
Originally Posted by
DuncanONeil
[B]"Defraud"
It is easier to defraud under the current system. It only takes on actor to accomplish such an action. Under the FairTax such would require collusion among actors. The seller and buyer at least.
Of course the seller can charge what they see fit. Even if it is a smaller amount. Tax is still due. But if they report they charged less than was paid somebody else knows. You write me a receipt for $1,000 and charge me $1,200 I know what you are doing. I have no incentive to help you.
Say a job costs $1,900 and your scammer comes in and charges $1,900 minus tax of $437, i.e. $1,463 adding 30% for a fee of $1,902. He still sends 23% to the Feds. Where is the scammers gain?
"Double tax on investment"
The FairTax repeals the income tax imposed on investment income and pension benefits or IRA withdrawals. No form of savings or investment is taxed. The beneficiaries and owners of pension funds, IRAs, and 401(k) plans
"Poker"
One thing I think you may have misunderstood. The FairTax is replacement, not reform. It replaces federal income taxes including personal, estate, gift, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes.
Those that set up the tournaments are providing a service for which they take a fee, half of the entry. 23% of that fee is due to the Feds there is no increased cost to the entrant.
"Government encourage"
That is the whole point. Where did Government get the power to decide what companies or industries should succeed? They have no right to be picking the winners in losers in commerce.
You mentioned charity. You must agree that a significant factor in charitable contribution is disposable income. The Fair Tax improves that. Charitable contributions depend on one factor more than any other: The health of the economy (not tax benefits). As a wide range of economists agree on the economic expansion the FairTax delivers, charitable contributions benefit also. With the penalty for working harder and producing more removed, Americans are free to keep every dollar they earn, and a new era of economic growth and job creation is unleashed. Hidden taxes are history, Americans are able to save more, and businesses invest more. Capital formation, the real source of job creation and innovation, is facilitated. Gross domestic product (GDP) increases by an estimated 10.5 percent in the first year alone.
As U.S. companies and individuals repatriate, on a tax-free basis, income generated overseas, huge amounts of new capital flood into the United States. With such a huge capital supply, real interest rates remain low. Additionally, other international investors will seek to invest here to avoid taxes on income in their own countries, thereby further spurring the growth of our own economy.
Real wages are 10.3 percent, 9.5 percent, and 9.2 percent higher in years 1, 10, and 25, respectively than would otherwise be the case.
(Tuerck, David G., Jonathan Haughton, Keshab Bhattarai, Phuong Viet Ngo, and Alfonso Sanchez-Penalver, “The Economic Effects of the FairTax: Results from the Beacon Hill Institute CGE Model,” The Beacon Hill Institute at Suffolk University, February 2007. )
Disposable personal income is higher than if the current tax system remains in place: 1.7 percent in year 1, 8.7 percent in year 5, and 11.8 percent in year 10.
The economy as measured by GDP is 2.4 percent higher in the first year and 11.3 percent higher by the 10th year than it would otherwise be.
(Arduin, Laffer & Moore Econometrics, “A Macroeconomic Analysis of the FairTax Proposal,” July 2006. )