantially higher, virtually the same as Bush’s Tax Reform Commission estimated.

        Lets put it this way. If the audience is the AICPA I can promote it. If the audience is the public I can warn of why accountants will love it.

        Talk radio has people sold on the FT the same way AIG sold bankers on Credit Default Swaps that threaten the entire world financial system.

  3. IndyInjun says:

    (hahahahahahahahaha……)

    It is obligatory to be for it.

    Amazing. The FT taxes operations of state and local governments with its 30% rate.

    How is that good for a state government that has already lost $4 billion of revenue?

    Boortz’ s radio platform has the entire Georgia GOP intimidated into supporting a policy that would destroy state finance on many levels.

    I wish all success. If you get there I am coming out of retirement.

    Let the fun begin.

      • IndyInjun says:

        Even more, Karen Handel, Eric Johnson, and Austin Scott need to have an Indy session. Ox and Deal have endorsed a plan that destroys state finances.

        When the AICPA wants to hear about the FT, I will do my “Fair Tax is a Wondrous Bounty for Tax Accountants” side of the debate.

        The 7th will go to a FT sycophant.

        That entire district has drunk the kool-aide.

  4. Jeremy Jones says:

    How about this, I do not care what the rate is. I do not care if it 60%. I want 100% of the taxes for the federal government to be paid directly by all people in our country. Not by businesses, not by fees, not by paycheck deductions.

    The only way, to my knowledge, to have this is to enact a national sales tax, consumption tax, Fair Tax, or whatever you want to call it.

    People are blinded to the amount our country is in debt, and how much our government spends. Once EVERY American directly, and constantly, pays taxes, we will not control federal spending, or federal promises.

    If we tomorrow abolished all taxes and went to a consumption tax, what rate would it need to be to maintain current spending (including deficit spending), 25%, 30%, 50%? Whatever the rate is, it will be perceived by many to be too high. Maybe, just maybe, citizens will start to pay attention to the promises, and price tags, made by politicians. Maybe then we will not be so fast to jump on a fiber optic network bandwagon, or a health care promise, or department of eduction increase? Maybe then people will realize the true cost staring us in the face with a 50 Trillion dollar promissory note coming due, increasing every day in size.

    Assuming the naysayers of the Fair Tax are 100% correct, their point strengthens mine.

    • John Konop says:

      Jeremy,

      Are you being serious? This is flat out crazy! Ideology does not pay the bills!

      ….How about this, I do not care what the rate is. I do not care if it 60%. I want 100% of the taxes for the federal government to be paid directly by all people in our country. Not by businesses, not by fees, not by paycheck deductions….

    • Mozart says:

      People like Jeremy Jones and Tom Graves like to chat wildly about the FT, but they never point-out the wee little fact that in order for the FT to be realized, they have to have the balls to repeal the 16th Amendment. And, there are not enough votes in Congress to repeal the 16th Amendment.

      • IndyInjun says:

        I don’t know why not. It isn’t collecting any revenue these days.

        I think they should repeal all taxes and just run Bernanke’s ‘printing press’ to fund government Its what is going on, so let’s just make it official.

        This makes the gold bugs supremely happy.

      • Jeremy Jones says:

        No, I do not point that out each time (repealing the 16th Amendment, because I do not feel it prudent to explain every detail on the plan every time it is discussed. Though the book is not in front of me, I know the only way the Fair Tax could be done, should be done, is to repeal the 16th. However, to me, that is not the hard part. The hard part is getting 300 or so people with enough guts to remove the only thing they have to ensure they keep power as long as they want it, the targeted, progressive, tax code.

  5. IndyInjun says:

    Good Jeremy, your love for a consumption tax is shared by Pelosi, Obama, and Reid.

    They are just itching for y’all to promote a national sales tax.

    All ABOARD!

    • BubbaRich says:

      I’m probably the most liberal libertarian around here, and I’m hugely in favor of a consumption tax of some kind. I was working for a visiting delegation from the Finnish parliament a few years ago when I lived in DC. They were rebuilding the Finnish tax system, and were looking for recommendations from all over the political map. We visited W’s Fed and Treasury Dept, the liberal Urban Institute, centrist Brookings Institution, libertarian Cato Institute, and a couple of other sources. They all said roughly the SAME THING:

      1) Consumption taxes are preferable to income, capital, and capital gains taxes, because they distort markets (in destructive and hard-to-manage ways) far less.
      2) The US system takes the worst choice and makes it a FAR worse system, with substantial inefficiencies and extra expenses introduced in many levels throughout the system.

      My main concerns about the Fair(hah)Tax are that its proponents keep lying about the tax level required to be close to revenue neutral, and also that I think removing the tax benefit for home ownership would be a disasterous even for our communities. A side note to that problem is that I also don’t believe that state nor federal legislators will give up their massive stick and carrot of tax policy and tax loopholes. It would be hard to earn their bribes without that.

      • benevolus says:

        Can you show any evidence that Brookings supports a consumption tax? I can’t find anything there, and it surprises me that they would take that position.

  6. GOPGeorgia says:

    Please chime in if you like the current tax system. If you don’t like it, please propose something better.

    • IndyInjun says:

      Tariffs worked fine for 120 years or so and they are needed to restore manufacturing.

      A flat tax works fine in Eastern Europe and even increased the revenue take. It would not hurt state sales and income tax revenues either.

      Ab out 4 years ago, there was a presentation to the tax reform committee about a universal transactions tax, collected through the banking system. Jim Demint has a variation of that.

      • Icarus says:

        Missers Smoot and Hawely are awaiting their vindication. I’ll start digging now. Perhaps I can have them excavated by the time you get this one passed.

        • IndyInjun says:

          Here’s a prediction for you.

          Tariffs will make a come back and soon.

          It is time to stop the unilateral disarmament in the face of mercantilist competing nations using currency devaluation to eviscerate US manufacturing.

          You came up around government dependent airlines and approve of bailouts. I come from manufacturing, an indispensable value creator for first world nations, an environment that needs government to quit knee-capping it by subsidizing competition and letting them erect currency tariffs.

          Or do you believe in unilateral disarmament?

  7. IndyInjun says:

    Here again, you are on the side of Reid and Pelosi. They yearn to be able to tax the accumulated savings of retirees, who usually don’t have taxable incomes as they pay down savings in retirement. Now that interest rates are arounf 2%, retirees are seeing their pay-outs accelerate and their taxable income go to ZERO. A national sales tax increases as costs of medicine, food and energy – all of them inflating now – increases with inflation.

    A sales tax is an excellent way to get taxes out of the elderly’s already taxed income.

    I got this objection from Isakson’s staff 6 years ago, BTW.

    Besides, what I just heard from you is this –

    “Damn the facts, I am going to pass a bill that I have not read and don’t understand.”

    You sound like John Conyers talking about the health care bill.

    • GOPGeorgia says:

      I am not sure if the “You’ is for Jeremy or myself. If it’s for me, my request still stands. Please let us know if you like the current tax system or what you propose to replace it with.

      • IndyInjun says:

        See above. My preferences are 1) Transactions/sales tax 2) Flat Tax 3) Tariffs.

        Prediction – We are going to get a VAT and GOPers will vote for it after 11/10 and the point will be moot.

        Government spending has to be funded somehow and it will be with a VAT and income tax. I hate it but that is what is coming.

        • GOPGeorgia says:

          I think that the GOP Congressmen we send to DC next year will be smart enough not to vote for a FT without a constitutional amendment. I haven’t said I am in favor of the FT on this thread, but I’ve said that I am many times before as long as there is an amendment to back it up.

          Your transaction tax is probably not that much different than the FT. I’m OK with a flat tax, depending on the details. I disagree with on trying to run the country, or any major portion of it, off of tariffs,

          • John Konop says:

            The biggest problem with the economy is the trade deficit. You cannot consume more than you produce and sustain a healthy economy! Tariffs should ne used for trade violators! If not why even have a deal?

            • IndyInjun says:

              China has used Currency manipulation as a proxy for tariffs for years.

              The US has paid huge % of GDP to provide national defense for trade competitors, a tax on US taxpayers to benefit Japanese industry!

              Are we suicidal, or what?

            • Mozart says:

              For the same reason we have laws with no punishment mechanism when people break them: Because legislators can boast about the law they proposed, voted for, and that got passed, but never have to worry about the consequences of their unenforceable laws.

      • IndyInjun says:

        YOU was JJ in this case.

        GOPGa posted in favor of the FT? I must have missed it.

        Besides, that is in the commentary line for Jeremy.

        Yeah, I get mixed up by this new thread response hierarchy too.

  8. btpull says:

    How about reducing the scope of government first? If my effective tax rate (actual taxed paid/income earned) is small enough I really do not care how it is collected.

  9. Jeremy Jones says:

    To be clear, my intention is to reduce the size of government. When everyone pays, and everyone pays more when the government spends more, the less likely of the, or at least the slow abatement of, increased spending.

    50% of Americans do no pay direct federal income taxes, therefore are much less likely to care about government spending. You know the rest.

    • btpull says:

      The easiest way to accomplish this would be to take the Federal Budget ($3.8T for 2011) divided it by the number of people over 18 (230M approximately), which equates to $17K per person for the 2011.

      • GOPGeorgia says:

        ….and what are the odds of that happening? I don’t think most kids who are 18 have that much in the piggy bank.

        • btpull says:

          An income factor could be added such that your taxes would be some percentage of the calculated burden; for example, if you make $30K a year then your federal taxes might be 10% of the Federal burden per person or $1,700 based on the above calculation. This would, also, require someone else to pay 190% of the burden.

          Either way if Federal expenditures are increased 10%, then everyone’s taxes will increase by 10%. If a trillion dollar health care bill is passed, then everyone’s taxes will be raised proportionality. If this measure is suppose to save money in the long run, then people will be looking for the tax savings. If the savings do not materialize, there is a direct link of accountability from the tax payer (everyone over 18) to the politicians who promised the savings.

          • benevolus says:

            The only difference I see between that and what we have now is that you seem to be asking for a requirement that we have a federally balanced budget (perhaps a year in arrears).

            • btpull says:

              Except your tax liability would be directly tied to Federal spending. Generally under the current system the only reason my taxes go up or down is if I make more or less money this year compared to last year.

              The Federal Budget could double, but it does not have a direct impact on individual tax liabilities at least in the short run so the average person is not generally concerned about Federal spending.

              If we had a system where an increase in Federal spending would automatically increase EVERYONE’s tax liability or a decrease would automatically decrease EVERYONE’s liability, our whole political dynamics would change. How many voters would want their representatives to go to Washington to increase spending when they know their taxes will automatically increase?

              • IndyInjun says:

                Shoot, that way Congress would have to go back to declaring war and paying for it.

                We can’t have that (snark ON.)

    • IndyInjun says:

      Good, like BT, cut spending first, then do the taxes.

      Make no mistake, the cuts MUST BE painful and leave nothing off the table. Not SS, defense, or any GOP sacred cow any more than any Dem sacred cow.

      Survival is at issue.

      • Jeremy Jones says:

        “How do you pay for a Medicare system that pays…”

        I do not know how Medicare is involved with this thread other than it is a budget item that must be paid for with taxes.

        Unlike some politicians, I do not pretend to have all of the answers. On such issues, that also fall into the category of important, I study up on them and will defer my answer to those I trust are much smarter than I. The book, “The Coming Generational Storm” by Kotlikoff and Burns (Laurence and Scott) has a well defined, and acceptable plan. I might add, the book is against the Fair Tax as well, though for reasons different than what I have read here.

        The bottom line, you don’t. You begin the process of eliminating Medicare and replacing it with a system that can fund itself. Since there is about 75 pages in the book written on the topic, I shall not insult it, or you, by trying to abridge in a blog post.

        I would be happy to buy the book for you if you wish.

    • AubieTurtle says:

      Ideologues have a tendency to throw temper tantrums when they can’t get everything to conform to their narrow vision of how the world should be.

      There’s a reason why the two major parties are filled with hypocrites that speak out of both sides of their mouths: compromise gets better results than the ‘all or nothing’ views espoused by those hanging out on the margin. Flawed results, yes, almost always. But at least it isn’t like those who have wrapped up their ego and self identity so tightly into an ideology that they’d rather destroy everything than not get 100% of what they demand.

  10. Game Fan says:

    I never saw such excitement over a new tax. And why does the fair tax crowd go out of their way to avoid the “get rid of the income tax” people? According to the fair tax people, “getting rid of the income tax” is part of the plan. Of course they might need some overlap for a while, eh? You know, because of the budget. And who knows what kind of monstrosity this thing would be by the time it gets through Congress. It could resemble a VAT or a poll tax. Ya never know with Congress.

      • IndyInjun says:

        A couple of weeks ago I encountered an old crusty guy from Ohio who listens to Boortz. When I started trying to explain why the FT screws him, he just about exploded at me.

        When Jason said they were a cult, he was not lying.

        I really do take this from the perspective of the average citizen. It is a matter of policy.

        Make no mistake. If they insist on harming themselves after I have tried my level best to warn them, don’t think for a minute I am going to lose sleep over making a fortune on their stupidity.

      • Game Fan says:

        “It could resemble a VAT or a poll tax”.

        Er, looks like Indy already covered that, sooo…

        It could resemble a VAT or a poll tax or a federal Interstate toll, or a “superspeeder with a lit cigarette” tax or an “internet bully user fee”, or…

      • Game Fan says:

        Well, anybody who isn’t fighting the entire concept of an income tax, is pretty much allowing it to continue. In fact there’s considerable debate as to whether even the existence of the IRS and the income tax lies outside the purview of Congress and the courts. In other words it’s one big hairy beast that isn’t going to just go away because of laws or court decisions. It just ain’t gonna happen. So avoiding this half of the issue makes it this much more conceivable that we could wind up with both real easy.

  11. NealHoward says:

    @Indy – “A sales tax is an excellent way to get taxes out of the elderly’s already taxed income.”

    They are already paying the additional taxes as embedded taxes in every item they purchase. As far as I know you don’t go to the store, present your AARP card and have your taxes removed.

    This way at least they would see it.

    AND they would get a prebate back on the necessities which they are not getting now.

    • Mozart says:

      “Prebate” is the most hilarious concept. You actually believe the government is going to be able to build such a record system as to send checks to every household at the beginning of every month?

      If identity theft wasn’t so much on the rise now, it will go-up 100,000-fold when the government starts sending checks in the mail to every household.

      It’s amazing how ignorant people are to think that our federal government is that on top of things as to be able to design and implement such a system as to send you money in advance. Oh, my! That is a rib-breaker due to the laughter any IT person should have if they thought about this “prebate” concept for 3 or less minutes.

      • IndyInjun says:

        Great answer….

        A totally new agency, bigger than the SS Administration – it stays intact – to send out more $billions to dead and nonexistent people.

        And this is a “republican” idea? hahahahhahahahahaha!!!!

  12. IndyInjun says:

    Neal,

    Tell me this.

    If this that much embedded tax:

    1) Why didn’t the FT people reduce the available tax base by the supposed 22 to 26% embedded tax savings when they calculated the 23% inclusive/30% Exclusive rate? Following the math makes for the inescapable conclusion that the FT people don’t believe it was that high.

    2) Why did Boortz have to retract the statement that “you get 100% of your paycheck” as opposed to there 22 to 26% embedded tax claim. The reason is that one FT consultant included all federal income taxes and SS taxes withheld by EMPLOYER AND EMPLOYEE in getting to the 22- 26% embedded tax number, when most of these taxes are included within salary, then another FTer came up with the 100% of paycheck claim.

    3) Why is it, when one reviews the financials of 6500 public corporations, using Valueline Data, that one sees that corporations pay only 1 to 2% of REVENUES, the basis for the FT in cash lay-outs for taxes yet the 22% embedded taxes are used? Answer – corps don’t actually pay anywhere near the high tax rates that they wail about. The only way to get to 22 to 26% is to include federal income taxes, SS, and Medicare taxes included in salaries and do so at all levels of production, without regard to the fact that most goods and components thereof come from China, where there is no embedded US tax.

    4) If you are a GEORGIA politician, given the foregoing indesputable facts, are you REALLY going to subject state, county and city purchases of goods and services to the 23/30% Federal Sales tax? How, mathematically will doing so NOT make costs of Georgia government simply explode?

    5) The 25% financing break that state and muni bonds get arises from the exemption from Federal income tax on interest paid to debt holders. What happens when that exemotion goes away and Georgia’s debt has to compete head-to-head with risk free US bonds and high grade corporates.

    6) FTers claim that you don’t have to keep receipts or file returns. The FT bill says you do.

    7) FTers claim you won;t be subject to audit. The FT bill says you are.

    8) Under the FT any interest in excess of the set Federal rate is considered a taxable financial service. How is paying the 23/30% FT on top of 22% credit cards going to work for the state and consumers. Hell Georgia DOR charges 12% interest and 2/3 of it would be federally taxable.

    I have more, tons more and every bit of it is rooted in the FT Bill, the FT book, and decades of sales tax jurisprudence.

    Let’s rock.

    Education ain’t my game.

    This is.

    Ready when you are.

      • IndyInjun says:

        JK, the gubernatorial candidates running on this nutty scheme deserve what they get.

        Can you imagine Deal, with his record of perfidy and his picture alongside Charlie Rangel on the 15 Most Corrupt Members of Congress, running on this con game against Roy Barnes?

        How about Ox and his countless faux pas, corrupt campaign finance, no-hunter safety/no license expert hunter claim, Crown Vic Crashing and all else running on it against Roy Barnes.

        Running on paying a 23/30% Federal tax on state purchases when said state is down $4 billion in revenue???????

        How many funds for teacher salaries will that incinerate?

        This is about as funny as it gets in politics.

        This I have GOT TO SEE.

        • Mozart says:

          I would like to “see” it as well. Preferably from a location far away from the United States where I can watch it with a satellite TV as households don’t receive their “prebate” checks and start looting.

      • John Konop says:

        Jeremy, by you not replying to the points Indy brought up in his post, it is clear you do not understand the FAIR TAX! Why would you support a bill you cannot even defend fiscally?

        • IndyInjun says:

          JK, Don’t be too hard on Jeremy.

          Talk radio has drummed it into their heads and it is now a cultism.

          John Conyers scoffs at reading bills and so do Georgia
          ‘republicans’

          We have, in reality, one party and it uses divide and conquer tactics.

          There are almost no REPUBLICANS by the professed standards of that party.

        • Jeremy Jones says:

          John,
          As I have said countless times, I simply believe the Fair tax is the best alternative, currently, in placing the entire federal tax burden directly on the people, which is my goal. I am tired of taxes being hidden from people within business taxes and regulations.

          Though I am sure Indy’s research is as valid as is any other person’s documented research, his points really do not negate the my stance on the Fair Tax. His entire argument, from what I can discern, rests in the fact the FT would be higher and more burdensome than proponents advocate. That is not a point, in my mind, that negates the feasibility of it. In fact, in my mind, it strengthens the need for it, and it strengthens my contention that once the American people realize exactly how much our government costs us, we will be more vocal in our opposition to endless government programs, across the entire political spectrum.

          I even pointed out other options to facilitate my goal. Though I am a proponent of the Fair Tax, I am more than willing to listen, research, and verify any other alternative that accomplishes my aforementioned goal. The FT is simply one that does it, and already has a broad support base.

  13. IndyInjun says:

    Medicaid costs for Georgia are exploding.

    These expenditures would be FairTaxable.

    Got another 23/30% to spend on Medicaid, GOP candidates???????

    Where?

    Teachers are hurting, so why aren’t you raising this ‘spare’ revenue now?

  14. Jeremy Jones says:

    In case it has been lost in all of these posts, let me again clarify my position. My support for the Fair Tax rest solely on the idea that people will start paying the true cost of government rather than the cost of government being hidden in fees and taxes to be paid by businesses.

    No matter what the rate for the consumption tax is, it will be too high.

    Our society today has no clue how much the government spends, and how much said spending costs them, especially those that do not pay any federal income tax. Until a vast majority of people understand how much they pay in taxes we have no chance of cutting social security, medicare, medicaid, and any program you might consider a waste of money. Almost half of Americans can say with a degree of ignorant truth, no matter what the government promises or spends, it will not cost them anything.

    But, as we all know, it does.

    For instance, though not a tax, the point is the same. I will now be charging a $2.00 fee for each credit card transaction. I am doing so because my processing rates just went up because of the new government mandate on credit card companies. (This is not a debate on that, though a good one could be had) The structure and result are the same if it had been a tax. Had the government raised the taxes on the Credit Card companies in the amount equal to what the CC companies can now no longer collect from consumers, with the cavieat they were not allowed to raise fees/rates on consumers, the CC companies would have done exactly the same thing, raise processing rates. The CC companies will continue their profits. However, now, consumers think they are not since their interest rates are locked, fees are limited etc. It is only the relative few people who own businesses that see these increases, completely hidden from the public. However, over time, these new charges will filter down to the consumer, as every new fee/tax does.

    • John Konop says:

      Jeremy,

      This is not true. Your rates went up because people are defaulting on credit cards that were used to buy products business sold, like your business. You have the right to not take the cards and take the risk yourself!

      Like healthcare you want it both ways! You want the freedom to not have health insurance, but at the end you want someone to bail you out or give you a break if you do not have the money.

      FREE LUNCH Politicians like you are why we are in debt!

      …For instance, though not a tax, the point is the same. I will now be charging a $2.00 fee for each credit card transaction. I am doing so because my processing rates just went up because of the new government mandate on credit card companies…..

      • IndyInjun says:

        Incredibly, Jeremy’s $2.00 processing charge would be Fairtaxable as a financial service and would become $2.60.

        • John Konop says:

          GOOD POINT! That would be a ton of tax revenue if the tax was 30% surcharge on every payment transaction ie checks, debit, credit cards, BW, ACH, E-check, healthcare claim processing……… Boy it would piss off consumers and the business community!

        • Jeremy Jones says:

          Yes it would. However, the point, in my opinion, would be moot, as if the FT were in place, it is my belief the government would be so small, such legislation would not have come about.

          Regardless, all things being equal, for me to gain a $2.00 increase to cover the anticipated cost of doing business for me would be an amount higher than the $2.00.

      • Jeremy Jones says:

        John, to a certain point, you may be correct. However, my interstate rates have not gone up a measurable amount since the credit crisis. I do believe most of the losses are being recouped through consumers directly. But I am specifically speaking about the specific bill that has just gone into effect. That bill is restricting the ability of CC companies to recoup losses from the segment that is causing most of the loss, medium to high risk consumers.

        To be clear, the new fees have not yet come down, and if they do not, then I will not enact the fee. However, I have been told by several trusted people, most banks are looking at raising their interstate rate very soon after this recent law went into place. I am simply preparing for what I believe is coming.

        You say politicians like me are why we are in debt? Really? We are in debt because politicians over the years did not want to hide the true cost of government from the people? Because politicians only cut taxes with equal, or greater, spending cuts? Because politicians over the past years have advocated against unconstitutional federal spending? Because politicians have desired to repeal the 16th and 17th Amendments?

        That sir, is the type of politician I am. That sir, is what I advocate most any chance I get. We are in debt because the politicians’ constant desire for power, influence, and popularity have created, possibly, the biggest smoke screen between the government, the people, and their money the world has ever seen. Until that screen is lifted, we have no chance of solving the problem.

        • John Konop says:

          Jeremy,

          Wrong again! Almost every April the interchange rate goes up for merchants, and this year was on the low side. You should take notice of what you are paying better.

          You Said:

          …..John, to a certain point, you may be correct. However, my interstate rates have not gone up a measurable amount since the credit crisis…..

          How exactly?

          ……That bill is restricting the ability of CC companies to recoup losses from the segment that is causing most of the loss, medium to high risk consumers……

          Interest rates are going up because the FED has kept at an artificially low rate to help banks re-capitalize after all the losses mainly in real-estate.

          …..I have been told by several trusted people, most banks are looking at raising their interstate rate very soon after this recent law went into place……

          Finally I actually agree with a lot of your final two paragraphs. But still many of the people you point fingers at have the same view you have of wanting something for nothing. In a credit card transaction you realize as long as you provided the service as promised the credit card company is on the hook for the transaction. And if you could afford to provide the credit to your customers cheaper than you should and not use credit cards. But at the end of the day like healthcare someone has to pay!

          • Jeremy Jones says:

            John,
            I do not wish to extend credit to my customers. There are plenty of companies (banks) who do wish to extend credit. I am not in the business of credit. My accepting the payment from a company that is willing to accept risk is not a point of debate? Is it?

            As to my rates not going up, I know my rates have not gone up. Now, it may be, and I do not have the contract in front of me, I signed a contract locking in rates, or maybe the processor I use has insulated such hikes. I checked before I made the post and my average rate per transaction has not changed since I first started taking credit cards several years ago.

            As you well know, there are literally hundreds of rates depending upon the card, I am not going to take the time to research each card. I am comfortable with my data showing my rates have not gone up.

            • John Konop says:

              Jeremy,

              Wrong Again read your CONTRACT. The contract stated that your rates will not go up via the term except for interchange increases. How much do you want to bet on this?

              ….As to my rates not going up, I know my rates have not gone up. Now, it may be, and I do not have the contract in front of me, I signed a contract locking in rates, or maybe the processor I use has insulated such hikes……

              • Jeremy Jones says:

                I do not wish to bet anything, CC are such a small part of my business, I seldom even open the monthly statements. I simply keep historical data on cost to process the cards for tax purposes.

            • John Konop says:

              Yes that is the core of the debate! Your rates went up to pay for customers who did not pay their credit cards. The bill you stated had nothing to do with it.

              ….I do not wish to extend credit to my customers. There are plenty of companies (banks) who do wish to extend credit. I am not in the business of credit. My accepting the payment from a company that is willing to accept risk is not a point of debate? Is it?…..

  15. Jeremy Jones says:

    So, while we can certainly have a legitimate debate on whether or not the FT is the best idea, or even a good idea, I firmly believe the solution to root problem of government spending and expansion rest solely in the idea that all government funding come directly from the people, all of the people, all of the time.

    You want to make it a flat tax? Fine. Heck, if you want to keep the nightmare progressive tax system, but eliminate all deductions/credits, etc, as well as the 0% bracket, I would concede to that idea. But the key is, every single person must start paying something directly to the government. That something must increase with each increase in the budget, decrease when the budget gets smaller (I almost laughed myself silly with that comment :)). Until then, politicians will continue to the… you know the rest.

  16. IndyInjun says:

    JJ,

    We agree on shrinking government.

    You are absolutely correct that the FT rate (or any other tax rate) has to be high because of enormous government, so high that paying the cost of government will create reform.

    100% of the population now has one or more entitlements. No one will give them up. The coming US government default will wipe them all clean.

    Shadowstats.com puts the real deficits at many multiples of the $1.6 trillion Obama admits to.

    There is no way on earth to pay for the government we have except by the Fed perpetual money machine.

    You are right all around, except on the FT as a vehicle for tax reform.

  17. IndyInjun says:

    The FT is the least of everyone’s worries.

    Once the US Government defaults on its debt and is forced to reduce in size and spending by 70%, a sales tax, VAT, or flat tax will suffice.

    The US government WILL DEFAULT, either outright or by inflation. It is trying mightily to bring about the second result. The people will never accept a sales tax that hyperinflates with the necessities of life and retirees, who vote in huge numbers, won’t accept a 30% tax as they draw down previously taxed savings on said necessities.

    Probably the most devilishly devious aspect of the Fair???Tax is that it would result in a 30% tax on Grandma’s nursing home care of $60,000 a year (a tax of $18,000, but’s lets give the FTers benefit of 20% embedded tax and say it is “only” $15,000) while giving corporations immediate tax FORGIVENESS of more than a $trillion.

    What kind of person calls this “Fair?”

    • John Konop says:

      Jeremy

      Products sold in Fair Tax world.

      Sold at $100

      FT tax $30

      EST. Local tax (7%) $7

      FT transaction tax .60

      Total $37.60

      Products sold now

      Sold at $100

      EST. Local tax (7%) $7

      Business Income Tax $2

      Total $9

      A consumer trades a 2% imbedded tax over 30% ? Please help me understand your math Jeremy? And you are going to send rebates checks back to 50% of tax payers paying no federal income tax now?

      And now the average family will pay 30% with the FT and now they are paying 24% how does this FT help the average family?

      http://www.smartmoney.com/personal-finance/taxes/whats-your-average-tax-rate-9548/

      • Jeremy Jones says:

        First, I disagree with your premise.

        Second, if your premise is 100% correct, it does not change my main reason for wanting the FT, to get 100% of Americans paying federal taxes.

        We must stop turning a blind eye to our financial problem. Every year of inaction is just like more pressure building up on a fault line. The longer we wait, the more devastating the relief will be.

        If fixing the budget requires the average family going from a 2% effective tax rate to a 30% effective tax rate, so be it. I promise, a 30% tax bill will quickly light a fire under people to change the direction of Washington more than any TEA party ever will.

        • John Konop says:

          Jeremy,

          Show us with math why disagree with my premise?

          1) If the average corporation pays only 1 or 2 % tax on income what else could be embedded in the current system?

          2) You understand the bill has nothing to do with local tax rates?

          3) You understand the charge is 30% on the product with FT?

          PLEASE show me how I am wrong? And if you want a national sales tax to balance the budget you do not need to change the Constitution. I am lost what is your point?

          • Jeremy Jones says:

            1) I guess anyone can find anything they want, but I do not accept the idea effective corporate tax rates are below 20%, much less 2%.

            http://www.taxanalysts.com/www/features.nsf/Articles/9B96723BDBA236078525744B0060BAFA?OpenDocument

            2) – of course I know that. It does not have any direct effect on local tax rates. ( I would say the eventual effect would be to increase local rates as the federal rate falls with the shrinking size and scope of the federal government. This would be decades, but, I believe it would happen.

            3) I understand the difference between inclusive and exclusive taxes. I also understand, as apparently you do not, the rate is not set and should be lower to fund a smaller government. But, that is a differant debate and the proponets of the FT claim they only want to fund the government at its current level. A claim I do not support. If possible to enact such a major fundamental change in government, to tag along major cuts and department eliminations should be a component of the FT.

            We do not need a Constitutional amendment to enact the FT, however, I, along with most FT supporter I know, would not support the FT without at least repealing the 16th Amendment. I would like to add my own Amendment regarding the method by which the FT can be raised and/or lowered, but again, a differnent debate for another day.

            • John Konop says:

              Jeremy your lack of math skills is showing again! You pay income tax on net earnings after write offs! A company only makes on average on the high side 5% off the gross after write-offs.

              ONCE AGAIN show me how a corporation on average is not paying 1 or 2% on the gross for income taxes?

              You do understand the FAIR TAX IS ON THE GROSS!

              FT is 30% on the GROSSS not net earnings!

              • Jeremy Jones says:

                John, then you should say companies pay 1% – 2% on revenue, not income. They pay over 20% on income/earnings. I simply answer your questions. The fact you use the wrong terminology should not be held against me when answering your questions.

                You said:

                “If the average corporation pays only 1 or 2 % tax on income what else could be embedded in the current system?”

                • John Konop says:

                  Jeremy,

                  It is clear we are comparing the 30% under the Fair Tax verse the 1 or 2 % a corporation pays on the gross. Do you agree or disagree with the math and if not why?

                  And do you understand the consumer will pay 30% verse the current embedded cost of 1 or 2%? And any extra embedded cost is from taxes or fees that do not go away under the Fair Tax.

                  It is important to have your facts straight when you are running for office. The point about the credit cards is not about your lack of understanding your own business it is about you making false statements.

                  I have some issues with the credit card bill, but I do not just make up arguments against it.

                  The same is true about the Fair Tax. If you do not understand the math surrounding a bill how can you support it?

                  • Jeremy Jones says:

                    I have answered this several times within this very thread, not to mention elsewhere. Do not take my refusal to answer it for the nth time as any other than that what it is, me being tired of having the same mundane argument with you over something you and I both agree with – The government cannot pay it’s bills/promises and we must enact something to either pay the bills or repeal the spending. The more you point out the FT rate will be too high, the more you make my point of how good it is for my desired end result.

      • Jeremy Jones says:

        Also, and I am more than willing to concede I am an anomaly, but under the FT, with all things being equal, my prices will drop about 20-24% to maintain my same profit margin. I have done that math, several times. Part of this is the lack of tax deductions, my tax bracket, plus the SE tax I pay.

        I am a 100% service based business. I make no claim of having done the math for every other, or any other, company in the world. I know one example does not prove anything. But, it is one example, an example that I would bet is true for most service companies.

        • John Konop says:

          Jeremy,

          Nothing personal but your math skills and understanding of your business contracts shown on this thread is not looking very good.

          ….Also, and I am more than willing to concede I am an anomaly, but under the FT, with all things being equal, my prices will drop about 20-24% to maintain my same profit margin. I have done that math, several times. Part of this is the lack of tax deductions, my tax bracket, plus the SE tax I pay…..

          • Jeremy Jones says:

            You point out one minor contract within my business. My business is not rocket science. To paraphrase The Eagles, I have lawyers that take of it all.

            My math skills are quite above average, or at least that is what The University of Cincinnati Mathematics department claims, as well as several Phd’s in statistics.

      • Jeremy Jones says:

        I am sure you have the answer, thus me asking the question. Your 2% embedded tax is for the one company (again, I disagree with your figure, but will accept for this thread). Is there a 2% embedded on the distributor? The manufacturer? The supplier(s)? If you claim the 2% embedded is per business, you surely realize the product goes through several businesses before reaching market.

        Now, even if my example is completely accurate in regards to your example, I have only shown a maximum of 6% more (though the number would be slightly lower for obvious reasons) still a far cry from my 20% claim.

        However, if I left out something of the sort, you would be all over it.

        As the old saying goes, no one person can make a pencil. How many entities touch the materials needed to create the pencil before it gets to the manufacturer, supplier, distributor?

        I ask, because I want to learn. I tell, because I know. There is a difference, I hope you see that.

        • John Konop says:

          Jeremy let me help you with math. A corporation on the high side nets about 5% after write offs on the gross. How could a corporation on average pay more than 1 0r 2 %? Once again show me the math?

          You may be confusing local taxes but that has nothing to do with the FT.

    • macho says:

      Corporations don’t really pay taxes, it’s imbedded in the price of the products they sell. It’s really just a question of wanting to deal in reality, paying an acknowledged sales tax on the products we buy, or pretending that fat cat executives for corporations pay for all of the corporate taxes and unfunded mandates out of their personal Leer Jet and Ferrari allowances.

      I just as soon corporations pay no taxes, so the American products I buy would be cheaper and more competitive. But, if you want to look at if from a populist, let’s get the corporations standpoint, an overall sales tax would actually ensure a more equitable contribution from corporations. Currently, only American corporations pay all of the huge American taxes, contributing to many corporations moving operations oversees. Under fairtax all corporations, American and international would be treated equally. The doll made in American and the doll made in China, with lead paint and child labor, would at least be on a level tax playing field.

      • IndyInjun says:

        Given the degree of monopolistic or oligopolistic ‘competition’ I agree with that.

        Where there is competition the corporations indeed pay the taxes out of earnings, just as an individual does. The ability to pass on taxes is sheerly a factor of competition.

  18. IndyInjun says:

    I admit that my research is 4 years old, but it should remain valid.

    I looked at the average federal income tax cash outlay as a % of sales, SALES being the base for A SALES TAX. This average was less than 3% of SALES.

    I also figured the employer portion of SS across all reported labor costs, even though a lot of folks are capped out before the year is up.

    The most I could come up with in embedded taxes was 12%. You cannot get higher than that without counting federal taxes included in employee salaries. Remember the employee gets 100% of his paycheck.

    As a PERCENTAGE of SALES the embedded taxes are at most 12% and probably more like 8%.
    ———-

    Income tax-
    Yeah, I know that corps scream about ‘paying’ the highest income tax rate in the world” but that is a lie.

    I also looked at the SEC Filings of 20 major corporations and found that the 20 had more than $200 billion of deferred income taxes under the existing system. These are essentially “back taxes” to be paid in the future.

    Passage of the FT means forgiveness of deferred income taxes and these I would estimate at more than $1 trillion given the limited number of companies I looked at having $200 billion in the aggregate.

    • Jeremy Jones says:

      As I have consistently said during my campaign, the US does not have a high corporate income tax. We have a high marginal rate, but a low effective rate. (comparatively) I do not use this numbers when discussing the FT, but rather when asked why do companies take their business out of the country. Regardless, the data is the same.

      Also, John wants to keep trying to prove your point, and as I have stated over and over again, I do not care WHAT the rate is. My goal is to have people pay for their government directly. If that is a 30% FT or a 3% FT, so long as the government is funded I am fine with it. (with the FT, not the spending ;)).

      I do not dispute the shortcomings of the FT. However, I know it is the best chance we have at getting a system in place where everyone will start paying taxes. Thus my support. If another plan gains momentum that will have the same result as I desire, I am open to support it.

      • IndyInjun says:

        I absolutely agree with you that anyone going through the exercise of verifying rates and such under the FT will come away stunned at how much the government is spending.

        Federal debt to GDP is already greater than 100%. If you throw in state debt, entitlement and GSE’s the estimates exceed 300% of GDP. US Debt at all levels is said by some to be 1000% of GDP.

        Anyone who thinks that the FT is even an issue, given the FACT that the USA is utterly bankrupt, is delusional.

        As someone wrote elsewhere ” We are so f#[ked, we cannot even catch a bus back to just plain f#[ked”

  19. richie.rashad says:

    FAIR Tax sounds good but we have an estimated $1 billion lost from GA sales tax collection this past year = how will the FAIR tax stop sales tax cheating?

  20. richie.rashad says:

    by the way, has anyone else heard of Mark Marietta? He would destroy some of these Linder-wannabes in a debate. Mark Marietta out of Snellville is thinking about jumping into the GOP race to replace Linder. Mark is a big guy who is a populist Republican – a candidate that bring the Tea Party activists back into the fold. His email is [email protected] – i think he would be tough to beat.

  21. Personally, I would support a consumption / sales tax for one of the reasons Jeremy mentioned – bringing to light how much our government spends. However, I really don’t see why Georgia hasn’t already eliminated it’s state income tax to be more in line with Tennessee and Florida and go to a consumption / sales tax as well. Getting the tax system changed for an entire country of 300M+ is indeed going to be tough. But changing the tax system for a state with a 9M+ population shouldn’t be nearly as tough. Why haven’t our state legislators tackled this yet? They all seem to talk about being for the Fair Tax and how the national tax system should change… shouldn’t we at least look within our own state too?

    • IndyInjun says:

      A flat tax with no exemptions, deductions, or exclusions is needed. The broader the base, the lower the rate.

      A national sales tax with no exemptions, deductions, or exclusions is needed. The broader the base, the lower the rate.

      Forget the “corporations don’t pay tax” line because in the states that have no income tax, corporations pay sales tax on nearly all goods and services except materials incorporated directly into manufactured goods.

      First, CUT SPENDING with no sacred cows exempted.

      Outlaw health insurance except catastrophic and give retirees cash allowances with which to pay doctors. For those mentally incapable, there will have to be some guardianship.

      • Indy – you made many good points throughout this whole topic. I’ve certainly enjoyed reading your views and you seem to have a much better grasp than I when it comes to accounting.

        One question though – when you say flat tax, are you talking about the flat rate income tax that has been proposed? Also, are you saying have a flat tax AND a national sales tax? I would think doing away totally with the income based tax and replacing it with a consumption tax should at least cut government expenses when it comes to collecting, should it not? Focus all your efforts on collection of one type of revenue and do it well instead of collecting two different types of revenue…

        • IndyInjun says:

          By using two taxes, broadly based, the rates could really, really be low for both. The problem with the income tax is that seniors tend to pay down savings during retirement and pay no tax. (I am transitioning into this category.)

          IF we totally gut government – I believe this will happen as a total default is likely – then either will work and both may not be needed.

          IF we preserve SS and an elementary health safety net, BOTH will be needed, particularly since seniors will have to contribute, as unfair as that may be.

          Also, most FTers miss that there HAS TO BE capacity to audit. I won’t expand on that here, except to say anyone believing otherwise is deluding himself.

          • ByteMe says:

            At this point, seniors with pre-tax IRAs do indeed pay (long-term investment) income tax on the amount removed from the IRAs. If you’re almost there, talk with your accountant about how to manage the tax bite that comes from withdrawing savings in a pre-tax IRA.

          • John Konop says:

            Also it will be a collection nightmare for the federal government using teh state. What lien position are first the local taxes or the federal government when the small businessmen gets behind? Who negotiates the payment plan the federal government or the state?

      • John Konop says:

        Indy,

        I agree the key is catastrophic insurance, but you must also allow small businesses, individuals to form pools to self insure and administrate the difference. Do you realize it is illegal in Georgia for small business and individuals to form pools to help them self insure? This idea would lower healthcare cost around 20 to 25% a YEAR!

        • IndyInjun says:

          Well, they got too clever for their own good, because individuals and small businesses are coming to realize that there are so many exclusions and loopholes that the insurance company pulls out anytime you have any significant claim, that you really don’t have health insurance even if you pay $1200 a month.

          Just like people underwater are walking away from mortgages, individuals are walking away from being insured.

          The health insurers are just as crooked, unethical, and greedy as the Wall Street Banks.

          I am strongly considering it.

          • John Konop says:

            IndyInjun,

            The problem is, Georgia law does let people pool together to offset the risk. Some counties like Cherokee which have a big enough pool of employees to off set the risk have gone to self-insurance.

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