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Strategies & Market Trends : Income Taxes and Record Keeping ( tax ) -- Ignore unavailable to you. Want to Upgrade?

To: Colin Cody who wrote (876)	4/1/1998 12:20:00 AM
From: Kelvin Taylor	Read Replies (2) \| Respond to of 5810

Colin, >Let me re-emphasize, that I am a practicing CPA. I am not here to teach tax evasion. (g) Hmmm...CPA. Someone who has a vested financial interest in keeping the current system. Now I get it. TODAY the State Sales taxes are faced with FRAUD, EMBEZZLEMENT, SKIMMING, SHAM TRANSACTIONS, OUT-OF-STATE SCHEMES, and so on. And that's for a tax rate of 3% to 8%. ADD the NST of say 22% on top of that and the INCENTIVE TO CHEAT will be 500% greater!!! Cheating can go on with or without a single rate tax. Just look at the current system. >Various rates are tossed about. To bring in similar revenues it has been computed that an NST would be far in excess of 20% on retail sales. I disagree. Estimates put the rate at 10 to 15% because more efficient collection (remember went you buy something you pay then and not later). >EXAMPLE: Look at your income. Let's say it is $50,000. Look at your Federal Income taxes, let's say they are $9,000. That's 18% Tax:Gross. Now let's look at WHAT YOU SPEND, RETAIL: Rent $10,000 Food $5,000 Clothing $4,000 Automobile $8,000 Other $6,000 TOTAL $33,000 >Now compare $9,000 (the amount the Fed needs to maintain revenue) to $33,000 and we have an NST rate of 27% You just added the numbers above. NOW calculate the taxes on those expenses and @ 15% taxes = $4950(.15 x 33000) At 27% taxes paid = $8910. That still lower than the $9000 figure. You just proved my point. No income taxes just tax what you buy. The rest is for savings and other taxes. This is an over simplification, but it gets you to the point to understand the 15% to 30% NST rate that we'd see. >SAYS WHO? The 50 States have NOT agreed to this. And NO gov't will ever agree to "what necessary needs" is. Says the government tax bill. Once a national tax rate is passed this would replace the state tax with ONE rate everywhere. Apply it to all sales including mailorder(like some states already do now) and nobody gets by without paying up. Fair, simple and no forms to fill out. >I didn't suggest otherwise. What I STATED was once the Fed cuts back, the STATES, COUNTIES, CITIES and TOWNS will increase their taxes to make up the shortfalls. Maybe so, but I would still rather pay on what I spend than what I earn. And I don't need a CPA to do my taxes. :o) KT P.S. Please believe me that I think CPAs are very highly regarded professionals and provide good service to their clients.