I received a “Stop the Tax Hike” email from my Congressional Representative Tim Scott today. Tim is proud to be a member of the Republican coalition promoting the “Stop the Tax Hike” campaign launched last Friday, July 27, 2012. I applaud Tim and his fellow members of Congress who are truly serious about meaningful, beneficial tax reform. However I side with those who believe the current tax system, just like Obamacare, cannot be fixed, but should be repealed altogether! Any discussion of tax reform MUST INCLUDE the FairTax as a viable solution. The FairTax isn’t just an idea. It is actual proposed legislation co-sponsored in the U.S. House of Representatives as HR.25 by Rep. Tim Scott R-SC, and co-sponsored in the U.S. Senate as S.13 by Sen. Jim DeMint R-SC. I’m going to take the liberty of editorializing the 4 bullet points included in Rep. Scott’s email from a FairTax perspective.
1. Simplify the Tax Code: The first step must be to flatten and lower both corporate and individual tax rates. By simplifying the tax code, and easing the burden on businesses and individuals, we can help jump start the economy and get Americans back to work.
1. FairTax: Nothing is simpler or flatter than the FairTax. There will be no income tax burden on individuals, small businesses, or corporations at all! The FairTax eliminates the IRS COMPLETELY!
2. Eliminate the Death Tax: People work their whole lives just to have an opportunity to leave something to their children when they pass on. When you consider income tax, capital gains tax, property tax, sales tax, and the myriad other government “fees” these individuals have paid over the course of the lifetime, it’s clear that the government has gotten more than its fair share of their assets. Yet the federal government immorally taxes them again upon death! The death tax must be eliminated as a matter of fundamental fairness.
2. FairTax: The FairTax eliminates the Death Tax!
3. Move To a Territorial Tax System, and Allow Repatriation: By taxing only income earned within its borders, the United States would become more competitive in the global economy. Also, by reducing the tax rate on repatriated assets, the United States would free up cash that would otherwise be trapped overseas. The flow of dollars back into this country would stimulate the economy, provide jobs, and encourage investment inside the United States.
3. FairTax: The FairTax eliminates ALL income taxation within the United States! I’m all in favor of the repatriation of assets currently held overseas.
4. Lower the Overall Tax Rates: It’s simple economics. Lowering tax rates encourages economic growth, creating more wealth and therefore more overall tax revenue. By making the pie bigger, everyone wins – including the federal government.
4. FairTax: The FairTax Prebate completely untaxes all legal heads of households up to the poverty level. All Federal withholding disappears from a wage earners pay stub. Withholding from and taxation of 401k and IRA distributions, savings accounts and investment portfolios stop! Business is no longer income taxed. Economic growth will boom throughout the economy generating wealth above and beyond savings and reinvestment. This additional wealth will be spent by consumers benefitting from the new goods and services brought to market by entrepreneurs unbridled from a business stifling income tax. The undocumented “cash economy” of petty thieves and career criminals joins the tax pool as wealth is taxed vs. income. The unseen imbedded corporate and business taxes that are reflected in today’s retail pricing will go away enabling actual price reductions for most retail goods.
Please spend a minute calling and/or writing Congressman Scott thanking him for co-sponsoring the FairTax HR.25. Encourage him and all members of Congress to promote the FairTax as the means of reaching the four tax reform goals he and his coalition are working to achieve.