The IRS depends on your payroll taxes to fund the federal government. The more people find themselves out of work, the tax base shrinks further, the less revenue the government gets and the more debt the government acquires, adding to the burden of current and future generations of Americans.

By contrast, when all the federal tax categories you pay are eliminated and replaced with the progressive consumption-based FairTax, that revenue stream to the federal government is not exclusively tied to employment. The result is the largest tax base humanly possible and a more stable income stream.

When you hear, like you may have heard yesterday, that consumer spending increased ‘more than expected’ (by a laughable one half of one percent) you should also understand that it translates to increased revenue to the federal government. When the tax burden is spread out over everyone instead of to only those who are lucky enough to still have a job, we reach the fairness that the administration claims they want without penalizing the people who have the ability to create jobs.

Special note to FairTax supporters in the Florida Panhandle. I have a quantity of 4ft. by 8ft. FairTax signs that are FREE to anyone who has a good location (high-traffic area) to display them. Let me know if you want one. This is what it looks like.

FOR IMMEDIATE RELEASE
Contact: James Lafferty
(703) 931-­‐2324
jameslafferty@usa.net

Americans Frustrated Watching Tax Policymakers Play “Ground Hog Day”
Washington, DC – Americans for Fair Taxation (AFFT) released today revenue
estimates that the FairTax, a national sales tax, would have collected far more
federal revenue in 2009 and 2010 than the current income tax based system.
The estimates demonstrate that FairTax-generated revenues for 2009 would have been $171 billion more than the IRS revenue and in 2010; the FairTax would have generated $267 billion more.

AFFT provided the data to the Joint Select Committee on Deficit Reduction or
Super Committee recently and is releasing it to the public today.

“ Watching Washington tax policymakers churn a few well-worn and ineffective
ideas to come up with the same disappointing results is like watching the movie
‘Ground Hog Day’, except this is real life not a movie” said AFFT Chairman and
Co-Founder Leo E. Linbeck, Jr.

“No wonder the American people are so frustrated! Some in Washington want to
adjust and tinker with the current sclerotic system but working Americans are
ready to throttle it and them and start fresh. The time for reform is over. We need to be seeking replacement.

“The FairTax is a hybrid within the range of consumption tax alternatives— more
transparent, simpler and it returns the power to determine how much tax is paid to the American people.

“We believe it addresses the nearly $1.5 trillion in deficit reduction the
congressional deficit committee is charged with making, and responds to the nearly $4 trillion in cuts offered by Democrats and other partisan issues.

The FairTax projections are based on a 23 percent tax inclusive rate of taxation as proscribed in the Fair Tax legislation (HR 25/S 13).

The estimates were provided by David Tuerck, Chairman of the Economics
Department and Executive Director of the Beacon Hill Institute at Suffolk
University in Boston.

“Because revenues from a consumption tax are always more stable over the
business cycle than revenues from an income tax, it stands to reason that the
FairTax would have reduced the deficit in recent years, had it been in place,” said
Tuerck.

Formed in 1995, AFFT is a nonprofit, nonpartisan, grassroots organization
dedicated to replacing the current tax system with a progressive national retail
sales tax.

(For a copy of the FairTax data go to www.fairtax.org or call 703-931-2324)

By 1913, 36 States had ratified the 16th Amendment to the Constitution. In October, Congress passed a new income tax law with rates beginning at 1 percent and rising to 7 percent for taxpayers with income in excess of $500,000. Less than 1 percent of the population paid income tax at the time.

Americans Paying Zero Federal Income Tax Grows

There is a growing number of Americans who pay zero federal income tax after taking advantage of deductions and credits.  This, a result of morphing the income tax system into spending programs during the Clinton administration. The number of Americans in this group has increased by 35%. Up from 43.4 million people in the 2006 tax year to 58.6 million in the 2009 tax year.   No doubt due to record unemployment and more wealth-spreading going on.

Prior to The Taxpayer Relief Act of 1997, tax relief was generally given in the form of lower tax rates or increased deductions or exemptions. But the 1997 Act  launched the modern proliferation of individual tax credits and refundable credits that are in essence spending programs operating through the tax system.

Large Number of Non-Payers Make Tax Reform Difficult

Federal tax reform requires that the base of the federal income tax be widened, so that overall tax rates can be reduced. However, because of the large number of Americans currently paying zero federal income tax, any attempt to broaden the tax base will be a difficult sell for lawmakers. The millions of Americans who have no federal income tax liability will either be indifferent about tax reform or will positively oppose it, as it would require bringing them into the federal tax base.

When more people don’t pay taxes than pay taxes under the current system, why would anyone think that these non-payers would vote for anyone who would make them pay a ‘fair’ share? Similar problems are bankrupting European countries over benefits. Reforms there means taking benefits away.

These findings raise serious questions about the future of the U.S. income tax system, and the possibility of base-broadening tax reform when the majority of the federal tax burden is borne by a shrinking pool of taxpayers.

I got your base-broadening tax reform right here. It’s called the FairTax and it is what ‘Phase 2′ of Herman Cain’s economic plan is all about. It broadens the tax base from 140 million people to every living human being within the borders of the United States. Under the FairTax, the tax base includes our population of 320 million, plus foreign tourists, diplomats, and illegal aliens. You can’t get a broader tax base nor a better stimulus for job creation, economic growth, personal economic security and national economic security.

After addressing that issue today at the National Press Club’s luncheon, it seems to me that Cain knocked it out of the park as a non-issue. Not only did he knock that one out, but he explained his plans for his administration regarding the economy, foreign relations, and everything else very well.

That said, here is Cain’s date with the National Press Club. For walking into the media’s house and answering all the tough questions squarely, I think he handled himself and his campaign chances very well.

As for the actions of Politico, they are just showing their colors.

We get there in two stages. Phase one is the 9-9-9 taxing structure, which also ends the payroll tax, capital gains tax, the death tax, and the elimination of double taxation of dividends. It also eliminates the fear, uncertainty, and doubt caused by our current tax policies and the politicians in Washington. The economic impact is immediate, and sets the stage for the permanent, more stimulative, and more progressive ‘FairTax’ method of funding the government.

That there are two stages is out of necessity. The FairTax requires more time to educate the public of its benefits to them and to the country. It is Phase One that will get us going sooner than later, and in due course it will be replaced by the FairTax.

The FairTax is the best long-term solution to funding the government in a business friendly environment than anything ever tried in the United States. It is the bold reform that we need.

The demagoguery begins with misrepresentation #1. Adding a sales tax. The truth that they all intentionally miss is that this plan REPLACES (that means ends) the current income tax, payroll tax, capital gains tax, death tax, and the double taxation of dividends. This 9 percent sales tax is not in addition to the current IRS tax code. The taxes that are eliminated more than make up for a 9 percent tax which is applied only on new goods and services. Advantage to ‘working people.’

On the corporate / business level, Cain’s 9-9-9 plan provides certainty. The 9-9-9 plan eliminates the FUD factor. The biggest impediment to economic recovery we face is the Fear, Uncertainty, and Doubt that this administration foments, and that Cain’s challengers’ plans do not address. His challengers want to tinker around with the current abortion of a tax code which is part of the problem for our economic woes. The current tax code, which supports hundreds of special interest lobbyists and manipulative politicians, must go.

Whether it is a deliberate dodge or incomplete preparation, Cain’s opponents (media included) don’t talk about Phase 2 of Cain’s plan for economic recovery. That’s because they have nothing better that can touch it.

Phase 1 will give an immediate stimulus to business and personal income. It will end the FUD factor. It will increase the tax base. It will level the playing field for our multi-national businesses. The reason Phase 1 is needed is because it will be an economic stimulus right away. And it does all that now.

The other blatant obfuscation of Cain’s 9-9-9 plan is its ‘Phase 2.’ Enacting the FairTax requires educating the folks about it. Because of that, it will take longer to implement. What they are all missing is that 9-9-9 is the bridge to the FairTax. 9-9-9 is Phase 1. The FairTax is Phase 2. Which so far has not even been mentioned by his opponents or the media.

Bottom line, Herman Cain has the right solution to the country’s problem. It is bold enough to do exactly what is needed. The FairTax will be the economic engine to grow our economy. And growing the economy is the only possible way to solve our economic problems. The solution is not higher taxes. The solution, according to  Cain, is eliminating the FUD factor, decreasing spending, broadening the tax base, and decreasing taxes.

Finally, the FairTax will see the light of day for the first time. As Vice President Joe Biden would say, this is a big f’n deal.

There is something you can do to help in the effort for tax reform and the FairTax.  See below from FairTax Nation.

FairTax Nation

Replace All Federal Taxes on Income with the FairTax Act of 2011, HR 25 & S 13

A message to all members of FairTax Nation

Good news! Rep. Camp the chairman of the House Ways and Means Committee has scheduled a hearing on the FairTax Bill before the entire House Ways and Means Committee on July 26, 2011! This is the first step toward moving the bill to the floor of the House for a vote!

We have a lot of work to do to maximize impact with the FairTax hearing.

1) If you can make it to Washington to Storm the Hill please come. Halls full of FairTaxers make a great impression! For information go to: www.FairTaxNation.com If you show up in DC, they know you are serious!

2) Please contact your members of Congress who sit on the House Ways and Means Committee, inform them about the hearing and encourage them to attend. Contact them now and again a few days before the hearing.

Full committee can be found at: http://waysandmeans.house.gov/About/Members.htm#5

Contact information for members of congress can be found at: http://www.contactingthecongress.org/

3) Contact CSPAN and encourage them to broadcast the hearing. http://www.cspan.org/About/Contact-C-SPAN/

4) Contact you members of Congress and let them know the hearing is taking place. A personal visit to their local office, etc. is a great way to get their attention.

5) I am not sure how to do this yet, but I would like a DVD of the hearings to distribute to members of congress and other tax organizations.

6) Attend the August town halls, tea parties, campaign stops, and talk – talk -talk about the FairTax.

Remember we need you at the Iowa Straw Poll in Ames Iowa on August 13, 2011. This is an extremely expensive event, for example the cost of just the fuel to run the generators is a big expense. If you want to donate to the grassroots effort go to www.FairTaxNation.com Information on the Straw poll will be posted shortly.

We must always remember to be politely persistent as we still have a long path ahead of us but the path seems to be getting shorter every day!

Questions? Just ask!

Marilyn Rickert

Let’s start with conservatives. The FairTax enjoys more support from this quarter than any other tax reform proposal, including the flat tax and the reforms outlined in Congressman Paul Ryan’s Path to Prosperity. The latter two reforms provide for large personal exemptions and do not specifically tax imports. By taxing a wider base with a lower comprehensive average marginal rate, on the other hand, the FairTax encourages more new hiring and faster economic growth. Several dynamic simulation studies suggest U.S. GDP could be 10% higher in a few years under the FairTax than under the current tax code.

But the FairTax should appeal to progressives as well. It eliminates subsidies to Cadillac health plans and millionaire mansions, along with the regressive Social Security tax. It makes the wealthy pay taxes on their consumption while permitting the poor to consume tax-free. It eliminates every vestige of corporate welfare that is embodied in today’s tax code.

A 2006 study by Kotlikoff and Rapson comparing remaining lifetime tax rates under the current system versus the FairTax for households of varying age and income levels showed the reduction in tax rates to be greatest for the lowest earning households. For example, a single woman aged 60 making $25,000 per year and facing an effective tax rate of 14.1% under the current system would instead have a negative 6.2% rate under the FairTax, due largely to the effects of the FairTax prebate (a government subsidy financed through the tax itself) and elimination of the payroll tax. The FairTax is arguably more progressive than the current system, the flat tax or the Ryan plan.

A study by the Beacon Hill Institute concluded that if we group taxpayers by expenditure per capita, the average taxpayer in the top decile loses under the FairTax (with lower levels of after-tax consumption than under the current system). The relative treatment of the lifetime poor versus the lifetime rich under the FairTax, once understood, make the tax cuts for the rich argument against the FairTax ring hollow.

A tax is more truly progressive if its burden falls most on the people who consume the most. Progressive economists such as Robert Frank have argued that rising income inequality due to disproportionate growth in the incomes of the statistical top 1% of income earners is not an egalitarian concern per se. The problem is that the spending habits of the increasingly rich create “expenditure cascades” that make it harder for middle-class families to make ends meet and increase their sense of relative material inadequacy. The FairTax is an answer to this problem.

Libertarians, for their part, should celebrate the end of income tax withholding. As FairTax proponents Neal Boortz and John Linder have put it: “[I]ncome taxes are seized. Consumption taxes are paid.” Equally celebrated should be the end of the practice of ratcheting up the tax rates on top earners in the pursuit of new revenues and of selling tax expenditures to special interests for votes or campaign support. The FairTax calls for one universally transparent rate to be paid by everyone on all final consumption. Thus, everyone acquires an economic interest in all government spending decisions and the tax code disappears as a playground for special pleaders. There should be a natural convergence of conservative, progressive, and libertarian pundits who oppose the blatant cronyism that goes on now.

No tax system is perfect. Substantive criticism of the FairTax has centered on transitional issues and the rate necessary for revenue neutrality. But much of the detractive criticism amounts to pointing out small holes in a barn door without acknowledging the utility of the barn to the horses inside. The main objective of any tax system should be to keep marginal rates low, since, as marginal rates rise, wealth destruction rises disproportionately.

Conservatives worry about a FairTax political bait and switch; the Wall Street Journal editorial board has expressed such skepticism. If the Sixteenth Amendment to the constitution is not repealed (as is called for in the FairTax legislation), the country could end up with both an income and a sales tax. But the legislation also has a provision that would repeal the FairTax and reinstate the income tax if the Sixteenth Amendment is not repealed within seven years to prevent both from being in existence at the same time. The best insurance against such an outcome, however, is a broad, bipartisan understanding of the virtues of the FairTax.

The Ryan plan and the flat tax are no less susceptible to political demagoguery than the FairTax. Political candidates able to deliver a clear and consistent defense of the FairTax, such as Saxby Chambliss (R-GA) and Marco Rubio (R-FL), have successfully overcome attack ads and advanced their careers in the process.

In 2005 eighty academic and business economists formally endorsed the FairTax. It is entirely conceivable that libertarian philosopher Robert Nozick and his longtime intellectual rival, egalitarian philosopher John Rawls, if they were alive today, could shake hands on the FairTax. The philosophical differences between the average Democrat and the average Republican are trivial by comparison.

Link: The Political Basis for the FairTax