[POLL] - Liberals, how much is a "fair share?" - Taxes

[Polk]

A sales taxes with no deductions would, even under the most favorable estimates, have to be north of 30% to be revenue neutral.

Your came from?

It's irrelevant anyway because those taxes are already baked into the price of the product. If the actual amount is 30%, it's just an admission that taxes are higher than the left admit. Whatever the rate is, if it's revenue neutral, the price of products won't go up.

And they will go down over time as waste and the infrastructure to collect all the different taxes, counter incentives, disincentives and the rest of the monstrous infrastructure to tax the same money over and over are dismantled.

Sales tax proponents always make that argument, but basic math doesn't support it. If the cost of the tax were already baked in to goods, revenue would be significantly higher than it actually is.

 

[thereisnospoon]

A sales taxes with no deductions would, even under the most favorable estimates, have to be north of 30% to be revenue neutral.

Your came from?

The "FairTax" organization's headline number is 30%. Other studies (such as Bush's Advisory Panel on Federal Tax Reform) found higher rates, and even that assumed no evasion.

Ok...How about a link.
Never mind...factcheck.org is a wonderful thing!
FactCheck.org: Unspinning the FairTax

 

[Foxfyre]

Your came from?

It's irrelevant anyway because those taxes are already baked into the price of the product. If the actual amount is 30%, it's just an admission that taxes are higher than the left admit. Whatever the rate is, if it's revenue neutral, the price of products won't go up.

And they will go down over time as waste and the infrastructure to collect all the different taxes, counter incentives, disincentives and the rest of the monstrous infrastructure to tax the same money over and over are dismantled.

Sales tax proponents always make that argument, but basic math doesn't support it. If the cost of the tax were already baked in to goods, revenue would be significantly higher than it actually is.

Basic math DOES support it. I spent four hard-working hours, calculator in hand, in with Fair Tax proponents explained how it worked. And starting out it indeed would be far simpler and less oppressive than the income tax. And the top rate paid by anybody would be less than 30%.

The downside is that those teaching the workshop could not explain, to my satisfaction, concepts of value added to products during their development on the way to market, the problem with determining who was eligible for what prebate, and dickering with the system by Congress that could eventually create a tax code more nightmarish than the one we have or worse.

14.Is it fair for rich people to get the exact same FairTax prebate from the federal government as the poorest person in America?

Let’s look at a billionaire under the FairTax -- if he spends $10,000,000 dollars he pays a tax of $2,300,000 and gets a prebate of $4,697 (assuming he is married and has no children). His effective tax rate as a percent of spending is 22.95 percent.

Now, let’s look at a middle-income married couple with no children under the FairTax -- if they spend $50,000, they pay $6,803 net of their prebate for an effective tax rate of 13.6 percent. The effective tax rate increases as spending increases, but never exceeds 23 percent!
Frequently Asked Questions Answers - Americans For Fair Taxation

After looking at it I have not completely dismissed the Fair Tax concept, but I am still leaning toward a truly flat income tax with everybody having some skin in the game and nobody being exempt.

 

[kaz]

Your came from?

It's irrelevant anyway because those taxes are already baked into the price of the product. If the actual amount is 30%, it's just an admission that taxes are higher than the left admit. Whatever the rate is, if it's revenue neutral, the price of products won't go up.

And they will go down over time as waste and the infrastructure to collect all the different taxes, counter incentives, disincentives and the rest of the monstrous infrastructure to tax the same money over and over are dismantled.

Sales tax proponents always make that argument, but basic math doesn't support it. If the cost of the tax were already baked in to goods, revenue would be significantly higher than it actually is.

As an undergraduate math major and an MBA, I don't have any idea what you just said. What does that mean "revenue would be significantly higher?"

As for the Fair Tax, basic logic supports it. All taxes are already baked into the price of products we buy today other than the death tax. For a revenue neutral level, if you remove a bucket of water from a pool and put a bucket of water into the pool, you end up with the same amount of water in the pool.

BTW, the difference in your discussion on the tax rates is really perspective. According to the fair tax analysis, you can look at the sales tax either as 23% or 30%, it's how you measure it, it's the same.

If you measure it like a sales tax (meaning added to the price of a product), it's 30%. If you measure it like an income tax (taken out of the price of the product), it's 23%. But the $ amount of the tax taken for the item doesn't change which ever way you look at it.

 

[RKMBrown]

It's irrelevant anyway because those taxes are already baked into the price of the product. If the actual amount is 30%, it's just an admission that taxes are higher than the left admit. Whatever the rate is, if it's revenue neutral, the price of products won't go up.

And they will go down over time as waste and the infrastructure to collect all the different taxes, counter incentives, disincentives and the rest of the monstrous infrastructure to tax the same money over and over are dismantled.

Sales tax proponents always make that argument, but basic math doesn't support it. If the cost of the tax were already baked in to goods, revenue would be significantly higher than it actually is.

Basic math DOES support it. I spent four hard-working hours, calculator in hand, in with Fair Tax proponents explained how it worked. And starting out it indeed would be far simpler and less oppressive than the income tax. And the top rate paid by anybody would be less than 30%.

The downside is that those teaching the workshop could not explain, to my satisfaction, concepts of value added to products during their development on the way to market, the problem with determining who was eligible for what prebate, and dickering with the system by Congress that could eventually create a tax code more nightmarish than the one we have or worse.

14.Is it fair for rich people to get the exact same FairTax prebate from the federal government as the poorest person in America?

Let’s look at a billionaire under the FairTax -- if he spends $10,000,000 dollars he pays a tax of $2,300,000 and gets a prebate of $4,697 (assuming he is married and has no children). His effective tax rate as a percent of spending is 22.95 percent.

Now, let’s look at a middle-income married couple with no children under the FairTax -- if they spend $50,000, they pay $6,803 net of their prebate for an effective tax rate of 13.6 percent. The effective tax rate increases as spending increases, but never exceeds 23 percent!
Frequently Asked Questions Answers - Americans For Fair Taxation

After looking at it I have not completely dismissed the Fair Tax concept, but I am still leaning toward a truly flat income tax with everybody having some skin in the game and nobody being exempt.

I'm still leaning sales and property tax collected by the states with additional import/export duties per any measured trade imbalance.

 

[kaz]

After looking at it I have not completely dismissed the Fair Tax concept, but I am still leaning toward a truly flat income tax with everybody having some skin in the game and nobody being exempt.

A flat tax still provides the IRS with their gestapo powers over the people and their tool for endless invasion into our privacy to ensure we are paying our "fair" share.

Also, since other than the death tax, all prices are baked into the price of products we buy anyway, it's directly taxing that which is taxed, which is clearly the most efficient. Why measure "income" and then tax it when in the end, it's all the same and you could have just taxed the transaction directly? The flat tax may be flat for consumers, but you're still taxing economic transactions arbitrarily. The Fair Tax is the flat tax further flattened.

 

[Uncensored2008]

The "FairTax" organization's headline number is 30%. Other studies (such as Bush's Advisory Panel on Federal Tax Reform) found higher rates, and even that assumed no evasion.

The Fair Tax is not a sales tax; you are mixing apples and machine screws. Further, sales tax is difficult to the point of nearly impossible, to evade. This is why the left opposes such a measure - impossible to use the tax code to favor cronies with a sales and use tax.

 

[Foxfyre]

After looking at it I have not completely dismissed the Fair Tax concept, but I am still leaning toward a truly flat income tax with everybody having some skin in the game and nobody being exempt.

A flat tax still provides the IRS with their gestapo powers over the people and their tool for endless invasion into our privacy to ensure we are paying our "fair" share.

Also, since other than the death tax, all prices are baked into the price of products we buy anyway, it's directly taxing that which is taxed, which is clearly the most efficient. Why measure "income" and then tax it when in the end, it's all the same and you could have just taxed the transaction directly? The flat tax may be flat for consumers, but you're still taxing economic transactions arbitrarily. The Fair Tax is the flat tax further flattened.

I know that's the argument. But I have just enough accounting, auditing, and tax skills to know how books are cooked and how cheaters rig things and get around thngs. And a Fair Tax gives us no more protection against government gerrymandering the system or practicing gestapo tactics than does an income tax. And it is way too easy to hide little manipulations of the system and for little manipulations to not be immediately obvious.

The beauty of the flat income tax is that everybody will pay it with no way to 'help' or 'benefit' one group without helping or benefitting all - at least without being completely obvious. And any changes or extortionary tactics also affect those the government depends on to vote for them or keep them in power and will be immediately noticable on their pay stubs.

 

[kaz]

After looking at it I have not completely dismissed the Fair Tax concept, but I am still leaning toward a truly flat income tax with everybody having some skin in the game and nobody being exempt.

A flat tax still provides the IRS with their gestapo powers over the people and their tool for endless invasion into our privacy to ensure we are paying our "fair" share.

Also, since other than the death tax, all prices are baked into the price of products we buy anyway, it's directly taxing that which is taxed, which is clearly the most efficient. Why measure "income" and then tax it when in the end, it's all the same and you could have just taxed the transaction directly? The flat tax may be flat for consumers, but you're still taxing economic transactions arbitrarily. The Fair Tax is the flat tax further flattened.

I know that's the argument. But I have just enough accounting, auditing, and tax skills to know how books are cooked and how cheaters rig things and get around thngs. And a Fair Tax gives us no more protection against government gerrymandering the system or practicing gestapo tactics than does an income tax. And it is way too easy to hide little manipulations of the system and for little manipulations to not be immediately obvious.

The beauty of the flat income tax is that everybody will pay it with no way to 'help' or 'benefit' one group without helping or benefitting all - at least without being completely obvious. And any changes or extortionary tactics also affect those the government depends on to vote for them or keep them in power and will be immediately noticable on their pay stubs.

That makes no sense to me. With my P&L, which is what feeds my business tax forms, I have endless options to do the things you're saying. With the sales tax, which would be the same way the Fair Tax would be calculated, I have almost none. I can move invoices or payments a bit between months, but that's only a slight delay in paying taxes and doesn't change the amount I pay. That's about it.

As for the income tax, the only people what you are saying would be true for are W-2 employees. Everyone else would have endless opportunities. And cash employees would be able to skirt taxes just like they do now. The Fair Tax makes all of them as well as illegal aliens taxpayers.

 

[Foxfyre]

A flat tax still provides the IRS with their gestapo powers over the people and their tool for endless invasion into our privacy to ensure we are paying our "fair" share.

Also, since other than the death tax, all prices are baked into the price of products we buy anyway, it's directly taxing that which is taxed, which is clearly the most efficient. Why measure "income" and then tax it when in the end, it's all the same and you could have just taxed the transaction directly? The flat tax may be flat for consumers, but you're still taxing economic transactions arbitrarily. The Fair Tax is the flat tax further flattened.

I know that's the argument. But I have just enough accounting, auditing, and tax skills to know how books are cooked and how cheaters rig things and get around thngs. And a Fair Tax gives us no more protection against government gerrymandering the system or practicing gestapo tactics than does an income tax. And it is way too easy to hide little manipulations of the system and for little manipulations to not be immediately obvious.

The beauty of the flat income tax is that everybody will pay it with no way to 'help' or 'benefit' one group without helping or benefitting all - at least without being completely obvious. And any changes or extortionary tactics also affect those the government depends on to vote for them or keep them in power and will be immediately noticable on their pay stubs.

That makes no sense to me. With my P&L, which is what feeds my business tax forms, I have endless options to do the things you're saying. With the sales tax, which would be the same way the Fair Tax would be calculated, I have almost none. I can move invoices or payments a bit between months, but that's only a slight delay in paying taxes and doesn't change the amount I pay. That's about it.

As for the income tax, the only people what you are saying would be true for are W-2 employees. Everyone else would have endless opportunities. And cash employees would be able to skirt taxes just like they do now. The Fair Tax makes all of them as well as illegal aliens taxpayers.

Really I'm not arguing with you, or that is not my intent. I want the flattest, fairest, simplest, and most difficult to manipulate tax system. And I'm not dogmatic on the best way to get there. I just don't want us to not consider ALL the possible drawbacks, pitfalls, and unintended consequences before we change the system. Right now I see far more unintended consequences, and much more opportunity for politicians to manipulate the system with a Fair Tax than a flat income tax.

And as for consequences, it's those folks getting those W-2s who most need to be educated and made aware. Those of us who are independent contractors or otherwise self employed, already ARE aware. The dishonest among us are always figuring out ways to screw with the system. The honest among us do the best we can to minimize the damage.

The one other consequence of going to a Fair Tax system that I haven't been able to get anybody to answer--not Huckabee, not the FairTax.org folks, not anybody--is how to do the transition. Mr. Foxfyre and I are recently retired and are living almost exclusively on money we have already paid tax on when we earned it. How does the Fair Tax get around taxing it again when we now spend it?

 

[Skull Pilot]

Back in the 1950s, when the top marginal tax rate was more than 90 percent, real annual growth averaged more than 4 percent. During the last eight years, when the top marginal rate was just 35 percent, real growth was less than half that. Altogether, in years when the top marginal rate was lower than 39.6 percent — the top rate during the 1990s — annual real growth averaged 2.1 percent. In years when the rate was 39.6 percent or higher, real growth averaged 3.8 percent. The pattern is the same regardless of threshold. Take 50 percent, for example. Growth in years when the tax rate was less than 50 percent averaged 2.7 percent. In years with tax rates at or more than 50 percent, growth was 3.7 percent.


CHART: Since 1950, Lower Top Tax Rates Have Coincided With Weaker Economic Growth | ThinkProgress

When the top rate was in the 90% range the bottom rate was also much higher.

In 1951 those earning 20K a year were in the 39% bracket so be careful what you wish for.

 

[Foxfyre]

There is one other aspect of the Fair Tax I wonder if its advocates have thought through.

If you live in a border state - Texas, New Mexico, Arizona, California, Washington, Idaho, Montana, Michigan, New York, Vermont, New Hampshire, Maine, you have a whole lot of folks living within driving distance of countries who might offer lower taxes. And in this internet driven world, I could see a large upsurge in ordering a lot of merchandise from other places when the shipping would be less than the taxes if the stuff was bought at home.

Perhaps not really a problem. Just something I have been thinking about as I try to find a system that makes most sense to me.

 

[kaz]

The one other consequence of going to a Fair Tax system that I haven't been able to get anybody to answer--not Huckabee, not the FairTax.org folks, not anybody--is how to do the transition. Mr. Foxfyre and I are recently retired and are living almost exclusively on money we have already paid tax on when we earned it. How does the Fair Tax get around taxing it again when we now spend it?

I didn't take it as "arguing," just responding to your points. I'm more "passionate' in my arguments then you, but in the end we both are focused on the points made, which is what i like about debating you. I find it sad but can't solve that most of the debates on this and every political site are mostly bickering with idiotic liberals making the same inane points when there are far more interesting issues to delve into.

As for your question, you have to go back to that you're paying it now anyway. There is no transition to be done. All the company's business taxes you bought from, the income tax for all their employees, employer and employee payroll taxes, unemployment taxes, capital gains taxes, taxes on debt payments and all the rest except for the death taxes are built into the price of what you are buying already just like the price of the steel and bricks they are made out of.

The price of products will not go up to be revenue neutral. And they will actually drop as all the tax inefficiencies are eliminated.

 

[Polk]

It's irrelevant anyway because those taxes are already baked into the price of the product. If the actual amount is 30%, it's just an admission that taxes are higher than the left admit. Whatever the rate is, if it's revenue neutral, the price of products won't go up.

And they will go down over time as waste and the infrastructure to collect all the different taxes, counter incentives, disincentives and the rest of the monstrous infrastructure to tax the same money over and over are dismantled.

Sales tax proponents always make that argument, but basic math doesn't support it. If the cost of the tax were already baked in to goods, revenue would be significantly higher than it actually is.

As an undergraduate math major and an MBA, I don't have any idea what you just said. What does that mean "revenue would be significantly higher?"

As for the Fair Tax, basic logic supports it. All taxes are already baked into the price of products we buy today other than the death tax. For a revenue neutral level, if you remove a bucket of water from a pool and put a bucket of water into the pool, you end up with the same amount of water in the pool.

BTW, the difference in your discussion on the tax rates is really perspective. According to the fair tax analysis, you can look at the sales tax either as 23% or 30%, it's how you measure it, it's the same.

If you measure it like a sales tax (meaning added to the price of a product), it's 30%. If you measure it like an income tax (taken out of the price of the product), it's 23%. But the $ amount of the tax taken for the item doesn't change which ever way you look at it.

I really don't get which part was so challenging for you. If what you were saying was true, revenues would be higher than they are today. Since you were a "math major", we'll put it in equation form.

If what you claimed was true, revenues today would be X + Y, where X = current revenues and Y > 0.

If you take the claims of the "FairTaxers" at face value, they're claiming everyone gets a tax cut, but that revenue would remain the same. That's simply not possible with a big magical asterisk.

As a conceptual matter, the rate is a matter of "how you look at it", but 30% is the only honest way to frame. The public thinks of sales taxes as the percentage added, not the percentage of the total. Quoting the rate as 23% is a bit of sophistry designed to mislead the public. Then again, that's the whole point.

 

[Polk]

The "FairTax" organization's headline number is 30%. Other studies (such as Bush's Advisory Panel on Federal Tax Reform) found higher rates, and even that assumed no evasion.

The Fair Tax is not a sales tax; you are mixing apples and machine screws. Further, sales tax is difficult to the point of nearly impossible, to evade. This is why the left opposes such a measure - impossible to use the tax code to favor cronies with a sales and use tax.

Someone should tell the "FairTax" people then, since they don't agree.

What is taxed?

The FairTax is a single-rate, federal retail sales tax collected only once, at the final point of purchase of new goods and services for personal consumption. Used items are not taxed. Business-to-business purchases for the production of goods and services are not taxed. A rebate makes the effective rate progressive.

Frequently Asked Questions Answers - Americans For Fair Taxation

 

[Polk]

I know that's the argument. But I have just enough accounting, auditing, and tax skills to know how books are cooked and how cheaters rig things and get around thngs. And a Fair Tax gives us no more protection against government gerrymandering the system or practicing gestapo tactics than does an income tax. And it is way too easy to hide little manipulations of the system and for little manipulations to not be immediately obvious.

The beauty of the flat income tax is that everybody will pay it with no way to 'help' or 'benefit' one group without helping or benefitting all - at least without being completely obvious. And any changes or extortionary tactics also affect those the government depends on to vote for them or keep them in power and will be immediately noticable on their pay stubs.

That makes no sense to me. With my P&L, which is what feeds my business tax forms, I have endless options to do the things you're saying. With the sales tax, which would be the same way the Fair Tax would be calculated, I have almost none. I can move invoices or payments a bit between months, but that's only a slight delay in paying taxes and doesn't change the amount I pay. That's about it.

As for the income tax, the only people what you are saying would be true for are W-2 employees. Everyone else would have endless opportunities. And cash employees would be able to skirt taxes just like they do now. The Fair Tax makes all of them as well as illegal aliens taxpayers.

Really I'm not arguing with you, or that is not my intent. I want the flattest, fairest, simplest, and most difficult to manipulate tax system. And I'm not dogmatic on the best way to get there. I just don't want us to not consider ALL the possible drawbacks, pitfalls, and unintended consequences before we change the system. Right now I see far more unintended consequences, and much more opportunity for politicians to manipulate the system with a Fair Tax than a flat income tax.

And as for consequences, it's those folks getting those W-2s who most need to be educated and made aware. Those of us who are independent contractors or otherwise self employed, already ARE aware. The dishonest among us are always figuring out ways to screw with the system. The honest among us do the best we can to minimize the damage.

The one other consequence of going to a Fair Tax system that I haven't been able to get anybody to answer--not Huckabee, not the FairTax.org folks, not anybody--is how to do the transition. Mr. Foxfyre and I are recently retired and are living almost exclusively on money we have already paid tax on when we earned it. How does the Fair Tax get around taxing it again when we now spend it?

When you say you want a flat income tax, do you mean a flat rate on wages or on all income?

 

[Polk]

There is one other aspect of the Fair Tax I wonder if its advocates have thought through.

If you live in a border state - Texas, New Mexico, Arizona, California, Washington, Idaho, Montana, Michigan, New York, Vermont, New Hampshire, Maine, you have a whole lot of folks living within driving distance of countries who might offer lower taxes. And in this internet driven world, I could see a large upsurge in ordering a lot of merchandise from other places when the shipping would be less than the taxes if the stuff was bought at home.

Perhaps not really a problem. Just something I have been thinking about as I try to find a system that makes most sense to me.

It's pretty clear I'm not in favor of a "FairTax", but that's a pretty easy problem to fix. It would just be part of the border crossing/customs process.

 

[Foxfyre]

The one other consequence of going to a Fair Tax system that I haven't been able to get anybody to answer--not Huckabee, not the FairTax.org folks, not anybody--is how to do the transition. Mr. Foxfyre and I are recently retired and are living almost exclusively on money we have already paid tax on when we earned it. How does the Fair Tax get around taxing it again when we now spend it?

I didn't take it as "arguing," just responding to your points. I'm more "passionate' in my arguments then you, but in the end we both are focused on the points made, which is what i like about debating you. I find it sad but can't solve that most of the debates on this and every political site are mostly bickering with idiotic liberals making the same inane points when there are far more interesting issues to delve into.

As for your question, you have to go back to that you're paying it now anyway. There is no transition to be done. All the company's business taxes you bought from, the income tax for all their employees, employer and employee payroll taxes, unemployment taxes, capital gains taxes, taxes on debt payments and all the rest except for the death taxes are built into the price of what you are buying already just like the price of the steel and bricks they are made out of.

The price of products will not go up to be revenue neutral. And they will actually drop as all the tax inefficiencies are eliminated.

Now wait a minute. Currently the gross receipts tax on a loaf of bread in Albuquerque is 7%. The bread retails for about $1.25 plus tax or $1.34 at check out.

Now then, if all things remain the same, a flat tax would impose a 13% tax on that loaf of bread.

$1.25 plus 9 cents local gross receipts tax plus 17 cents fair tax = $1.51 for that same loaf of bread. You're telling me that the base cost of that loaf of bread will be reduced by at least 17 cents because of tax savings in the production, wholesale, and retail process?

Otherwise I will be taxed again on the money I use that was already taxed--quite heavily I might add--when I earned it.

 

[Polk]

The one other consequence of going to a Fair Tax system that I haven't been able to get anybody to answer--not Huckabee, not the FairTax.org folks, not anybody--is how to do the transition. Mr. Foxfyre and I are recently retired and are living almost exclusively on money we have already paid tax on when we earned it. How does the Fair Tax get around taxing it again when we now spend it?

I didn't take it as "arguing," just responding to your points. I'm more "passionate' in my arguments then you, but in the end we both are focused on the points made, which is what i like about debating you. I find it sad but can't solve that most of the debates on this and every political site are mostly bickering with idiotic liberals making the same inane points when there are far more interesting issues to delve into.

As for your question, you have to go back to that you're paying it now anyway. There is no transition to be done. All the company's business taxes you bought from, the income tax for all their employees, employer and employee payroll taxes, unemployment taxes, capital gains taxes, taxes on debt payments and all the rest except for the death taxes are built into the price of what you are buying already just like the price of the steel and bricks they are made out of.

The price of products will not go up to be revenue neutral. And they will actually drop as all the tax inefficiencies are eliminated.

Now wait a minute. Currently the gross receipts tax on a loaf of bread in Albuquerque is 7%. The bread retails for about $1.25 plus tax or $1.34 at check out.

Now then, if all things remain the same, a flat tax would impose a 13% tax on that loaf of bread.

$1.25 plus 9 cents local gross receipts tax plus 17 cents fair tax = $1.51 for that same loaf of bread. You're telling me that the base cost of that loaf of bread will be reduced by at least 17 cents because of tax savings in the production, wholesale, and retail process?

Otherwise I will be taxed again on the money I use that was already taxed--quite heavily I might add--when I earned it.

Yes, that's exactly what he's telling you. And you're right to be skeptical, but it's complete rubbish.

 

[Uncensored2008]

I know that's the argument. But I have just enough accounting, auditing, and tax skills to know how books are cooked and how cheaters rig things and get around thngs. And a Fair Tax gives us no more protection against government gerrymandering the system or practicing gestapo tactics than does an income tax. And it is way too easy to hide little manipulations of the system and for little manipulations to not be immediately obvious.

The beauty of the flat income tax is that everybody will pay it with no way to 'help' or 'benefit' one group without helping or benefitting all - at least without being completely obvious. And any changes or extortionary tactics also affect those the government depends on to vote for them or keep them in power and will be immediately noticable on their pay stubs.

This assumes no exemptions, deductions, or write offs. I highly doubt that such a flat tax could exist in this society.

A flat tax can still be targeted to social engineering. Exemptions for solar power, write offs for education, etc. It can, thus will be abused.

A national sales tax is indirect. Indirect taxes cannot be targeted. If one buys, one pays tax - no way out of it. I don't like VAT, because it seeks to hide tax, make it out in the open. Total the goods, add 20% - let people know how much they are paying and they might find that suddenly they don't see the need for IRS junkets. Exempt food, exempt medicine - other than that - all retail sales get taxed - at the same rate, no exemption, no exception.