Delay Calls for National Sales Tax to Replace Federal Income Tax

As soon as you start exempting for necessities,you will have Bush's friends insisting that a second house in the Hamptons is a necessity.

Count on it.

 

Getting close, but I can see lots of PC haggling over what is junk food. To many, it's anything except for broccoli. And "used goods" might get sticky too, can we stick to used autos?

I think it may have widespread acceptance...I see Diane is on board, even after the severe harrassment that I have given her.

 

Pa Jim,

You're just like a democrat.

I'll concede everything in the food category if you'll agree that we keep all Used Goods. "If it ain't new - It's used."

No Double Taxation on Used Items!

 

Deal.

 

Done.

 

So a "used" BMW with 3,000 miles on it will be free from tax? Sweet! How about "used" houses? "Used" diamonds? Only a fool would buy anything new (especially as underwear is exempt).

Is there a sales tax on leased items? If not, I can see leasing a car just long enough to make it "used", then either buying it or trading for one just like it.

I imagine there'd be no tax on apartment rentals, unless you'd consider that to be a sale of a service. Only new condos would be taxable, but how would co-ops be treated? The apartment itself is not sold, except originally to the co-op corporation, instead, shares in the corporation are sold - tax-free investment? - with the use of a apartment leased to the shareholder.

Wow, I bet that this would be a tremendous boon for developers. All the materials would be sold business to business tax-free. Labor costs would be down, presumably. If the developer also rented out the property, there'd be no sales tax. Later, if it decided to sell, well, the building has been "used".

Many states and localities have a tax on clothing over $100, so theoretically, you could buy as many $99.95 suits as you wanted, tax-free, but the first $100 suit would be taxed. Nonetheless, I think the tax should be per item, not per purchase - most parents try to buy their kids' school clothes in as few trips as possible. If they were forced to buy one shirt at a time, they'd have to spend a lot of time in line at the register as each member of the family bought an item separately, then had to go back to the end of the line to buy the next item. Things could get ugly.

Finally, I'm curious how all this would be audited. Although bartered goods and services are currently subject to sales tax in many states and localities, when no records are kept, it's extremely difficult to track. There would be a huge incentive to barter and to keep private purchases and services off the books. There would also be a huge incentive to setup fly-by-night corporations which would collect sales taxes and keep them, then close up shop when the Feds come snooping. Black and grey markets will pop up like mushrooms after a rainstorm, I predict.

What I think would actually happen, would be a "transitional" period where we would have both national sales and income taxes - the catch being, of course, that the transition would never be completed and we would always have both.

 

Daisy,

First, you hit the nail on the head with your last paragraph. I pointed out elsewhere that if it is not agreed that the income tax ENDS when the slaes tax BEGINS, we will be stuck with both.

I think that many of your other points are technicalities, and if you think about it your state already has it worked out pretty well at at the state level, so we know it can work.

As to autos, it irks me that you buy a car for $30,000 and pay (f'risntance) $1800 sales tax, and then sell it for $20,000 a few years later and the buyer has to pay $1200 tax all over again. Once it is paid, it should not be paid again on the same item, IMO.

Finally, the most important point...there is no tax system that can shield us from the unfair burden of rampant, out-of-control spenders like GW Bush. Spending must be CUT. BTW, for all you DemoPublicans, CUT means making it lower, i.e. the number next year is mathematically less than the number this year. Seems self-evident, but guys like Bush and Clinton force us to define it.

[ April 01, 2004, 09:16 PM: Message edited by: Gina L ]

 

Yeah, but technicalities = loopholes when it comes to tax codes.

So if you were to say, "Mere technicality", sneaky devils would hear, "Giant, yummy loophole". "Used" or not "used is liable to create a new industry.

New York State doesn't allow too many exemptions and while it may work, I'm not sure it works well. Stores routinely make mistakes, usually in taxing an exempt item.

Food, but not prepared food, is exempt; so if you buy a sardine sandwich at the deli, you're taxed on it, but if you buy a can of sardines, a jar of mayo and a loaf of bread from the same deli you can make multiple sandwiches taxfree. (Is a frozen tv dinner prepared or unprepared?) If this deli is in White Plains, then Albany, White Plains and Westchester County each take their bit of tax. And the counterman who made the sandwich for you is taxed on his income by the State and, if he lives in Yonkers or NYC, from them as well. To top it off, if the deli is in Yonkers, but the counterman lives in NYC, then he is subject to income tax from NYC and non-resident income tax from the City of Yonkers.

Is NYS the only state to put a sales tax on "shipping and handling"?

Whatever isn't subject to sales tax, generally gets a backdoor tax in the way of fees and licensing. Theoretically, a contractor doesn't pay sales tax to the wholesaler, but he has to collect it from the customer as well as pay for his contractor's license annually. My phone bill is subject to tax as well as 911 fees, line fees, mass transit fees, rural people fees, etc. which is about $10 extra.

Rich people get caught occasionally avoiding sales tax by having empty boxes shipped out of state - the law being if something is purchased for use out of state, NY doesn't tax it.

But then, the reverse is also true - anything a New Yorker buys from other states for use in state is taxable by NY. This year for the first time, the State tax form includes Line-56 whereon people can declare the total amount of their out-of-state purchases, particularly online and mail-order, so they can conveniently pay state sales tax on it. (I have no idea what kind of compliance they expect; some surely).

Also, I don't think NY is a good example of what you want, because we have sales & income tax & property tax & town taxes & county taxes & school taxes and sin taxes (taxes slapped on cigarettes & beer & the like) and probably taxes I can't think of right now. So far, we still get air and sunlight tax-free - although the quality may vary depending on location and availability.

 

But, now that I think of it, we don't really get air for free. Gasoline is $.20 - $.40 cheaper in New Jersey because New York requires expensive additives for its Clean Air Initiative.

Dirty air has its own price, but that's for another thread.

 

I really enjoyed living in Montana for 7 years. No Sales Tax on Anything.

Course you got nailed on state income taxes and property taxes.