50 votes

Gary Johnson wants a 23% national sales tax.

Gary Johnson is pushing for the so called "fair tax" which would institute a 23% national sales tax. This is something Ron has warned against over the years.

I wonder when the Libertarian party became the party of higher taxes?

I have not been a fan of Johnson, but even I was sort of surprised to hear he was pushing for a 23% national sales tax.

EDIT: For those who have requested a link. Straight from Gary's website point number 2. http://www.garyjohnson2012.com/issues/economy-and-taxes

EDIT: From Gary's website specifically referencing his support for a 23% national sales tax. http://www.garyjohnson2012.com/presidential-candidate-gary-j...




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Gary has simply...

signed on to the popular neocon plan. If he planned to balance the budget in the 1st year, why would we need a 23% sales tax going forward? I dont want to raise taxes on the rich, but Im disgusted by the constant calls to raise taxes on the rest of us, instead! That is the neocon, GOP plan! Rand Paul has even called for "broadening the base", in an attempt to socially engineer a more conservative electorate, I guess.

That's why Ron Paul is the best. He's a libertarian through and through, but he realizes that the transition would have to be done carefully, lest the super-rich could just buy up the country for pennies on the dollar during a period of reckless privatization.

Johnson is playing the game as a moderate libertarian on fiscal and foreign policy issues, while being much more socially liberal. He's certainly no RP (sigh...)

Visit https://soundcloud.com/politics-of-freedom for all recent Ron Paul interviews, speeches, debates, forums, panels, press conferences, news coverage, and Texas Straight Talk updates!

"Terrorism is the war of the poor, while war is the terrorism of

I agree

just because I don't want to soak the rich doesn't mean that I want to pay higher taxes. Then people will say "oh but you benefit from government services that the taxes pay for." That's the thing, we DON'T benefit from government. I mean which government 'services' do I benefit from: the war on drugs? The wars of conquest in the Middle East that are unjustified? Subsidies for unprofitable companies? Any services that we do benefit from are likely only a tiny portion of the overall budget and thus we don't need high taxes to pay for them. And the only reason why we benefit from things like roads is because we need to use them and the government forcefully claimed ownership of them in the first place. So libertarians should not be signing on to higher taxes for anyone in my opinion.

a good read

about the realities of the "fair" tax
(considering there is a fair amount of pro tax propaganda on this thread)

the easiest way to get something done isnt to change the behavior; its to change the meaning of existing behavior. like a cut isnt a cut, torture isnt torture, its enhanced interrogation. war isnt war, its kinetic military action. declaring war now appare

And I do feel that if the

And I do feel that if the fair tax would really be a boon for business, then they would have gone ahead and enacted it. Let us be serious, big business controls Congress. That is why they've whittled down the corporate tax rate to nothing. If they preferred teh fair tax, they'd get it done.

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

Congress and their Cronies don't want the FairTax

They won't pass it, because it eliminates the roll of corporate lobbyists and special favors for tax breaks. In other words, tax-related power and corruption in Congress would vanish, and the collusion between corporations and the government (aka Crony-Capitalism) would diminish.

Congress wants big corporations to continue lobbying for tax breaks, and big corporations want to continue lobbying for tax breaks that their smaller competition can't get.

Well, they'd just get

Well, they'd just get exemptions for the stuff that they buy. Correct me if I am wrong, but the fair tax only hurts a business in terms of its final product. Along the way, everything it purchases its tax free. If not, they'd just pass exemptions in Congress.

I think that businesses fear that if consumers have to ackowledge the cost of things upfront, they would be hesitant to buy it. That TV now costs 23% more...it works better if you buy the TV and the government just takes 23% out of your paycheck that you aren't noticing all at once.

You've done a good job convincing me, though. I still think I'd prefer a Singaporean/Hong Kong like system with tough regulation, and progressive flat taxes...your income is taxed at a certain rate, no exceptions.

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

Isn't hard to defend a tax

on human labor?

No Exceptions

There are no exceptions in the FairTax, not even food or clothing can be exempted. The only taxes that can be excluded come from the prebate, which each person benefits from equally. They understand that as soon as you allow one exception, even as seemingly palpable as one for food, the system is open to exploitation.

Cheers!

Another question for you.

Another question for you. Looking at the fair tax website, it looks like certian business equipment is still taxed. After all, if it weren't, then it would be an exception.

When you have a sales tax, you are increasing the cost of doing business, because when you spend money, you have to spend more to pay for that tax. You increase the risk, because now an individual has to spend more on equipment, facilities, etc.

When you have a a tax on profit, the cost of business stays the same. Yes, you may have less money to play with if you make money, but ultimately your risk stays the same...you only pay the tax if you make money.

I would wager that the vast majority of entrepreneurs would rather pay a tax of 30% of their profits rather than on (let us say) 10% on their operating costs.

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

Business under FairTax

Sorry, I should have been more clear...

Under the FairTax, nothing can be taxed more than once. As such, goods are only taxed at the point of consumption by consumers. Businesses pay no sales tax when buying materials and equipment from other businesses.

For example, a baker selling bread would pay no taxes when he buys wheat and flour, as well as the oven for baking it. Furthermore, if a deli buys his bread for making sandwiches, they pay no sales tax on the bread. The only point at which sales tax comes into play is when the baker sells his bread to customers, and when the deli sells sandwiches to their customers.

In other words, under the FairTax, the government can't tax flour when the baker buys it, and then tax that flour again when he sells it as bread.

@"Looking at the fair tax website, it looks like certian business equipment is still taxed."

That is not true, what page did you read this? Business equipment is only taxed if it's converted to personal property.

How in the world would you keep track of all that?

So if I buy flour in the store to bake at home, I pay sales tax, but if a baker buys the flour from a distributor, he doesn't pay sales tax on the flour? How do you define a distributor vs. a retail point-of-sale? Whatever definition you come up with, people are going to figure out a way to define themselves as distributors, so they can attract customers that don't pay sales tax. This would seem to be especially likely for any online sales.

I can't believe people on this site are defending the fair tax. The co-option has begun. Thanks, Rand and GJ.

“With laws shall our land be built up, but with lawlessness laid waste.”
-Njal Thorgeirsson

Isn't that an exception

Isn't that an exception though? Inherently, it seems to be one.

Wouldn't it be unfair that if I buy wheat to make bread to eat, I have to pay a tax on it, but if a restaurant buys wheat to make bread to sell, it doesn't have to pay taxes on it? How would you determine what is "point of sale/consumption" and what isn't? Wouldn't noncompliane be huge?

What if a company buys excess materials and never produces anything from it? Should they be retroactively taxed?

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

Its actually 30%

its 23% of the product+tax. for example
i pay $130 for something, im actually paying $100 for the product, and $30 in tax. thats 30%
BUT, since its "tax inclusive" $30 is only 23% of $130

its tricky word play, nothing more.

the easiest way to get something done isnt to change the behavior; its to change the meaning of existing behavior. like a cut isnt a cut, torture isnt torture, its enhanced interrogation. war isnt war, its kinetic military action. declaring war now appare

FairTax > Income Tax

I know a national sales tax sounds scary at first, but the FairTax is MUCH better than any Income Tax in every possible way, including the "Flat" Income Tax. Do your research before dismissing it.

Even Ron Paul said a national sales tax would be much better than an income tax. What Ron Paul has warned against is a national sales tax in ADDITION to an income tax.

Keep in mind, the "prebate" means nobody pays sales tax on your first ~$11k+ of annual purchases per person, so it doesn't hurt the poor. Also consider that companies would no longer have to embed corporate/income taxes into the price of their products, so prices would go DOWN about 19% before adding in the 23%. All the while you're keeping your ENTIRE paycheck. It would also mean business in the U.S. would become competitive on the global market again and JOBS WOULD COME BACK TO THE U.S. from overseas, because it eliminates cascading and double taxation.

p.s. I'm not a Johnson supporter. Ron Paul is my president.

How is it necessarily better?

What if the income tax was 1% and the 'fair tax' was 50%, would the fair tax still be better?

a sales tax is definitely a much better way to tax, but...

the fairtax plan is pure garbage. Ron said 2 or 3% as a REPLACEMENT to income tax. the fairtax is 30% (not 23%; its a trick to give them a 7% buffer) and meant to provide them with a similar level of TR so they can continue the spending orgy at a greater cost to lower and middle income economic participants than currently is.

the easiest way to get something done isnt to change the behavior; its to change the meaning of existing behavior. like a cut isnt a cut, torture isnt torture, its enhanced interrogation. war isnt war, its kinetic military action. declaring war now appare

A 2% tax rate is definitely

A 2% tax rate is definitely better than 23%, I can't argue with that. Maybe some day we'll get there, but I'm not going to hold my breath.

Even at 23% (tax inclusive) or 30% (tax exclusive), the FairTax is a massive improvement over any income tax, including the "flat" income tax. See my "FairTax Examples" post below.

The major difference is that WE CAN CHOOSE WHEN to pay taxes. Each one of use could BOYCOTT paying taxes by limiting our spending to under $11k on NEW items per year, and still spend as much as we want on used items.

The FairTax puts the power back in our hands until the day we can reduce government spending and taxing.

Garbage? I think not. See my post "FairTax Benefits" below as well.

now you are playing the

"better than the other guy" card. better than the income tax? maybe, on some level slightly. good? absolutely not. it will not do anything to stop the spending orgy.

the easiest way to get something done isnt to change the behavior; its to change the meaning of existing behavior. like a cut isnt a cut, torture isnt torture, its enhanced interrogation. war isnt war, its kinetic military action. declaring war now appare

and i saw your other posts.

its all blah, blah, blah minutia meant to distract from the fact that: #1 its actually 30% and
#2 its designed to provide the government with a similar level of money to continue the spending.

the easiest way to get something done isnt to change the behavior; its to change the meaning of existing behavior. like a cut isnt a cut, torture isnt torture, its enhanced interrogation. war isnt war, its kinetic military action. declaring war now appare

Tax Reform is not Spending Reform

You want to reduce government spending, and I'm with you, but that's a separate battle. A battle that involves the Federal Reserve.

I'm fighting with you for drastic spending cuts and ZERO taxes. Unfortunately, that may be a fight that my children will have to finish (our oldest is 4-years old).

Until we reduce spending enough that the government doesn't need any taxes, we need a new simple tax system that can scale down easily as spending comes down. By simple, I mean individuals don't have to worry about filing tax returns, etc.

Your too focused on the tax RATE. I'm focused on the tax SYSTEM, and how everyone paying taxes today would PAY LESS taxes under the FairTax. I'm aware the current amount of "embedded" tax is ambiguous, that's why I completely left out any additional savings from it in my "FairTax Examples" (posted below) - to be conservative in my estimates.

p.s. I read the article by Laurence that you posted above, and just like you, he focuses on the tax rate without considering any of the benefits. He completely fails to mention the prebate, among other things. It's quite clear that his view is: We must go STRAIGHT to ZERO taxes!!! Oddly enough, he's the only one I can find writing against the FairTax (out of hundreds of authors on the same website).

i believe that is called

compartmentalization.

the easiest way to get something done isnt to change the behavior; its to change the meaning of existing behavior. like a cut isnt a cut, torture isnt torture, its enhanced interrogation. war isnt war, its kinetic military action. declaring war now appare

Wrong

We should wait for government to reduce spending before eliminating taxes?

Wrong. Eliminate the taxes leaving the government one less avenue.

If I learned anything from Ron Paul,

it is that cutting taxes doesn't mean sh*t if you are not cutting spending. The government will just suck it out of you through inflation.

“With laws shall our land be built up, but with lawlessness laid waste.”
-Njal Thorgeirsson

thats the thing though

its not a tax cut. it is revenue neutral.

the easiest way to get something done isnt to change the behavior; its to change the meaning of existing behavior. like a cut isnt a cut, torture isnt torture, its enhanced interrogation. war isnt war, its kinetic military action. declaring war now appare

I read somewhere...

I read somewhere(I think it was the actual fair tax website) that in order to offset the imbalance between poor and wealthy there is what is called the "prebate" where every month, depending on how much you make, you get a check from the government to offset the taxes you would have to pay that month. I'm not really sure how it works, can anybody explain the idea behind the "prebate?"

Prebate

The prebate is not a check or free money for people to spend. Basically, the prebate is just a mechanism that prevents people from having to pay sales tax for the first ~$11k that they spend on NEW products per person per year. It would act like a debt card that pretends to pay the sales tax for you until you reach your limit. USED products are never taxed (i.e. homes, cars, etc.)

I hope that helps, cheers!

And it's administered exactly

And it's administered exactly like welfare. Every person becomes a welfare recipient of the federal government. And, by the way, the federal government will then know all about our purchases. Not to mention every small business becomes a federal tax collector for Uncle Sam.

I hate the IRS. But the current system of filling out my forms and mailing a check once a year sounds far more appealing.

Ron Paul 2012 - It's Almost Here!

The three plans I keep

The three plans I keep hearing are these:

Fair tax
Ron Paul's excise tax plan
Ron Paul's excise and corporate tax

The first plan isn't really fair. If you start taxing the lower-middle class and middle class so much, and don't tax capital expenditures, you drain the purchasing power of the economy. Moreover, you will get civilian revolt. The unfortuante fact is, that someone making 50,000/year needs that 10,000 a lot more than someone making 10 million a year needs 2 million (and with a fair tax, he'd likely be paying much less as a % of his salary).

Fundamentally, the richest in the country have the most to gain from a (proper) government. Because when there is no government to protect life, liberty, and property, it is the rich that the common people will drag on to the streets and take revenge upon (see the French revolution).

Ron Paul's no-tax plan is also ridiculous. Ron Paul constantly says that the federal government during the era of the founders existed with just an excise tax. However, from 1792 to 1910, you saw excise tax rates that would generate several times more than what our current government generates. For example, using rates from 1792, 1820, and 1900, we would collect 600 billion, 1.1 trillion, and 700 billion in income tax; those are fairly similar to income tax levels today. Moreover, military spending alone for those three times today would equal to 98, 322, and 350 billion today. Ron Paul himself has admitted that military spending needs to be at least 500-700 billion.

When you add in the corporate tax, it does help make up the difference. However, corporate effective tax rates are at all time lows, and are only going lower. In any case, it in total does not add up to enough to fund sufficient government.

Plan for eliminating the national debt in 10-20 years:

Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...

Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a

FairTax Benefits

You're misunderstanding the FairTax.

Any concerns about burdening the poor and middle class, and adding taxes to essential goods (e.g. food, clothing, health care) are negated by the FairTax prebate, which compensates everyone for taxes up to the poverty level. Actually, as unseen embedded taxes (from existing corporate taxes) are revoked, new goods purchased under the FairTax prebate will likely cost 19% less (on average) than they do today.

For example, a new product that costs $95 today could cost only $77 under the FairTax prebate and $100 thereafter.

All valid Social Security cardholders receive a monthly prebate that prevents anyone from having to pay taxes on new goods under the poverty level.  According to the current poverty level, each individual could purchase $10,830 of new goods per year tax free.  For couples, that allowance is $21,660 per year.  The allowances go up roughly $3800 for each child.

Remember, USED goods are always tax free (i.e. homes, cars, etc).

PROS
- You get your entire paycheck, pension or Social Security check.
Without income taxes, you could save or pay off debts much faster.
- You choose how much (if any) tax you pay... by increasing or decreasing your spending on new goods and services beyond the prebate.
- Eliminates annual tax returns.
No more tax day - April 15th is just another spring day.
- Eliminates all income-based Federal taxation.
Imagine it... No Federal income tax (including personal, estate and gift tax,) no Medicare tax, no Social Security tax, no capital gains tax, no corporate tax (including all payroll taxes,) and no alternative minimum tax.
- Eliminates the IRS (Internal Revenue Service.)
The IRS employs more investigative agents than the FBI and the CIA combined.
- Eliminates the convoluted Federal income tax code, and closes all tax loopholes.
The tax code began in 1913 with 14 pages but is now over 70,000 pages.
- Eliminates the roll of corporate lobbyists and special favors for tax breaks.
As a result, tax-related corruption and power in Congress vanishes, and the collusion between corporations and the government (aka Crony-Capitalism) diminishes.
- Products built in America will be far more competitive on the global market.
- Will likely trigger an economic boom in the U.S.
Businesses and jobs would flock to the U.S. to take advantage of zero corporate taxes.
- Will likely reduce or eliminate hidden taxes on the poor.

- Low income families and individuals will continue to pay no taxes.
In fact, anyone who spends less than the poverty level pays no taxes, no matter what their income.
- Those who currently avoid income tax (i.e. drug dealers, pimps and prostitutes - or anyone paid under-the-table) will have to pay taxes on new products and services beyond the prebate, just like everyone else.
- Those who currently pay income tax will pay less tax, due to the increased tax base.
More people will be paying taxes than before, including 40 million tourists each year.
- Saves individuals and businesses from having to pay for tax return preparation.
In 2005 individuals, businesses, and non-profits spent an estimated 6 billion hours complying with the federal income tax code at an estimated cost of over $265 billion. By 2015 compliance costs could grow to over $480 billion.
- Implementation of this new tax system will be easier than one might assume.
45 of the 50 states already have a similar sales tax in place, and the states can foster administration and collection of a new national sales tax with relatively minimal additional effort.

FairTax Examples

A family of four has a prebate allowance of $29,140 per year.  These examples assume all spending is on NEW stuff - you can by as much USED stuff as you want with no taxes.

Family of four that makes $29,000 per year or less and...
- spends less than $29,140 would pay NO TAXES. 

Family of four that makes $50,000 per year and...
- spends less than $29,140 would also pay NO TAXES. 
- spends $29,000 on NEW items and $21,000 on USED items would pay NO TAXES.
- spends all $50,000 (on NEW items) would pay $4797.80 in taxes (or 9.6% of their income.)

Family of four that makes $100,000 per year and...
- spends less than $29,140 would also pay NO TAXES. 
- spends $50,000 would pay $4797.80 in taxes (or 4.8% of their income.)
- spends all $100,000 would pay $16,297.80 in taxes (or 16.3% of their income.)

Family of four that makes $1,000,000 per year and...
- spends less than $29,140 would also pay NO TAXES. 
- spends $100,000 would pay $16,297.80 in taxes (or 1.6% of their income.)
- spends all $1,000,000 would pay $223,297.80 in taxes (or 22% of their income.)

Retired grandmother with no income and...
- spends less than $10,830 per year also pays NO TAXES.

Compare those to the tax rate you pay now. Remember, all USED goods are always tax-free.