Fair Tax will fix host of financial ills
Tom Minnerick, in the Sept. 2 Daily Herald, notes that it is wrong to claim we benefit from “Made in China.”
When we move production to Red China, the U.S. loses jobs, our companies lose revenue, our government loses tax revenue, etc., while Red China gains funds she uses for her military buildup, which is aimed at the U.S.
All this comes from the “graduated Income Tax,” Karl Marx’s second recommendation. Prohibition of private property ownership is first.
Because the U.S. is the only industrialized country using an income tax as its primary revenue source, our products contain an average 25.9 percent federal tax in their pricing, and the WTO prohibits us from rebating or waiving that tax when we export. Similarly, the WTO prohibits us from applying a tax, comparable to our income tax, to imports.
American companies move their production overseas to compete, so their production can sell here tax-free, too. America is being stripped of production skills, know-how and productive capacity, and we are creating overseas competitors unnecessarily.
The only solution is to pass the Fair Tax, H.R. 25, replacing the income tax with a national retail sales tax, collected by the states. The Fair Tax recognizes that consumers pay all taxes and that the only thing a company can do is pass the tax through to consumers in the prices of its products. American products will be exported tax-free and imports will be subject to the same federal tax as our own products. Our $1.5 trillion trade deficit will disappear.
“Everyone” will pay the 23 percent Fair Tax. This will fund Social Security and Medicare on an actuarially sound basis for the first time — no more “Ponzi scheme.” Ending federal payroll withholding will increase take home pay 30 percent and increase sales, production and employment.
Economists say the growth rate of the economy will jump to between 8 and 12 percent.
The U.S. needs those jobs. The Fair Tax will recover them, quickly, reliably and inexpensively. It is the most thoroughly-researched tax bill ever.
Peter G. Malone
St. Charles