Thursday, March 14, 2013
The Amazing 24-month Deficit Diet!
What would you folks say if I told you I could eliminate the trillion dollar annual federal budget deficits in 24 months? What if I said those ten year deficit reduction plans are silly and un-serious and not grounded in reality?
And, to sweeten the pot, what if I told you that Uncle Sam gets to keep every wasteful government program they now fund....and still achieve balanced annual budgets year after year, without a penny of further government borrowing?
What if I promised that every street prostitute, every drug dealer and every personal and business tax cheat in the nation would finally be paying their fair share of taxes? Sound good?
What if I tell you that you need ever again file a Form 1040 with the IRS? That you need not buy TurboTax or hire a tax preparer to file your taxes? What if I told you that you can stop paying personal income taxes on day 1?
How do I do that?
First of all, I would implement a national sales tax of 15 percent on everything sold in the U.S., except for food or prescription drugs. Further, to offset the undue hardship of this tax falling on the poor, I would rebate all sales taxes paid throughout the year for every family with a gross income below $36,000 per year. I would accomplish this by allowing poor families to submit a "Schedule F" documenting sales tax paid using their sales receipts, and receive a check back from the IRS for all sales taxes paid throughout the year.
Is this a national sales tax a novel idea? No. Former Presidential Candidate, and billionaire business publisher Steve Forbes has advocated for either a flat tax or national sales tax for twenty years! Former Arkansas Governor and Presidential Candidate Mike Huckabee also promoted the idea of a national sales tax.
Why eliminate the income tax in favor of a national sales tax?
In January 2012 the Internal Revenue Service conducted a study on tax fraud. That study revealed that every year the U.S. government fails to collect nearly $400 billion dollars in tax revenue through tax fraud, under reporting or non reporting of taxable income or failing to file taxes at all! However, they offered the caveat that their estimate may be off by a trillion dollars a year in lost revenue.
The IRS now employees 100,000 full time, highly paid government employees at a cost of $12 billion dollars per year. Go with a national sales tax and you could reduce that work force, and the accompanying costs by fully one third. Without having to accomplish costly audits and litigate income tax disputes, without having to conduct tens of millions of tax reviews, the IRS budget could be slashed dramatically!
Upset that American vice is conducted tax free? A sales tax would eliminate that. A tax free "whore" would pay that same fifteen percent that you do every time she buys a tire, a dress, or six inch stiletto heels! The illegal drug trade does hundreds of billions of dollars of business every year in America, and all tax free! A sales tax would insure those wealthy drug dealers would pay out the nose when they bought their Maserati's, or luxury yacht, or Armani suit!
Concerned that 20 million illegal Mexicans may be working for cash under the table and paying no taxes on their income. Ta Da! Instant tax collection every time they bought a six pack of Modello or Dos Equis, or four of those fancy spinning silver rims on their big SUV!
Tens of millions of Americans work for cash, or just refuse to file their taxes and go on without being caught for a decade or more! Slam that 15% sales tax on em and make em pay up like everyone else!
Just imagine Uncle Sam taking in an extra trillion dollars a year in tax revenue, currently lost through fraud! This time next year that annual trillion dollar deficit would be gone! Yes, gone, without having to cut a single wasteful government program!
So why won't the government do it? Well, they've considered it many times. But they can't seemed to think clearly with those 10,000 Washington lobbyists whispering in their ear!
Sad. Damned Sad.