Thursday, January 12, 2023

So the Republicans Will Get Rid of the Income Tax!

We're in for it now. 

From The Bulwark's Will the House GOP Really Walk the Plank for the Fair Tax?:

The Fair Tax idea has never really had any serious support because it’s not a serious proposal, but a bit of niche talk-radio kitsch from a generation ago. Yet it has become a right of passage for Georgia Republicans to introduce it as the panacea to big government—by means of a federal 23 percent tax inclusive sales tax. (That 23 percent number is misleading—calculated the normal way, the tax exclusive rate is actually 30 percent.) If a federal sales tax were to match current government tax revenues, the actual rate would have to be higher.

Sound regressive? It is! But don’t worry, like any talk-radio proposal, there’s an equally wacky solution to the problems posed by the wacky tax proposal itself: the “prebate,” a monthly check mailed to taxpayers. The Fair Tax organizers frame it this way: “This gives every legal resident household an ‘advance refund’ at the beginning of each month so that purchases made up to the poverty level are tax-free. The prebate prevents an unfair burden on low-income families.”

I know what you’re thinking: Mailing hundreds of millions of checks twelve times a year sounds complicated. But don’t you worry, talk-radio listener, because the big brains behind the Fair Tax have got you covered. . . with a smart card. Per the most recent House version of the bill: “The Social Security Administration may provide rebates in the form of smart cards that carry cash balances in their memory for use in making purchases at retail establishments or by direct electronic deposit.”

Oh, good, the money can go out by electronic deposit. Whew. Who knew that getting rid of the IRS meant turning one annual tax return into twelve opportunities for the federal government to fall down while spraying the American people with a money hose? Cross your fingers!

Bruce Bartlett, the former deputy assistant secretary of the Treasury, eviscerated the Fair Tax in a Wall Street Journal op-ed in 2007, when then-Gov. Mike Huckabee was campaigning on the idea. (Bartlett also wrote an in-depth research paper for Tax Notes, if you care to take a deep dive.) He concluded: “The FairTax is too good to be true, and voters should not take seriously any candidate who supports it.”

And I spent years convincing myself I was too crazy to keep on living, only to be confronted with this as a serious idea from the conservatives who used to tell us the liberals saw the world through rose-tinted glasses and had impractical ideas for running the country? Thankfully, they have only the House.


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