In order to turn our economy around we must implement a system for taxation that makes sense and is fair for all. We know the current one is neither. Today, depending on the source quoted, roughly 49% of the population pays no federal tax at all. The critical question is, “What happens when that number rises to 51% or higher?” The answer is inescapably a math exercise, pure and simple; the minority of the population will be supporting and paying for the majority. So, if the majority are voters, who will they choose to represent them? Again, purely and simply; those who are giving them something for nothing!
It is easy to see that liberals will continue to demand the rich ‘pay their fair share’ and more; that the ‘evil’ corporations be taxed on their profits at increasingly higher percentages. Never mind the undeniable fact that corporations do not pay taxes! They simply raise their prices to the consumers (us!) who are, in reality, passing our money from the corporation or entity from which we are buying, on to the Federal Government. Again, simple logic.
Tax reform is critical to the creation of jobs. The current system, as run by the IRS, creates disincentive to companies to create jobs. A consumption-based tax, rather than income-based tax, would be a far better system for the U.S to adopt. We keep hearing talk about a flat tax being the answer. In truth, that will change nothing. In fact, that the current tax began as a flat tax! Nothing will prevent any new flat tax from increasing over time.
Tax reform will create jobs. It will allow businesses to hire now and not have to worry about what they will face down the road.
Tax reform will bring corporations back home from overseas. Any corporation would relish the idea of not having to collect taxes for the Federal government.
Rather than stifling the economy as it is doing now, tax reform will increase consumption.
The answer is the Fair Tax Bill (H.R.25 and S.13) now waiting for passage in Congress. By eliminating the IRS and its 79,000 pages of code, and changing from an income-based tax to a consumption-based tax, we all would be paying our fair share by the choices we make in our purchasing decisions. We would each be in control of the amount of tax we pay and everyone would be paying something. There are many excellent reasons for this bill to be enacted.
The Fair Tax:
- Enables workers to keep their entire paychecks
- Enables retirees to keep their entire pension checks
- Refunds in advance the tax on purchases of basic necessities
- Allows American products to compete fairly
- Brings transparency and accountability to tax policy
- Ensures Social Security and Medicare funding
- Closes all loopholes and brings fairness to taxation
- Abolishes the IRS
You have noticed that I link Tax Reform directly to Job Creation. The current tax situation is one of the greatest job-killers we face.
Please feel free to contact me with any questions you may have about any of these issues.