By Mildred Robertson
April 17th is quickly approaching as Americans gather their pay stubs, calculate their charitable giving and prepare to ante up their annual and much-dreaded payment to the Internal Revenue Service (IRS). Apparently, Republicans profess to feel your pain and want to eliminate the need to file with the IRS. Among their top priorities is to dismantle the IRS and replace it with what they refer to as “The Fair Tax Act”. This proposal would eliminate income, payroll, estate, and gift taxes generally known as a progressive taxing system and would replace them with a 23% national sales tax.
That may sound enticing to some who
dread the annual ritual of calculating taxes and paying up to Uncle Sam. But in reality, this proposal would place a larger burden on the average American.
According to CBS news, The bill, HR25, would eliminate all individual
and corporate income taxes, capital gains, payroll taxes and estate taxes while
imposing a 23% sales tax on goods and services. However, tax experts point out
that the way the tax is calculated, Americans would pay closer to 30% more for everyday purchases.
Without getting too far off in the
weeds, there are several ways to calculate taxes. The Republican plan would
charge the same rate of taxes on everybody for everything. Sounds fair right?
That assumption could not be more mistaken,
at least not in a democratic society. Our
current tax system reduces the tax burden on low-wage earners so that they can afford
essential goods and services, which helps stimulate the economy.
So, what does “The Fair Tax Act” mean
in real life? It means the standard and itemized deductions that reduce your
tax rate would be eliminated.
John Buhl, a researcher at the Tax
Policy Center says many Americans, particularly those in the middle class, will
see a sizable increase in their tax burden. While lower-income households could benefit
from what he calls “prebates”, depending on family size and income, the
wealthiest of the wealthy would be the primary benefactors of the Republican
plan.
The regressive Republican tax proposal
would increase the tax burden for essential goods and services on low-income
taxpayers who could least afford to pay it, while high-income taxpayers would bear
a relatively small tax burden. Ultimately the greatest burden would fall
on moderate- to low-income households, causing them to spend a much higher
percentage of their income on essential items necessary to survive.
While our current tax system
buffers the cost for low- and moderate-income households, the regressive tax
system proposed by Republicans would lessen the burden on high-income
households while shifting the burden to those least able to bear the cost.
If you believe in a fair and
equitable system of taxation, contact your representative to learn more about “The
Fair Tax Act.” See how it will personally affect you and others like you.
Encourage them to vote for an equitable system of taxation that will provide
for our nation’s needs while allowing average Americans to fairly contribute to
this nation’s upkeep without depriving them of the income necessary to sustain their
households.
To find your representative go to: https://www.house.gov/representatives/find-your-representative,
or call the House switchboard at 202-224-3121.