August 02, 2004

A Fair Tax At Last?

Geek With A .45 has what could be some very good news.

The gist is that Speaker of the House Hastert seems to be a proponent of scrapping the national income theft progressive income tax system. This would, for all practical purposes, eliminate the IRSS as we know it. Geek got his info from Drudge.

Drudge's sources claim Hastert will push for "...a national sales tax or a value added tax..." sometime in the next term. I assume by a sales tax he's referring to the Fairtax plan generally & specifically H.R. 25 & its companion bill S. 1493. More or less it would replace the current progressive income tax with a national sales tax.

I won't say Fairtax is a perfect plan. I'm not crazy about the rate of 23% as I think the federal government could do all the things its supposed to do with a 2% rate. But 23% of what I purchase is much different than 23% of what I make. It would encourage saving by individuals. Also it would stimulate the economy as the hidden costs of the progressive tax wouldn't be reflected in consumer prices. You think that an employer doesn't figure in his taxes when setting the price for a product? (Hint: corporations do not pay taxes; they adjust the prices of their good & services to cover those taxes. In effect we pay them.) Most importantly it would take away any justification for the government to know how much money I make (or don't) per year. No more IRSS agents looking all giddy when they whip out the word "audit", no more filing of constitutionally questionable forms by mid-April.

The problem however lies in the industry built up around the income tax. You think H&R Block will take this sitting down? You think tax attorneys will just quietly pursue their dreams of being carpenters & plumbers? Expect a big fight. Don't be surprised at an intense media campaign to inform the people about how evil a national sales tax would be & why a progressive income tax is the best way to go. Then enter the Dems who are pressured by the lobbyists of the national income theft money launderers’ association tax industry. They'll be shortly followed by the Repubs who feel the same pressure.

Fairtax is overall a worthy plan, if for no other reason than whittling down Title 26 of the U.S. Code to something legible. It's not perfect but it would be a drastic improvement over the current protection racket income tax system.

One thing that bothers me is that if Drudge has Hastert's intentions correct, then why the hell is he waiting until after the next election to push for it? I'm automatically suspicious of any politician who's in office & promises to do something after the election that he could do before the election. They're not a trustworthy lot to begin with & this does little for their credibility.

It very well could be that Hastert is hoping the next election will bring a stronger hold on Congress by the GOP & thus make passing such a bill easier. Although I don't think it wil receive wide support by either party once the theft tax industry gets mobile.

Or it could be that Hastert wants these rumors to float around in the hopes it will increase GOP supporters at the polls this year, but has no intention of letting it pass. After all, don't some claim that Bush publicly supports the "assault weapons" ban being renewed but privately the GOP works to make sure it never gets voted on? The same tactic could be at work here (& no, I don't think that's the reason behind Bush's support of the "assault weapons" ban - but that's another subject).

At this point it's too early too tell anything; even if Drudge's info is accurate. Still, it'd be a damned nice thing to have happen, especially before the election. If the AWB sunsets & the Fairtax bill becomes law then I & possibly a lot of other libertarians (both big & small "L") would probably vote republican out of gratitude.

As it stands now the only thing certain is that Rep. Ron Paul would finally get a chance to vote "yes" on something if the Fairtax bill were hit the House floor.

Posted by Publicola at August 2, 2004 06:13 AM

I'd love to see it happen, unfortunately I don't think it ever will. Too many people think that the solution to everything is "tax the rich".

Posted by: dave at August 2, 2004 09:47 AM

"I'm not crazy about the rate of 23% as I think the federal government could do all the things its supposed to do with a 2% rate"

Seriously Publicola, two whole percents? i would never have expected you to estimate such a high number. ; )

Posted by: annika at August 5, 2004 09:57 PM
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