Why don’t they just gift wrap the election and mail it to Kerry? Christ, talk about a fat pitch over the plate…
The sad thing is, I have to wonder how many Joe Average voters wouldn’t welcome this news, even if it turns out they would get completely screwed by the resultant system. Your average american simply hates income taxes, and would say yes to just about any claims that we could get rid of the IRS, no matter how ill-conceived the plans might be.
Just as long as it’s not a poll tax… the resulting cries from Democrats would be simply astounding.
God this is the truth. It never ceases to amaze me how totally stupid the average American is regarding the burden of taxes. Most of my co-workers have the spoiled brat psychology of the American consumer who regards any impediment to the immediate gratification of desires as an attack on one’s personal freedoms. Taxes in particular are seen as some sort of assualt by a faceless bureaucrat who only wants to steal your money, put in a big pile and then set it on fire.
If I can ever get people to sit still and have a conversation about the declining marginal utility of money, progressive taxation, estate taxes, and the rest they usually sober up and realize that what they really hate is waste and not the actual practice of taxation. I have met very few libertarians who were philosphically grounded, most were rather reactionary. They are too many financial illiterates who would automatically regard the abolition of the IRS as a good thing in the same way they are regard all taxes rebates as de facto good things.
Yeah, those liberal pussies… way to take them to task for being against charging people to vote.
thumbs up
If you want to see how this hare-brained idea is playing with the average American jackhole, here’s the take at gonegold’s forums on it. Be prepared. After reading this thread here and reading that one there, I’d felt as if I’d left a cool bookstore and wandered into a Wal-Mart on Saturday at 10 am.
Other than getting the President to declare Sundays as “Free Beer Day”, I’m not sure how he could better appeal to the great unwashed masses. If this isn’t Drudge talkin’ out his ass and has factual basis, I think it gets Bush elected. At which point none of this happens, because the GOP won’t get enough votes to overturn the tax code in congress, OR it does happen, reduces what’s left of the US economy to cinders, and results in 30 years plus domination by anyone but conservatives in the halls of power in DC.
Is this what is being talked about here? If so, it doesn’t strike me as a bad plan right off the bat, although I’m still going through their research section.
Eliminating the IRS is a pipe dream.
Jason, I have the opposite reaction: I feel like this cheap ploy will gain some support amongst those without much of a clue. There are a lot of people who just HATE the IRS with an unreasoning passion and any promise to negatively impact the IRS will gain support, even if its token and meaningless.
For example, lets say they do scrap the income tax in favor of a Value Added Tax, and scrap the IRS to boot. OK, so then they create the VAT Revenue Service (VRS). No matter what name you slap on it there is no way in hell the government is going to permanently remove its tax collecting agency. But a lot of dopes will be swayed by this, IMO.
I consider this a cheap and obvious ploy like the Mars missions trial balloon floated earlier this year. However, that, sadly, doesn’t mean it won’t work to at least a small degree.
If Americans end up re-electing Bush this year, we’ll be getting the government we deserve :(.
Dan
Bush has done nothing but play to his base for the last few weeks. Let me give you a hint Mr. President: They’re going to vote for you, if they, you know, manage to get out and vote…
This is nonsense. It’s a trial balloon being sent up, and it’s only point would be to try and throw Kerry off balance. If we’ve learned one thing about Bush and pals they only act tactically, never strategically…
But I think that the country at large is suffering from “idea fatigue”. Bush is constantly throwing up these “big new ideas”. But even amongst the red meat crowd I think few actually believe Bush will act on any of these proposals. He’s simply firing jolts of electricity into the legs of the electorate, hoping the frog will jump in his direction.
Mars, bitches!
I am all for removal of all income taxes (personal and corporate.) If Bush actually stumps for this, he will get my vote back.
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Tens of billions of dollars and hours are spent annually on trying to comply with/beat the tax code, as well as all the money and time spent lobbying Congress for favorable tax treatment. Removing that drag would be good for everyone.
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Yes, rich people would do a happy dance because they spend a lot less as a percent of their income on consumption. This also means repeal of the inheritance tax.
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A consumption tax encourages saving a lot more than an income tax. This is good in the long run for the economy.
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House prices might take a hit in the short term since the tax will increase prices and remove the tax deduction for mortgage interest since there will no longer be income tax to deduct against.
The economic benefits of changing the tax structure outweigh the regressivity. Give everyone a $20,000 spending exemption on the sales tax to help lessen the latter.
Joshua- Saving isn’t good for the economy, consumption is. Your proposed spending exemption would be just as much of a logistical nightmare as the current system.
One, the libertarians in the Gone Gold forums aren’t a big group, or even a swing vote.
Jason, I have the opposite reaction: I feel like this cheap ploy will gain some support amongst those without much of a clue. There are a lot of people who just HATE the IRS with an unreasoning passion and any promise to negatively impact the IRS will gain support, even if its token and meaningless.
For example, lets say they do scrap the income tax in favor of a Value Added Tax, and scrap the IRS to boot. OK, so then they create the VAT Revenue Service (VRS). No matter what name you slap on it there is no way in hell the government is going to permanently remove its tax collecting agency. But a lot of dopes will be swayed by this, IMO.
I consider this a cheap and obvious ploy like the Mars missions trial balloon floated earlier this year. However, that, sadly, doesn’t mean it won’t work to at least a small degree.
If Americans end up re-electing Bush this year, we’ll be getting the government we deserve :(.
Dan[/quote]
Let me frame it for you:
Benefits: Eliminate the IRS, which no-one likes, and simplifies tax calculations (theoretically; I don’t believe for a second that the tax code would actually become any simpler).
Con: Raises the taxes of everyone who’s not a millionare.
People don’t like the IRS, but they’re not stupid.
No it wouldn’t. Demonstrate $20,000 in spending and get the sales tax refunded. That is only 200 receipts at $100 each, or 1 car purchase. It is a lot less invasive than income tax.
On saving vs consumption, the latter drives GDP in the short term, but savings increases investment which is a better long-term underpinning for any economy. All the economic schools (Keynes, Austria, Neo-Classical, Monetarist) agree on that
Jason, there’s a fraction of the voter base who gets as far as your point 1, and doesn’t pass go to collect point 2. That’s what this idea is about.
MrJoshua, for a better response than I can write, see Matt Yglesias:
http://yglesias.typepad.com/matthew/2004/08/no_irs.html
When people talk about tax reform they lump 3 different concepts together. The first is progressive vs regressive taxes, which means do low income or high income folks pay the taxes, and how much. Basically the first issue is tax rates. The second issue is the current webwork of tax incentives, deductions, exemptions, etc ad nausem vs a more clean streamlined systems. I’ll call the second issue loopholes. One further point of confusion is that people often use the term “flat tax” to refer to both of these ideas: sometimes they mean flat in regard to rates, as in non-progressive, and sometimes they mean flat in regard to loopholes, as in removing exemptions, deductions, etc. The third concept that gets thrown in is tax type: do we tax income, labor, capitol, inheiritence, consumption etc? And of each type, how much?
The assumption by many is that “tax reform” would somehow streamline all of the above and would be easier, fairer, more efficient and generally better than the current system. The problem is that the devil is 100% in the details. It is possible to have a “progressive consumption” tax; its possible to have a regressive consumption tax, or a consumption tax with no loopholes, or with many loopholes. Just saying you are for “tax reform” or that you want to replace the income tax with a consumption tax is pretty meaningless IMO - you have to explain in at least broad outline what the proposal is.
And of course the reason these ideas stay on the drawing board is that everytime a reform proposal gets revealed in its details, somebody’s ox gets gored big time. For example, a straight consumption tax, flat rate, with no deductions, would heavily smack the middle class. If you want to see whining, just wait until homeowners with massive mortages see that interest deduction disapear. Of course you could say “well, the mortage deduction is OK”, but then what about child deductions, charitable deductions, education deductions, housing, education, etc. Hey pretty soon you need a VRS twice the size of the IRS :).
I’m all for reforming the tax system, if you do it in an intelligent way that actually makes it better and more efficient. But just tossing out buzzwords and promising to nuke the IRS is cheap-ass politics :).
Dan
You must live in an interesting world if you think saving the receipt for literally everything you purchase for one year (every trip to the grocery store!) is harder than copying a W-2 onto a tax form.
As to increasing investment:
- Any real-world econometric evidence that switching to VAT would increase investment? The GOP insisted Reagan’s tax cuts would increase domestic investment; they didn’t.
- The limiting factor on US growth right now sure as hell isn’t capital; we’re drowning in it, the rest of the world practically giving it to us for free.
- How much of that “tens of billions of dollars spent on tax compliance” is due to rich people trying to evade taxes? Maybe it’s just the circles I move in, but no one I know spends more than $50 a year or so on tax preparation.
Joshua- VATs and such discourage consumption. They create deadweight loss. Income taxes don’t. A progressive income tax allows the most money to be extracted with the smallest utility loss.
Given our current interest rates, do you really think America needs to save more?
Right now, it takes me like an hour to do my taxes. Can you imagine the headache of demonstrating spending? Also how will you stop fraud? Audit whether they really ate that sandwich? People will try to spread their spending around their poorer friends.
“Saddam Hussein was behind September 11th”.
Foreign policy isn’t domestic policy…