Comment: To the Tax Reform Panel, I, along with 80-90% of my fellow Americans, want the Fair Tax, HR 25 as a replacement for our current tax system. Sincerely Yours, John Paul McDaniel 4932 Oak Bluff Mesquite, Texas 75150-3193 972-226-5798 50 Reasons I Support the FairTax (How many reasons can you give for supporting the present obsolete IRS & income tax system?) Those Who Know the Facts Love the Fair Tax "Family Friendly Tax Reform" Tax Reform with far less pain and much more gain! Out with the Old Code and in with the New 1. It allows you to keep 100% of your paycheck, with nothing withheld for Social Security and Medicare payments. 2. It eliminates the regressive payroll tax that hurts the poor. Currently, every one of us is taxed a minimum of 7.65% on our first-dollar of wages up to $90,000, if we earn that much. 3. It assures that the wealthiest Americans will be voluntarily helping to fund social security with every last dollar they spend above the poverty level. Today, earnings are subject to payroll taxes only up to $90,00 0. The wealthiest Americans therefore do not pay into the system above that amount. If their earnings are from investments, no earnings fund the Social Security system. Under the FairTax, a single purchase (regardless of the source of the earnings) can result in greater contributions to the Social Security system than would be paid by an individual under the payroll tax of today. 4. It provides funding for Social Security and Medicare at a level equal to or greater than at present, with a stronger and broader tax base. 5. It secures the future of Social Security and Medicare because all spenders fund it and not just the workers. 6. It eliminates all personal income taxes, payroll taxes, corporate income taxes, gift taxes, death taxes, and capital gains taxes. 7. It eliminates the income tax and the IRS. Members of Congress and the public overwhelmingly agree that the current internal revenue code is cumbersome, intrusive, coercive, and inefficient. 8. It is reve nue neutral with the present income tax system, funding the federal budget at current levels. 9. It will remove an average of 22% of the cost of American made goods by removing the built-in payroll tax (the other 7.65% of earnings that employers pay) and other business taxes that are now passed to consumers as an "embedded" tax of approximately 22% due to the cascading of income and payroll taxes paid by U.S. employers, at every step of production, to the U.S. Treasury. 10. It doesn't tax used items - clothes, cars, homes. Only new items are taxed when sold by a business to an individual. 11. It is progressive, a "prebate" of the tax amount up to the poverty level is given to everyone. This means that those spending below the poverty level have a net gain because the "prebate" exceeds the amount paid in taxes. (Under the present system they pay the payroll tax even if they get a full refund of income tax withheld.) 12. It eliminates 90% of the cost of complia nce. American families and American businesses waste an estimated $250 - $600 billion per year doing the paperwork necessary to comply with the tax code. That is roughly $1,000 - $2,000 annually for every man, woman and child in the U.S. 13. It creates an opportunity for our products to leave this country costing an average of 25% less, thus increasing our exports, lower our deficit balance of trade, and increasing employment at home. 14. It encourages investment in companies located in the U.S., thus providing a home for money already in the US and attracting more. The U.S. will be the most attractive tax-free haven in the world for doing business. American companies will return from offshore and overseas. 15. It encourages repatriation to the U.S. of money held by U.S. individuals and companies now in foreign countries, with no tax consequence. 16. All 290 million Americans and 51 million visiting tourists fund Social Security and Medicare with their purchases. Today only 110 million workers fund these programs via deductions from their paychecks. 17. The broader tax base includes the ten percent of our economy, an estimated $1 trillion, that today is underground or under the table. Under the FairTax, the illegal drug dealer will pay his tax just like the rest of us when he buys his sunglasses, BMW, and other items, as will those who do business for cash. 18. It allows families to save more for home ownership, education, and retirement. An average family making $50,000 will have $7,500 more spendable income. 19. It makes educational tuition a tax-free expenditure of tax-free income. 20. It makes American products more competitive overseas by removing the embedded tax from them, thus lowering their prices, which compensates for low foreign wages. 21. It makes American products more competitive at home by removing the embedded tax from them, compensating for the low cost of imported products not burdened by taxes impose d by exporting countries. 22. It removes the need for formal 401-K's, IRAs, HSA, etc. Anyone will be able to set up any kind of savings or investment account without regard to taxes or the government. 23. It frees churches and other non-profit organizations from the expense of filing tax returns and paying their half of Social Security and Medicare payments for employees. There will no longer be any 501.c.3 or 501.c.4 non-profit tax status, because there will be no more tax to be exempt from. 24. It restores to churches and non-profit organizations the 1st Amendment right to engage in free speech, without fear of losing their tax-free status. 25. It gives individuals and businesses the right to donate as much as they want to in a given year to charitable causes. 26. It restores the 4th Amendment, protecting against unreasonable searches and seizures, from which the IRS presently is exempt. 27. It restores the 5th Amendment, which guarantees the right to du e process. Under current systems the IRS has their own courts with their own set of rules not included in the 5th. 28. It cleans up a major flaw in campaign financing, eliminating campaign donations for "tax favors". 29. It eliminates wrangling in Congress over tax cuts, the tax code, and who is or is not paying a fair share of the tax bill. 30. It encourages work by letting workers keep 100% of their earnings and giving a rebate, to boot, making the notion that the more you work, the more money you have, a reality, unlike the current system where welfare is lost when you go to work, so your first dollars earned after taxes just offset what you were currently getting in welfare, making you no better off. 31. It allows more of the lower income families to become home owners by allowing a second job income above their current income (all tax free) to be applied to a mortgage. Money for down payments for homes is also saved totally tax free so that it will accumul ate faster. 32. It allows families to retain farms and businesses in the hands of those who built them through the elimination of the death tax. 33. It allows families to help each other out tax-free, by eliminating the gift tax. 34. It encourages individuals to self-insure, making the health system more direct pay (no 3rd party pay), thus bringing costs down. 35. Without FICA to pay, most states, counties, municipalities, and school districts will see a large increase in their state budget revenues, additionally lowering the overall tax burden (State & Federal) for most Americans. 36. It assures that no American will find, at the end of the year, a need to get a loan to pay taxes as an alternative to penalties, interest, or cheating. 37. It restores individual privacy. The government no longer needs to know where you work, what you are earning, and what you are doing with it. 38. It eliminates the need to have a "marriage" clarification declaring who you live with, as that has no bearing at all on a state or federal sales tax. 39. It eliminates the need for courts to decide which divorced parent gets to take the tax deduction for children. 40. It reduces production costs for farmers and other subsidized businesses, leading to a reduction in subsidies, thus reducing the federal budget. 41. It eliminates the administrative costs incurred by states in collection of state sales taxes because states will piggyback the state tax collection onto the national tax collection, for which they are compensated by the FairTax 1/4% administrative cost give-back. [Doesn't this go to the retailers?] 42. It results in a windfall profit for many of those holding taxable corporate high interest bonds at the time of passage of FairTax, since they will not be taxed under FairTax. (A higher interest rate is usually paid to entice investors to buy the corporate bonds rather than go with the lower interest, but tax free, municipal bond s, now.) 43. It shifts the tax to consumption, which consumption tables over time show is more stable than income, therefore the tax revenue stream is likely to be a more stable and predictable amount. 44. It results in Federal Reserve rates being based on current consumption, which is rather stable, instead of future earnings, which are less predictable, resulting in surer inflation prevention. 45. It allows for better planning by businesses, because they no longer have to consider tax implications for everything they do. 46. It makes higher employment or better compensation possible in the small business sector where today it costs approximately three dollars in compliance costs to pay one dollar in payroll and income taxes. 47. It moves many now providing tax preparation, advice, accounting, planning, and records maintenance into an expansive economy where they will be producing goods and services. There they can add to the standard of living of all Americans a nd likely earn more than they do currently, instead of shuffling paper for the government (and not contributing anything economically to society). 48. It relieves citizens of the risk of facing the shift in burden of proof that is so common with the current system, i.e., the taxpayer is guilty unless innocence can be proved, when even IRS staff sometimes give conflicting interpretations. 49. It's simple, unambiguous, and certain, the opposite of the current tax code. 50. It's good for the environment. It reportedly would save about 300,000 trees a year that are needed to produce the paper for the IRS compliance and tax forms, enough to reach around the equator placed end to end 28 times. Also, since it taxes only new items, it would encourage buying tax-free pre-owned cars, clothes, furniture, houses, etc. Reuse is good for the environment, too. Best Regards, John Paul McDaniel Go to: www.fairtax.org __________________________________________________ Do You Yahoo!? Tired of spam? Yahoo! Mail has the best spam protection around http://mail.yahoo.com |