Comment Re:Unfair tax [Re:Screw the American auto industry (Score 1) 303
BLUF: (Bottom Line Up Front)
To repeat what rally2x said: "Luxury goods" is a misnomer - it's actually spending above the poverty line that is taxed.
Under most standards, the criteria to get the prebate IS NOT COMPLICATED: Are you a legal resident of the USA? You get the prebate.
VAT: Could you please give me your definition of VAT so we can figure out what the difference is? I think you're using VAT where you mean "national sales tax". Fairtax is not a VAT by default, though it could be implemented as one fairly easily, but would increase complexity in the USA because that would make simply using the state sales tax agencies (as was proposed) more difficult, because none of them currently do VAT. So you can't do "Add 23% to the stuff you're already taxing".
Well, except it does the exact same thing as VAT, just with added complexity.
Uh, I think we may have different perceptions of what a VAT - "Value Added Tax" is, because I'm still not seeing how Fairtax is a VAT.
Could you please give me your definition of VAT so we can figure out what the difference is?
Again: Value Added is nothing more than a very simple mechanism for implementing a sales tax. Yes, you can make a more complicated mechanism, but the end result is a sales tax that doesn't double tax items when you buy something and then sell it.
But that means that it's an implementation, which fairtax by default would not go with, because none of the states are using VAT.
It's not that simple, I'd argue that there are benefits and negatives to it. For example, in the USA there are entire businesses that don't have to deal with sales tax at all, because they only sell to exempt parties (other businesses). If you go to VAT, suddenly they do. There's extra accounting the businesses downstream have to do, etc...
Honestly, I think you're saying VAT when you mean "national sales tax", because that's in the context of how the EU countries use VAT.
But, of course the "Fair" tax also adds complications for deciding what's "luxury" and what isn't, and also a complicated mechanism for deciding who gets the handout and who doesn't. So, really, it's not just a little more complicated, it's a lot more complicated.
Note, I'm far from convinced that fairtax is actually a good proposal, as I already mentioned. But this indicates that you still don't understand the proposal. To be fair, I'm not really a proponent of it, and rally2xs doesn't necessarily explain stuff well.
But I know full well that rally2xs already explained the luxury thing to you. To wit: "luxury" in this case means anything new that is in excess of poverty line spending. IE $15k for an individual in 2024. $31k for a family of 4. So the individual would get 23% of $15k = $3450/year. Exact amount may vary based on the actual legislation, for example, it wouldn't be that unusual to set the prebate amount at 150% of the poverty line, the poverty line itself might be adjusted, etc...
Complicated mechanism for the handout: Are you living inside the USA legally? You get the prebate. Done. There may be a handful of other exceptions like "fugitive on the run", "currently in prison", and such. But despite the USA imprisoning the most people per capita in the world, that still not that many people, and the bureau of prisons can handle that.
Compared to the income tax code? Extremely simple.