Abolish the IRS?....hmmm......
What an interesting concept. Proponents are proposing a national sales tax to take the place of income tax - no more April 15, no more deductions from my paycheck. My knee jerk reaction was YIPPEE (although it would also mean no more tax refunds)! Then I kept reading...
Estimates for the percentage for this tax range from 23% to 60%. That's on top of the state and local taxes. The concept is that the poor ($9310 for singles, $18850 for a family of four) would be tax-free - in the form of "pre-bates". Doesn't this create a new government entity to take the place of the IRS? Now we need someone to administer the prebate program.
The estimated amount just floors me. I can't help but believe our economy would tank. Granted, I have a four children so I have less taken out of my check that a single person, but pulease! They would not recoup near enough to offset an additional 50% on all spending. Can you imagine shopping for a car? Sticker price is $20,000. Oh yeah - don't forget about the new sales tax. That car is now priced at $30,000 + state taxes and ttl.
Consumer spending is the bellwether for the state of the economy. I know that personally my consumer spending would decrease dramatically - especially on big ticket items. What would happen to the US dollar in the world market?
I'm not an economist - hell, I don't even play one on TV - but this feels wrong. Maybe they have crunched their numbers and it would be a good thing for the country as a whole. All I can do is crunch my own personal numbers and for my family this would suck!
Estimates for the percentage for this tax range from 23% to 60%. That's on top of the state and local taxes. The concept is that the poor ($9310 for singles, $18850 for a family of four) would be tax-free - in the form of "pre-bates". Doesn't this create a new government entity to take the place of the IRS? Now we need someone to administer the prebate program.
The estimated amount just floors me. I can't help but believe our economy would tank. Granted, I have a four children so I have less taken out of my check that a single person, but pulease! They would not recoup near enough to offset an additional 50% on all spending. Can you imagine shopping for a car? Sticker price is $20,000. Oh yeah - don't forget about the new sales tax. That car is now priced at $30,000 + state taxes and ttl.
Consumer spending is the bellwether for the state of the economy. I know that personally my consumer spending would decrease dramatically - especially on big ticket items. What would happen to the US dollar in the world market?
I'm not an economist - hell, I don't even play one on TV - but this feels wrong. Maybe they have crunched their numbers and it would be a good thing for the country as a whole. All I can do is crunch my own personal numbers and for my family this would suck!
1 Comments:
If they went to something like a flat 6 or 7% across the board on all purchases including payroll, that would work and work well. The only reason that I know this is because I married into a family of bankers and accountants.
Dick
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