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Regardless of who you ask, most people will probably tell you that they are being overtaxed. Of course, we would all love to take a bitter share home. Who wouldn't?
 
During the tax season I farm myself out to a firm that reviews tax returns. The people who complain the most that they aren't getting enough are those who pay nothing and actually get "refundable" credits, which means they get refunds of money they never paid. And they want to know why they don't get more.<p>


This is the truth and it doesn't matter whether or not you want to believe it. It is still the truth.<p>


That which the government subsidizes, increases. That which the government taxes, decreases.
 
> That which the government subsidizes, increases. That which the government taxes, decreases.





That's one of the reasons I support a consumption tax instead of an income tax. The average American saves next to nothing. Of course, we tax interest income, dividends, and capital gains.





Why not give people a reason to save their money?
 
I am on the Alan Keyes bandwagon. Consumption tax instead of income tax. This will tax rich people more because they buy more things. More expensive things.
 
If you care about average Americans saving money, you should have supported Romney - he was advocating 0% capital gain for incomes up to $200k. I doubt a consumption tax would encourage savings.
 
<em> I doubt a consumption tax would encourage savings.





</em>Are you serious? When people pay a 25% sales tax instead of a 4-8% sales tax, they will think a little before spending. The people will control how much money they give to the government, or how much they save. Anyone who has ever been paid wage + commission or mostly commission knows that a 52% withholding rate sucks.
 
Liz, not only that, but people change their economic behavior when there is a chance to keep more of what they earn. If you eliminated penalties for saving/investing and went to a consumption tax, people would quickly learn about the magic of compound interest.
 
Given how people love to live on credit, the more likely scenario is people will just blow that money away sooner. Paying 25% interest doesn't seem to stop them right now. I agree that ideally it would shift away the focus from a consumption society. I just doubt it would be the case.
 
<p>green, </p>

<p>In 1991 a 10% excise tax went into effect on luxury boats costing more than $100k. Sales plummeted and an entire industry was nearly destroyed because the "rich" decided not to buy new pleasure craft. What you fail to understand is that a tax adds to the cost at purchase, while interest paid on a CC balance only adds a small amount to the minimum monthly payment. One is in your face, the other can be ignored indefinetely. People living beyond their means use credit cards to finance that lifestyle, while the truly wealthy never let a balance roll over. I know it's hard to get past the class envy from which you clearly suffer, but do try; clear thinking leads to better opportunites to become sucessful while emotional thinking gets you nothing but resentment, bitterness, and pity.</p>

<p>That's no way to live.</p>
 
I'm not describing how I would behave - only speculating on how the average person would behave. After all, the median income in the US in not that high. The average savings rate in the US in currently negative. You are trying to influence the behavior of the population as a whole. Those that are reasonable would find the consumption tax as a great vehicle to focus more on investments. Those that live pay check to pay check or are living beyond their means might not see it as such.





You might perceive my comments as class envy but that is not where I'm coming from. My concern is that these theories rely on reasonable consumers. I would say most people on this board fall in this category. But does most of the country? Call me elitist if you will, but the average person when left to their own devices tends to screw up a lot.
 
<p><em>"the average person when left to their own devices tends to screw up a lot."</em></p>

<p>Yes, which is how credit card companies make so much money. If consumers as a whole acted responsibly we would have a much different country, but businesses exist to exchange their stuff for your cash so in order to encourage responsible action you have to force a moment of reflection prior to action. Tacking on an extra 25% to that flat screen might do that where a bill arriving a month later will not. If you want to make certain they pause, make it illegal to finance any taxes into purchases so that regardless of the awesome 0% introductory-rate credit card or no-payments-till-2100 in-house financing offer, they have to plunk down that 25% tax before they leave Best Buy with the latest and greatest toy.</p>

<p>Personally, I don't want to save fools from their folly. They need to learn from their mistakes or they will remain fools. I just want to reduce the amount of money the government gets while increasing the amount of money we get. As it stands today, our government creates debt to sell to ourselves and others, takes money from us to conduct it's own business and service the interest on that debt, returns any overpayment on it's own schedule and without interest, and arbitrarily creates more "money" as needed to meet it's own demand. In the name of war and social services we have not only spent the entire trust fund created by social security, but we now have almost TEN TRILLION DOLLARS that we owe to others. And all for what? We still have poor people, sick people, homeless people, hungry people, people who hate other people both for what they look like and what they have, and guess what else...we still can't stop a few determined people from killing our citizens domestically, internationally, intergalactically. And yet:</p>

<p><em>As president, Obama will work to ensure that low-income Americans have transportation access to jobs. Obama will double the federal Jobs Access and Reverse Commute program to ensure that additional federal public transportation dollars flow to the highest-need communities and that urban planning initiatives take this aspect of transportation policy into account. - Obama</em></p>

<p><em>Hillary will increase federal investment in public transit by $1.5 billion per year to ensure needed capacity expansions and service level improvements. - Clinton</em></p>

<p><em>We must continue subsidies because our farmers compete with highly subsidized farmers in Europe and Asia, and they face fixed costs (land, equipment, seed, supplies) whether or not they produce a crop. Subsidies insulate farmers from natural disasters like droughts, floods, hurricanes, and tornadoes, as well as from sudden spikes in the price of fuel, feed, and fertilizer. - Huckabee</em></p>

<p><em>John McCain believes that the answer to these challenges is not to roll back our overseas commitments. The size and composition of our armed forces must be matched to our nation's defense requirements. As requirements expand in the global war on terrorism so must our Army, Navy, Air Force, Marines, and Coast Guard be reconfigured to meet these new challenges. John McCain thinks it is especially important to increase the size of the Army and Marine Corps to defend against the threats we face today. -McCain</em></p>

<p>It's enough to make one wonder "why bother?"</p>
 
To be fair, about half of the national debt is in the form of debits and credits that various Federal government agencies hold amongst themselves. Can you really call it debt if the Library of Congress owes the National Archives money for services rendered?





Also, I'm certainly NOT a John McCain fan ( I voted for him in 1986 and vowed to never repeat that mistake. ), but of the four quotes you provided, at least one of them is related to something that the Federal government is authorized by the Constitution to engage in. It's a shame that the 10th amendment is so widely ignored.
 
We need to start a new movement. Alternative Maximum Tax. It works similar to Prop 13. The government, fed and state can only tax us up to $1 million per lifetime, and no more than 2% increase after that on an annual basis. Sales tax and other consumption tax can continue.



This way everyone has the opportunity to pay the same tax over their lifetime. The government knows that we have 360 million people, the max they can spend is 360 mill X 1 million = 360 Trillion divided over avg life span of 75 years. So if they want more money, have more people by expanding the birthrate or legal immigration. Think about how motivated people would be to pay the tax and be done with it. Also think of all the rich foreigners who would love to come here.



This will also help reduce inflation to nil, because if the govt inflates, the million dollars of tax paid today would be worth $100K in 30 years.
 
<p>awgee </p>

<p>Do the FEDs issue a 1099 for the year that a person receives a rebate? I think I remember this from the last rebate. </p>

<p>If so then the rebate is actually net of the tax liability correct? </p>

<p>Thanks</p>
 
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