National Sales Tax Promoted as Fairer System

[PhillyKev 0]

I live in one of the largest cities in the country and less than an hour from a state with no sales tax. Guess what people do when they want to make large purchases? They go down to Delaware. NST would create a huge black market that would feed criminal enterprises.

You said take a look at Russia's NST. I invite you to take a look at their black market and the growth of the Russian Mob.

[Gravitymaster 0]

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I live in one of the largest cities in the country and less than an hour from a state with no sales tax. Guess what people do when they want to make large purchases? They go down to Delaware. NST would create a huge black market that would feed criminal enterprises.

We already have that. How many "criminals" do you think are out there whose only crime is they had financial set backs and couldn't pay their taxes?

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You said take a look at Russia's NST. I invite you to take a look at their black market and the growth of the Russian Mob.

Quite a stretch. Are you contending the mob wasn't there before Russia imposed a NST? Or are you contending they are a by product of a NST? I'd really like to hear you make the connection.
There will always be crime whenever there is an opportunity to subvert an existing set of laws for financial gain

[PhillyKev 0]

I'm contending that organized crime benefits tremendously anytime a black market exists because that is who ends up controlling it.

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There will always be crime whenever there is an opportunity to subvert an existing set of laws for financial gain

But setting up a new set of laws that would encourage crime to circumvent it is not a good idea. Look at prohibition. Criminal empires were born as a result. The same thing would happen with a high NST.

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We already have that. How many "criminals" do you think are out there whose only crime is they had financial set backs and couldn't pay their taxes?

I'm not talking about tax evasion. I'm talking about violent and territorial criminal enterprises to take advantage of what would be a multi-billion dollar industry.

[billvon 3,120]

>NST would create a huge black market that would feed criminal enterprises.

I disagree; it would be no more of a problem than illegal employers not deducting taxes is today. The big change would be that now the government doesn't audit corporations to see who they have hired; they audit everyone's bank account to see who sold what to who. That would require government tracking on ALL purchases, of course, from guns to alcohol to porn to presents for the mistress.

Of course, we could trust them to keep all that confidential.

[PhillyKev 0]

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disagree; it would be no more of a problem than illegal employers not deducting taxes is today.

Bull puckey. You don't see "The big change would be that now the government doesn't audit corporations to see who they have hired; they audit everyone's bank account to see who sold what to who. " As a big problem? And you actually think that would be effective?

Fine, audit bank accounts, do you think black market operators will put their money in a bank account?

[billvon 3,120]

> And you actually think that would be effective?

It could be. Get rid of cash; that way, the government can track everyone's purchases. Of course, there will be a lot of people who won't like that the government can track every purchase, but you have to do something like this to make a sales tax based system work.

>do you think black market operators will put their money in a bank account?

If there's no cash, it makes it tougher to hide gains. Barter can work, but you can only have so many chickens.

[mnealtx 0]

Why would we need a gov't agency to monitor a national sales tax?

Price on the tag includes tax. If you have a deferment card, you show it at the register and they take the tax off on the spot, just like how tax gets added on the spot at the register now.

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[kallend 2,150]

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Why would we need a gov't agency to monitor a national sales tax?

Price on the tag includes tax. If you have a deferment card, you show it at the register and they take the tax off on the spot, just like how tax gets added on the spot at the register now.

I didn't realize that even Bush admirers could be that naive.

...

The only sure way to survive a canopy collision is not to have one.

[PhillyKev 0]

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> And you actually think that would be effective?

It could be. Get rid of cash; that way, the government can track everyone's purchases. Of course, there will be a lot of people who won't like that the government can track every purchase, but you have to do something like this to make a sales tax based system work.

>do you think black market operators will put their money in a bank account?

If there's no cash, it makes it tougher to hide gains. Barter can work, but you can only have so many chickens.

I predict a quick reversal back to the days of barter and exchange if that were attempted.

[mnealtx 0]

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Why would we need a gov't agency to monitor a national sales tax?

Price on the tag includes tax. If you have a deferment card, you show it at the register and they take the tax off on the spot, just like how tax gets added on the spot at the register now.

I didn't realize that even Bush admirers could be that naive.

And how is that naive? That's how it's supposed to work for WIC and/or food stamps now...

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[PhillyKev 0]

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Why would we need a gov't agency to monitor a national sales tax?

Price on the tag includes tax. If you have a deferment card, you show it at the register and they take the tax off on the spot, just like how tax gets added on the spot at the register now.

I didn't realize that even Bush admirers could be that naive.

And how is that naive? That's how it's supposed to work for WIC and/or food stamps now...

Ummm, maybe because your examples are overseen by a gov't agency, but you're saying it wouldn't be needed based on those examples.

[mnealtx 0]

I'm talking about the operation of it, not the oversight.

Currently, the base price of items are marked on the tag. Depending on the item and your situation, it is either a tax or a no-tax item when you take it to the register.

Under NST, I can see a few different scenarios:

1. NST added to "tag price" of items, "no tax" key hit at register if you have a "nontaxable" card, taking the NST off.

2. NST added at register just as "normal" sales tax is done now.

What agency monitors sales tax now? I would think it would be the city or state comptroller, but I'm not positive.

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[billvon 3,120]

> Why would we need a gov't agency to monitor a national sales tax?

Cause people cheat on their taxes.

>Price on the tag includes tax.

And what about you selling a rig to someone for $2000? Who's going to 'remind' you to send in the $800 in tax owed on that transaction?

>If you have a deferment card, you show it at the register and they take
> the tax off on the spot, just like how tax gets added on the spot at the
> register now.

And who polices the card? If you have a tax-deferred card, why wouldn't you rent it out for $100 a day? Need an agency to track that. Or why wouldn't you do all the shopping for all your friends? Need an agency to track _that._ And what if they made secret deposits to your bank account and then you bought everything with "your" money on "your" card? You need access to everyone's bank records to make sure that doesn't happen.

People cheat on taxes. That's why we have an IRS instead of a form that goes out that says "please just mail in what you believe you owe us." They will cheat on a sales tax, too. We still need the IRS, except now instead of tracking how much income you get from employers, they have to track how much you spend.

[mnealtx 0]

I didnt recall seeing anything about person to person sales on that webpage, nor on the fairtax.org webpage.

I do agree that people would try to cheat if they felt the tax was unfair. However, I don't see it as being as large of a problem as what you are saying.

Let's war game this out:

All new items are taxed. Used items are tax exempt. Every household gets coupons to be used on basic necessities such as food and basic clothing, based on the national poverty threshold. The coupons list the adult members of the household by name, and you would have to show some sort of ID to be able to use them. There would have to be guidelines as to what items could be bought with the vouchers/coupons, which could/would be much like the WIC/AFDC lists that you can see at grocery stores now.

You buy a new car? Pay the tax. Buy a used car from your neighbor? No tax. Buy a package of hamburger at the store? No tax. Buy a package of T-bones? Tax. Buy a DKNY shirt? Tax. Buy a "plain" shirt? No tax.

That way, people below the poverty line are effectively tax free. People above the poverty line are taxed on what they spend and / or their tastes.

Thoughts?

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[billvon 3,120]

> I didnt recall seeing anything about person to person sales on that
>webpage, nor on the fairtax.org webpage.

?? There is no way in hell any tax like that would work if you could get around it so easily! Ebay allows you to buy everything from food to clothing to electronics directly from a single other person; no one would pay any tax! (And the ones that did would pay a 200% tax to compensate.) Retail stores would go out of business. Unemployment would skyrocket.

>I do agree that people would try to cheat if they felt the tax was unfair.
> However, I don't see it as being as large of a problem as what you are
> saying.

People cheat on their taxes whether they think they are unfair or not. A friend's father went to jail a while back for helping people cheat on their taxes. He was an expert; probably saved people ten million bucks before he finally got caught. That's not because people are evil; that's because in a capitalistic system, the people who can hold on to more of their money win and end up with all the power.

>All new items are taxed. Used items are tax exempt.

How do you define new vs used? What about resellers; do they pay tax every time a radio changes hands, or only on the "final" sale?

>You buy a new car? Pay the tax. Buy a used car from your neighbor? No tax.

OK, how about a used car from the Honda dealership? No tax because it's used?

>Buy a package of hamburger at the store? No tax. Buy a package of
> T-bones? Tax.

Is that because a government official decided that hamburger was a necessity and T-bones weren't?

>Buy a DKNY shirt? Tax. Buy a "plain" shirt? No tax.

Same government official deciding which T-shirts are necessary and which aren't? Could work, except that's another government organization - "Department of Necessity Definition" or something. And it would have to be pretty well organized, because if a Sears shirt didn't make it onto the list and a Walmart shirt did, Sears is going to scream bloody murder and do everything in their (considerable) power to get it changed.

But overall that could work. Again, you'd have a fairly high tax rate (35-40% if you wanted to pay our bills, upwards of 50% if used stuff was excluded) but it could certainly be made to work.

[Kerr 0]

Just thought I'd jump in here with a quick explination of how VAT works in the UK (& euroland?).

Companies with a turnover greater than about £54k need to be registered for VAT.

All goods and services when sold by a VAT registered company have VAT added to them (17.5% in the UK), regardless of whether this is a business to business transaction or to a private individual.

When a VAT registered company pays the VAT it has collect to HMC&E it deducts all the VAT it has paid to it's suppliers.

If you are not VAT registered then you don't charge VAT on your sales and can't claim VAT back on your purchases.

There are some small businesses that will do a service job for cash, knocking 17.5% off, so there is a black market, however this is pretty small.

VAT is administered by HM Customs & Excise. Top tip, don't mess with people that have the legal authority to put on rubber gloves and ask you to spread and bend over.

Some goods are VAT exempt, e.g. childrens clothing, some kinds of food.

--
Kerr