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

To: Kelvin Taylor who wrote (880)	4/1/1998 4:43:00 AM
From: bluejeans	Read Replies (1) \| Respond to of 5810

Your tax proposal is a consumption tax . The current system is an income tax. While I concur that the current system has drawbacks, the switch to a consumption tax may harm many (just like a sales tax cost the poor more than the rich in % terms of their monies). Bob PS. I would be in favor of a more simplified income tax system.

To: Kelvin Taylor who wrote (880)	4/1/1998 10:30:00 AM
From: Colin Cody	Read Replies (1) \| Respond to of 5810

Kelvin, >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. WRONG, you are repeating the flap you were spoon fed. With an NST CPAs, like myself, will find INCREASED BUSINESS, while our clients (high wealth individuals and businesses) will see REDUCED TAX BURDENS, as the lower income people pick up the slack) Low level 1040 preparers, like H&R Block will lose business. Under NST the WEALTHY make out big time, those making under about $100K lose. 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. THEN WE'RE AGREED? You admit you were WRONG AGIAN? Contrary to what you proclaimed earlier - there will be cheaters and TAX FRAUD under the system you support. That's the only point I was making. >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). WHOSE ESTIMATES? Let's see them! The cost of "collection" is nil. The IRS collection system is very profitable when comparing payroll/costs to the amount of unreported income tax recovered. >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. NO, YOU MISSED THE POINT, AND you just PROVED ME CORRECT. 15% times $33,000 only provides about half the revenues the Congress wants. The RATE needs to be DOUBLE that level. The KEY IS NOT HOW THEY COLLECT. THE REAL KEY is how they SPEND IT. The NST, the Flat Tax, are SMOKE SCREENS to confuse the public and obfuscate the ISSUE. The ISSUE is WASTEFUL GOV'T SPENDING. >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. The FED has no authority to dictate to the States or the Local gov't how much $$$ they will assess their residents. The fed has no authority to prohibit the States from Taxing or assessing Fees on Property (Real, Personal, Intangible, Intellectual), earnings (services), passive revenues (capital), head counts, road use, space occupancy, air space usage, land tax, under ground (mineral) tax, or ANY other form used today to generate revenues. 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) MOST people (individuals) do not NEED or USE a CPA to help with their taxes. But if you DO currently, why would an NST stop that? (I really doubt you do use a CPA, based on the mis directed ideas you are posting here) When I do TAX WORK for wealthy individuals NOW it is a FEDERAL 1040 with the various STATES attaching themselves to the Federal computations. The STATES let the Fed do "all the work". There is SOME level of consistency. If the form 1040 went away, we'd have 50 States all making up their own laws with no FED to guide them. The RESULT? A system so complex it would make the 1990s look like high school. CPAs would be in greater demand to work out the taxes. Colin