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Personal services such as health care, legal services, financial services, and auto repairs would be subject to the FairTax, as would renting apartments and other real property.[4]
I have accomplished considerable profit and wealth for my employers and landlords.
My friend's dad is from Albania; he came here with no degree or contacts and started a restaurant in MI. He isn't rich and currently works for someone else, but he has a house and sent 2 kids to college, one to become a black belt in martial arts, and another to cosmetology school. He is currently trying to help his son start his own martial art studio.
Low taxes on the rich - where will the govt. get its money from to pay for defense, infrastructure, police, courts, schools, health etc....?
From the people who benefit from all of the above... essentially... EVERYONE, instead of the only 49% who pay federal income tax now.
And it wouldn't be low taxes on the rich. 15.3% of $500,000 is $76,500. The same tax rate for an income of $50,000 is $7,650. Is it really that hard for you to understand that $76,500 is MUCH more than $7,650 though both earners would be paying for the exact same access to the exact same government benefits and services?
so where does the tax revenue come from in periods of high unemployment?
Whoever is still working and subject to paying federal income tax. Unemployment isn't the only concern, though. Because of the recession, tax revenue from the higher income earners (they're most likely to be subject to paying federal income tax) declined quite a bit as their incomes declined.
Source: U.S. Treasury’s Monthly Treasury Statement
More on that from a comment I posted last August:
Quote:
Originally Posted by InformedConsent
AND when the people at the top started losing money, the federal government lost a disproportionate amount of tax revenue, MUCH MORE of a loss than the people at the top had. Why? Because the federal government is overly reliant on higher income groups for tax revenue.
That SIGNIFICANTLY increases deficit spending in a recession or economic slowdown, which in turn cranks up the National Debt. The National Debt is at $16 Trillion now because of the over-reliance on only a few for tax revenue and the consequent deficit spending that ensues when the economy is sluggish. Pi** poor economic policy, but there you have it.
When nearly 40% of the federal income tax revenue is paid by a group whose share of the income declines (which it has, by 7% so far), the result is MORE than a minor decline in tax revenue (which is exactly what happened).
That illustrates why a flat tax is a much more fiscally sound taxing policy. It's immune to shifts in income share.
In addition, a flat tax ensures everyone pays their fair share according to their level of income: Earn very little; pay very little. Earn A LOT; pay A LOT.
That 7% decline in income share yielded a 25% decline in income tax revenue.
NOW do you all understand why it's extremely poor policy to be over-reliant on any one group for a significant portion of tax revenue?
Last edited by InformedConsent; 02-25-2013 at 12:12 AM..
Whoever is still working and subject to paying federal income tax. Unemployment isn't the only concern, though. Because of the recession, tax revenue from the higher income earners (they're most likely to be subject to paying federal income tax) declined quite a bit as their incomes declined.
Thank you for illustrating that underpaid burger flippers working for top-bracket small business owners are actually contributing more in taxes than if the burger flippers were paid higher wages.
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