1% Tax?

[AceNZ]

Yes it is likely we will be paying the same amount in prices, except the payment of taxes will be distributed more evenly, instead of the consumer just paying the brunt of the taxes, the companies would have to pay that 1% everytime they paid for a good or service to produce the product you're only paying the 1% on. So prices would remain the same, but you would split the tax burden with the manufacturer. (As I understand it).

No, we will paying the same amount in TAXES. Prices would have to go up substantially as a result.

Remember that there really isn't any such thing as a "company". Companies are all owned by people -- directly or indirectly as shareholders. Penalizing companies with additional taxes is exactly the opposite of what the economy needs. As an example of where this would hurt, did you know that profits of larger grocery store chains are only on the order of 1% of total sales? So to implement this tax they would basically end up paying a 100% tax? Of course they would pass it off to consumers, but it's pretty much the same thing.

Someone said the Cato Institute signed off on this? Hard to believe.

 

[AlexMerced]

they said Cato AND Mises signed off on this

I think the logic is 1% goes under the radar per transaction, and honestly I don't know if thy'd bother to raise prices for 1%

 

[silverlegacy]

You would actually pay less in taxes on average. This is because as the money floats into the economy (the extra that people/companies have) that will raise more jobs and higher incomes. Then, that money will be used to buy things and will be taxed again. More jobs and wages, with more people buying means same revenue with less impact. And people will save more money as they will have more laying around that isn't taxed. Say the rate went to 18%, and I know I don't spend half of my income in stores so that would lower the tax to below 10%. Remember you wouldn't be taxed to make car payments, house payments, gold, 401k etc, and if this was properly run you would get a rebate on big ticket items making it about 7-11% sales tax on anything above a certain amount. Or like Australia does and for your first house you don't pay the tax.

This is a much better idea than an income tax and much more plausible than getting rid of the income tax. It would help all Americans.

 

[AlexMerced]

Yeah, plus if ROn Paul cut the spending the way he'd like we can make this .6% tax

also this tax is so low it'd be nick and diming in a big way, similar to those credit cards fee no one notices yet steals 1000s of dollars from us each year.

 

[silverlegacy]

The best thing about a total sales tax, at least in my mind, it that it can be mostly avoided.

 

[spudea]

i like how it would hit every player in the economy equally. Even foreigners who come and spend money here would get hit with it. Illegal aliens can't get around it. It would generate a ton of revenue, and would be necessary as we take care of those dependant on our current welfare systems. And after Ron Paul gets our houses in order, we can phase it out.

 

[AlexMerced]

yeah, this 1% tax sounds awesome

 

[NaT805]

also this tax is so low it'd be nick and diming in a big way, similar to those credit cards fee no one notices yet steals 1000s of dollars from us each year.

That is a good example, it just nickel and dimes every transaction, and since there will be tons of transactions....lots of revenue!

Haha like office space...

 

[AceNZ]

I think the logic is 1% goes under the radar per transaction, and honestly I don't know if thy'd bother to raise prices for 1%

Some large businesses operate on profit margins on the order of only 1%. They would raise prices, because if they didn't, they'd go out of business.

 

[Goldwater Conservative]

He described it as a VAT, which has the same effect as a sales tax (and is harder to avoid, although much of the actual tax is hidden in the price), so I doubt it could raise the same level of revenue at a 1% rate. A pure VAT would need to be closer to 20% to keep revenue the same. If he meant it would tax total value, not just value-added, at each stage of production, then that would have a cascading effect which would put industries with multiple stages of production at an unfair disadvantage.

I agree with AceNZ that a uniform tariff would be the best way to fund the federal government.

 

[AceNZ]

they said Cato AND Mises signed off on this

OK, I'm calling BS on this. Unless someone can produce a high-quality link (blogs don't count) from Cato and Mises, I don't believe they endorsed it as claimed. I've seen writeups where they support something along the lines of a national sales tax, but that's nothing like this. The idea as described by taxpayersassociation.us is extremely unsound from a financial perspective.

 

[AlexMerced]

OK, I'm calling BS on this. Unless someone can produce a high-quality link (blogs don't count) from Cato and Mises, I don't believe they endorsed it as claimed. I've seen writeups where they support something along the lines of a national sales tax, but that's nothing like this. The idea as described by taxpayersassociation.us is extremely unsound from a financial perspective.

lol, I know I've been looking for this too, I was taken back when Mark Larsen made a claim that they both took a look at this and have been trying to find what he read.