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Supposn

Federal sales tax.

Should we transform our major federal revenue taxing basis from taxing net incomes to taxing gross general sales transaction?

Advocates of the ďfair taxĒ argue correctly that a general consumption tax is actually the simplest and most equitable method for taxing net incomes. There are methods for drafting sales taxes that could to a very limited extent grant a sales tax a somewhat more progressive characteristic but essentially sales taxes are not progressive or regressive; they simply cannot be as progressive as a progressive tax upon incomes.

I do not concur with many proponents of the fair tax advocating transformation of our major tax revenue sources be done in a single huge step,

Iím a proponent for incrementally and simultaneously decreasing existing income bracketsí tax rates by the same flat percentage of taxable income, deeming an incrementally accumulating amount of annual income to be not subject to income taxes, and incrementally increasing the federal sales tax rate.
Also within each incremental step there should be some additional provisions to better relieve our poor and our working poor.

I do not agree that income taxes should or could be entirely replaced by a general sales tax.
If Iím incorrect, income taxes will be incrementally reduced until they no longer exist; otherwise we will encounter the sales tax approaching an unacceptable rate and further incremental transformation of our major revenue sources will have to be delayed or entirely ceased.

Respectfully, Supposn
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Supposn
The difficulty with taxing annual net incomes is determining what entitiesí actual net incomes. The administrating and enforcing the taxing of those net incomes are highly complex and costly tasks.
The administration, enforcement, their legal drafting of sales taxes are simpler, less costly and are no less effective than the taxing of net incomes.

Sales taxes can only be drafted to grant considerations for lesser earning taxpayers only to a much lesser extent (than is possible when taxing net incomes). But the considerations for lesser earners paying sales taxes can be augmented by government provided services and other considerations which are of greater proportional benefits to each person of lesser income.

Respectfully, Supposn
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