Subject: National Sales Tax endorsement Comment: President's Advisory Panel on Federal Tax Reform Dear Sir: There seems to be many reasons on both sides to agree or disagree on a NST, but a few important facts are conveniently excluded from the discussions which is a disservice to our country. As is typical, in the Washington Post on 4/12/05 a tax article did not do much to endorse the National Sales Tax alternative, NST. The writer and most all others who talk to this subject always fail to include some key critical information in the alternatives discussions. Here is your chance to be one of the first on your block to address these areas as good for a NST and the country. 1. Presently, the underground economy is estimated at $500+BILLION yearly which of course, is not taxed. This includes illegal and cash activities and the illegal drug trade. Ironically, it is the drugies who use/exploit the services and our infrastructure that they now do not pay for. With a NST, these guys will pay into the pot every time they spend and their main goal in life is to get money and spend it. 2.. Because of the now massive complex code, there are legitimate people/businesses who by error or just confusion, under report income. IRS Commissioner just estimated this at $300-400 BILLION in lost federal taxes. 3. An additional $10 BILLION budget savings/year from eliminating the IRS. IRS agents can now transfer to the DHS and catch terrorists/bad guys; better use of their time. 4. By replacing the current tax code, which costs $140+ BILLION annually to enforce, an additional savings will be gleaned. NST enforcement will be via the exiting state sale tax collection infrastructure. If you were to include these additional revenue sources from nos. 1 and 2 along with aggregate savings in nos. 3 and 4, you would agree that taxpayers in long run would pay total less taxes. Must be true intuitively, since you now have this additional chunk of money going into the federal revenue pot. Also, some give the argument [typically a major attack against a NST with only emotional value] that ' the poor low income people will suffer more', which is factually invalid since these people would be exempt and get a refund for the tax that they pay so for them it is a zero sum game. Analytically, this argument against NST has no merit. An additional view/info The Fair Tax is a terrific alternative to our current tax code. Our current Federal Tax Code has been amended so many times that it has become impossible to understand. The Federal Income Tax Code has become an abomination and it's just going to get worse! It is a complicated and unfair mess. If the present version of the Federal Tax Code came up for a vote today, it could never pass Congress and be signed into law by the President. It should have a stake driven through its heart! I dread April 15th... saving and organizing receipts, waiting on W-2's and 1099's, as well as the many hours of paperwork just to comply with the law. The anxiety of making a mistake is more than any sane American man or woman can stand! The Constitution was designed to limit the size and scope of the Federal Government. Implementing the Fair Tax would do just that. In general, many politicians will oppose any changes to the Federal Income Tax Code because it will remove their ability to manipulate people and behavior. =========really they would not appear to solve people issues and give em a free ride thereby getting people's votes==============The Fair Tax would remove their desire to pander to voters. Democrats, as well as many "moderate" Republicans, will demagogue the idea because it would make it extremely difficult to raise the tax rates and remove their ability to grow government. Fair Tax would remove all politicians' ability to payoff their friends, glean votes for re-election and punish their enemies. It would take a tremendous amount of courage and leadership to pass and implement this kind of tax reform. This is a once in a lifetime opportunity. I believe that leadership from President Bush and the Congressional Republicans, with the cooperation of some Democrats, could make this happen. This type of tax reform would minimize the power and influence that politicians have over the American people and would ensure Republican domination of government for generations. However, putting this proposal forward and making it happen will take tremendous backbone. It is about time the Republican leadership in the House and Senate begin acting like a majority party and aggressively advocate this idea. The window of opportunity is closing. The U.S. Legislature may never again have enough Republican votes to pass such a proposal. Seize this issue now and guarantee the future for all the American People. This would show the many nay Sayers once and for all the real choice... freedom from a punitive tax system! More reason to kill present system. The AMT was meant to stop the super-rich from hoarding cash in tax shelters to avoid paying taxes. But today, the tax is affecting more and more middle class Americans. Some 1.7 million paid the AMT tax in 2001; some 2.4 million are expected to pay it for the 2002 tax year, and as many as 35 million taxpayers may be subject to AMT by 2010. Tax legislation passed in 2001 has opened the floodgates, according to Allyson Hayes, at the accounting firm BDO Seidman. "The reason that more people are in the Alternative Minimum Tax is that as the regular tax rates are going down, the Alternative Minimum Tax rates are staying the same," she said. Few are aware taxes should be actually calculated under the two systems - regular tax and AMT. Taxpayers are required to pay the higher of the two. And many deductions and credits that you can use to lower your regular tax, don't apply to the AMT. "The regular tax payer, the average family of four earning $50,000 to $75,000 can very likely be subject to Alternative Minimum Tax for reasons they would never expect," The Fair Tax plan is the best Federal tax reform proposal that I've seen. I respectfully request that you get behind this plan. I would celebrate the day when April 15th becomes just another day! Thanks for everything you do. Respectfully, Ted |