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Seashore · 05-23-2009, 10:28 PM

Here is a consolidation and paraphrase of the two posts so far on a flat sales tax:

Currently all monies that we pay to the IRS in the form of income taxes goes directly to the Federal Reserve to pay the INTEREST on the money that the government borrows from them. That is why we as a nation constantly have an increasing deficit. We are never paying down the PRINCIPAL on that loan from the Fed, only the interest. Which is why we always need more money and they have to constantly raise taxes. It is also the cause of inflation because the more we borrow, the less the dollar is worth, and the higher the price of goods go, the higher wages go, and so on. It's quite a vicious cycle.

We need to eliminate both the Fed and federal income taxes. To raise revenue, we could establish a flat sales tax in every state on goods and services.

A decision would have to be made concerning the necessities of life (food, medicine, clothing). We could:

a. Exclude them
b. Tax them at a low rate: for example 1% going to the state and 1% going to the federal government

General goods and services would have a higher tax with say 4% going to the state and another 3% going to the federal government.

Luxury items like cars and homes over a certain price, and other luxury items would have a higher tax on them.

The advantage of not taxing income and taxing goods and services instead is that people have incentive to work hard and make a lot of money, but are discouraged from spending excessively for unnecessary items.

Another advantage is that there would be no earmarking of funds that you and I pay to the federal government for projects in some other state that we care less about.

There should be no flat sales tax on items that have an existing tax already.

Some provision needs to be made so that there is no increase in the tax rates without justification.

05-23-2009, 10:28 PM	#33
Seashore Avalon Senior Member Join Date: Nov 2008 Posts: 3,564	Re: To Do List Here is a consolidation and paraphrase of the two posts so far on a flat sales tax: Currently all monies that we pay to the IRS in the form of income taxes goes directly to the Federal Reserve to pay the INTEREST on the money that the government borrows from them. That is why we as a nation constantly have an increasing deficit. We are never paying down the PRINCIPAL on that loan from the Fed, only the interest. Which is why we always need more money and they have to constantly raise taxes. It is also the cause of inflation because the more we borrow, the less the dollar is worth, and the higher the price of goods go, the higher wages go, and so on. It's quite a vicious cycle. We need to eliminate both the Fed and federal income taxes. To raise revenue, we could establish a flat sales tax in every state on goods and services. A decision would have to be made concerning the necessities of life (food, medicine, clothing). We could: a. Exclude them b. Tax them at a low rate: for example 1% going to the state and 1% going to the federal government General goods and services would have a higher tax with say 4% going to the state and another 3% going to the federal government. Luxury items like cars and homes over a certain price, and other luxury items would have a higher tax on them. The advantage of not taxing income and taxing goods and services instead is that people have incentive to work hard and make a lot of money, but are discouraged from spending excessively for unnecessary items. Another advantage is that there would be no earmarking of funds that you and I pay to the federal government for projects in some other state that we care less about. There should be no flat sales tax on items that have an existing tax already. Some provision needs to be made so that there is no increase in the tax rates without justification.