How Is The FairTax Fair?

Glad you asked. Actually, a FB buddy, John Ingraham Berry said, and asked:

Burdensome on those families and individuals who have very little… have a little trouble grasping and seeing the fairness of this concept.

It’s really very easy, especially on the poor. Once you understand what’s in the bill, it’s like a ‘slap yourself in the head’ brilliant concept. For lack of any media excitement or mediocre coverage of the FairTax, getting people to learn what’s in the bill, as opposed to what the establishment says about it, which is pure demagoguery, is the biggest challenge.

Under every circumstance EXCEPT the FairTax, a consumption tax is regressive. By percentage of income, it hurts the poor the worst. The FairTax doesn’t do that. It is progressive in a way that benefits the poor the most, as you will see below.

Here’s the short version.

1.) Everything everyone (poor included) buys today is paying all the income and corporate tax, capital gains, gift, estate, alternative minimum, SS and Unemployment tax, and self-employment tax of everyone involved in bringing that item to market, from raw materials, to manufacturing, to transportation, and all the costs of a wholesaler and retailer to bring the item to you, the final consumer. Call that the “embedded” tax. Everyone pays it, it’s in the cost of the item. It just isn’t itemized on your receipt. It’s hidden in that way, but it is there. Under the FairTax, the amount of federal tax you pay will be printed on your receipt. Totally transparent.

Now imagine what the same item would cost if there were no embedded taxes, if that product could be made with none of the above taxes. After over $22 million of research, the percentage amounts to about 22 % less.

The research included, of course, finding out what people buy at all income levels. No small task. That done, for the FairTax to be ‘revenue neutral,’ the FairTax percentage comes in at 23%.

That doesn’t mean an item automatically costs 23% more under the FairTax than it does today. When you remove the 22% embedded tax, and replace it with a 23% sales tax, you see a 1% increase in price on a widget. This is an average, not an absolute. One method is swapped with the other, having a negligible effect on cost to consumer.

2.) Here’s what the critics don’t tell you, or don’t know about. There is NO TAX on used items, including a car, motorcycle, boat, or house sold that was not bought by the ORIGINAL owner. The sales tax is ONLY for NEW items purchased for the FIRST TIME. Fair thing is, this applies the same to everyone, at all income levels. Including tourists, diplomats and other non-citizens.

3.) Because it is a consumption tax, assessed to new items sold, everyone pays it. The tax base instantly expands to 320,000,000 people instead of only legal citizens who have a job. What we have now is an income tax. No income = no tax revenue. And a tax base less than half of that. And because of that dynamic, the FairTax is a more stable revenue source. Fair thing is, this applies the same to everyone, at all income levels. Including foreign tourists, diplomats and other non-citizens, legal or illegal. And that tax never exceeds 23%.

4.) This is the part that makes this consumption tax progressive, instead of regressive. The Prebate. Designed to be the same, aka fair. Everyone gets this prebate based on the number of people in the household. And the prebate is for legal U.S. citizens only.

Now a new term to learn, effective tax rate. Based on the consumer spending research mentioned above, the amount of the prebate is figured to offset the sales taxes that would be paid for the basic necessities that everyone buys up to the poverty level as determined by HHS. It is paid to the household every month. Taking the prebate into account, lower income people pay less than 23%. In fact, the prebate at the lowest income levels make the effective tax rate a negative number. An income stream.

5.) Absent all the embedded taxes, at the federal level, the term ‘take home pay’ becomes obsolete. Your gross pay is also your net pay. THAT makes a big difference for all people, especially the poor. Currently, for every job, and many people do have 2 or more jobs, they pay those embedded taxes. Can’t get more regressive than that. Imagine the effect when they are not taxed every time they get another job. Purchasing power goes up for everyone, only greater for the poor. The rich pay the maximum 23%. But since “the rich” also buy more, they pay more taxes in dollars, obviously, than the poor, when they buy their yachts, cars, planes and other high-end toys. That’s how it affects families of all income levels, on the personal level.

6.) No more income taxes to file. And because of that, there is no compliance cost incurred to pay them. No tax preparers, accountants, or tax lawyers to pay. In total, a saving of over $400 billion. And, the IRS is effectively gone.

7.) On the national, macro level, absent the income tax, the $10-15 trillion that U.S. companies have sheltered overseas will come back to be invested here, since there will not be a tax obligation to shelter it from. Then, with the absence of an income tax, foreign business will come here and open up shop. The U.S. will become a global magnet for businesses. The U.S. will become the “offshore tax haven.” There will be a job for anyone who wants to work. Maybe more jobs than people. And competition between employers to get employees will do what? Increase wages. We will experience real economic growth on a personal and national level. And none of it  government subsidized, adding to the national debt.

fair-tax-before-after1

How the politicians spend that is another matter. The FairTax is only to be the replacement source for funding the government. It has nothing to do with how that money is spent or where it is allocated.

You can read the text of the bill HERE. It’s not 75,000 pages like the current IRS code. H.R. 25 is a whopping 132 pages long. And more information is available at the link at the upper right-hand corner of your screen.

Link: H.R. 25: FairTax Act of 2017

Obama’s 2A Parting Shot

The Federal form required to buy a firearm from a gun dealer, the 4473,  was revised and in effect as of last Monday, Jan 16, 2017.

The Department of Justice has come down on the subject of medical marijuana and the penchant for gun control. Added to the question of addiction and unlawful use of drugs, 11 e., is a warning for users of marijuana. Even if legal in your state, whether by prescribed medical use or decriminalization, you are prohibited from purchasing or receiving a firearm.

11 e. Are you an unlawful user of, or addicted to, marijuana or any depressant, stimulant, narcotic drug, or any other controlled substance?  Warning: The use or possession of marijuana remains unlawful under Federal law regardless of whether it has been legalized or decriminalized for medicinal or recreational purposes in the state where you reside.

In the case of marijuana, there seems to be no qualification of addiction. Only that as a Federal matter, “use” of it is illegal, and that alone will deny a person’s 2nd Amendment right to purchase, or receive, a firearm.

Also added is a question to identify the name and location of a ‘qualifying gun show or event’ if the firearm is being ‘transferred’ there. Laying the groundwork to require private sales/transfers (i.e. not a gun dealer) at gun shows to include a background check. And quite possibly, anywhere else.

So, with less than a week left in the Obama administration, along with sending GITMO terrorists back to their homeland, commuting FALN militant Oscar Lopez-Rivera’s sentence, commuting the sentence of the biggest traitor in American history, the Obama DOJ tosses this 2nd Amendment issue up for his successor.

Form 4473, Firearms Transaction Record by Ross Calloway on Scribd

Link: ATF Form 4473 – Firearms Transaction Record Revisions

Buh Bye United Nations

It’s long past time for the country to break from the United Nations. Their performance and history has proven to be out of sync with the intent of its formation.

In that light, I’m please to share with you the thoughts of our new Dist 1 representative Matt Gaetz (R-FL). From his newsletter . . .

Withdraw from the UN

It is past time to get the U.S. out of the U.N. – and to get the U.N. out of the U.S. This week I joined Rep. Mike Rogers (R-AL) in proposing legislation to do just that. The U.N. has become an anti-US, anti-Israel organization. It cannot be trusted to inspire nations to peace or prosperity. I continue to support a restored American presence in the world through direct action and direct coalition building, led by our new president.

Link: In the wake of Brexit, Alabama congressman wants U.S. to exit U.N.

US Intelligence Report

So the best the intelligence community can come up with is that Russia’s media, like RT, tried to influence the American people against Hillary, to try to influence voters to pick her opponent.

And, didn’t we just experience an onslaught of American media aligned against one candidate, for another? Like, against Trump and for Hillary? Thought so.

Am thinking, wasn’t the Obama administration’s overt attempt to unseat Netanyahu in his re-election campaign much worse?

Bottom line, sore losers in search of an excuse for losing. Twice. Refusing to accept responsibility is a sign of immaturity.

Daily News, Everywhere

Industries come and go. When it comes to the print news media, like your hometown newspaper, it seems the industry is under pressure to stay in business. Circulation has dropped, their labor force (including the news department) has thinned, some of their processes have been outsourced, all in efforts to stay in business.

Not too long ago, the paper width of the PNJ (Pensacola News Journal) was reduced by maybe 20-25%. For national content, they added a USA Today section, but you will see it has the same news article as in another section, in the same issue. Now I’m noticing that they are publishing articles that they published a couple of days earlier. The same article, nothing new, but on a different page. Filling space once used by advertisers with duplicate news articles. On the marketing side, they offer fewer options.

The “print news media” industry is fading, and failing. Taking a big hit from online media and what has become known as the “new” media, the newspaper industry seems to be on its last leg for a number of reasons.

One brought on themselves through more advocating and/or shaping opinions than simply reporting the who, what, when, and where of what happened, contributing to intellectually curious consumers migrating to online news sources. The Internet, per se, is not responsible for the demise of traditional newspapers, there are just as many fake news sites out there too, but the mere presence and availability of it has changed the way we get up in the morning and get our news.  Like the long-gone Catalog Showroom industry, newspapers today are dealing with a consumer shift that just may be putting them irrelevant and, out of business.

A Party In Shambles

Starting with this part of President Obama’s legacy . . .

Beginning in 2017, Republicans will hold 33 governorships and fully control legislatures in 25 states, as well as the Congress and presidency. During Obama’s two terms in office, the party lost more than 1,000 seats at the state and national level.

“I love President Obama, but he and his administration allowed for the deterioration, the terrible deterioration, of the state parties over the last eight years,” said Mark Brewer, who led the Michigan Democratic Party for 18 years.

The job at hand now is to pick a new leader for the Democratic National Committee. You will remember that Rep. Debbie Wasserman Shultz stepped down after being caught tipping the scale in favor of Hillary over Bernie, and Donna (CNN debate cheat) Brazile took over temporarily, until a permanent Chair could be found.

You have to look for news about the party because their media isn’t talking about it. Too busy hyping ‘the resistance’ to President-elect Trump.

Most people know that Rep. Keith Ellison (D-Minn) wants the to be DNC Chair. But most people don’t know that he isn’t the only one “running” for the position to lead the Democrat Party. There are six. Besides Ellison, former Vermont governor and DNC chair Howard Dean, South Carolina Democratic Party chair Jaime Harrison have formally declared their candidacies; NARAL Pro-Choice America chair Ilyse Hogue is interested, as is New Hampshire Democratic Party chair Ray Buckley, and Labor Secretary Tom Perez.

Also missing in the media is the feeling among democrats that the candidates should debate, in public, for the position. But this would be counterproductive to the feeling among establishment democrats that Ellison is the one. Like Hillary Clinton was supposed to be ‘the one.’

Aside from there being nothing going on in the media about a successor for Donna Brazile, there’s really nothing going on from those six wannabes over what President Obama did to Israel at the United Nations. They’re not saying, and the media is not asking. The leaderless party seems to be emulating Hillary Clinton’s campaign, avoid press conference and stay home.

Links: The Candidates for DNC Chair Should Debate Each Other in Public  |  Leading DNC Candidates Duck Debate Over Obama’s Handling Of UN Israel Resolution  |  Out of Power, State Dems Frustrated With National Committee

Liberal “Update”

If you think the last few years have been bad, and the recent election might have caused a bit of political self-reflection, you’d be wrong.

Look what Valerie Jarrett, President Obama’s senior advisor and Muslim Brotherhood sympathizer, said this morning.

The plan is perpetual denial, as if elections don’t have consequences when they lose.  Apparently, it’s only when they win.

Despite the fact that Trump has already entertained the wackos on the Left for their input since the presidential election, DNC Chair Donna Brazile starts the false claim that they are excluded.

Translation: Because we lost, you have to give us what we want anyway. That’s what they call “reaching out.” Seems to me that since they lost, they’re the ones who need to do the reaching. Maybe even getting acquainted with the American people again and the things that they want?

Hillary’s Email? It Ain’t Over

No. It’s not over for Hillary and her email handling. And that’s a good thing.

In a new legal development on the controversy over former Secretary of State Hillary Clinton’s emails, an appeals court on Tuesday reversed a lower court ruling and said two U.S. government agencies should have done more to recover the emails.

Sooner or later, she needs to put her hand on the bible and speak under oath. The same as would happen for anyone else who mishandled national security details.

Equal justice under the law is what this country is all about. Letting one go while prosecuting others?  “That’s not who we are.”  Right Hillary?

Link: U.S. appeals court revives Clinton email suit

 

Belly up to the counter. Politics are on the menu and Ross is on the grill.