Which Tax is the Right Tax?
by Brent Johnson
For the past several months the American people have been hearing about tax reform. Actually, we have heard ideas about tax reform since taxes became a part of American life. But it has now become a current hot political issue and so the American public is being exposed to a variety of proposals designed to implement tax reform into the lives of all Americans. The issue is so immediate that many observers believe that the long overdue end of the Internal Revenue Service and graduated income tax cannot be far behind.
This all sounds too good to be true, or does it? Is the end of the IRS and a so-called simplification of the American income tax system really desirable, now or ever? Let's take a look at the most common proposals; a national sales tax, and a flat rate tax.
The national sales tax is embodied in current legislation HR.3039 ( I suggest you obtain a copy and see for yourself). This piece of legislation would effectively convert what is now an excise tax on certain revenue taxable activities, to a point of purchase tax on just about everything imaginable. Initially, this proposal seems to represent a boon to American taxpayers. After all, wouldn't it be great if you just paid an additional 15 percent on your purchases and had no more income tax? Remember the old adage, if it sounds too good to be true, it probably is.
Upon reading the actual legislation you will find that this tax does not relieve the individual citizen of filing. Rather, the citizen is expected to file more frequently than previously. Also, this tax extends to all products and services. In other words, if this legislation becomes law, then the federal government will take the position that every penny you bring in, regardless of the source or nature of the revenue, is subject to this tax. The government will presume (just as the IRS currently presumes) that everything you have is taxable. Everything. You currently may have deductions for a variety of reasons; if this bill passes you will have none. You currently may have a variety of exemptions you are entitled to; if this bill passes you will have none. Currently, some of your earnings may not be included in gross income; if this bill passes, everything will be taxable. Everything. Further, all Americans will be expected to act as fiduciary agents (i.e. tax collectors) for the federal government, clearly an unconstitutional requirement (currently, the IRS only expects employers to act as tax collectors - and it is voluntary). There will be severe penalties for those who fail to file and/or pay the taxes to the government. The State will be authorized to collect the tax and then send it to the federal government, thus increasing the federalist nature of the legislators in the District of Columbia. This will also serve to increase the power of Washington D.C. over the States, who themselves are supposed to be superior to the federal government.
All in all, the national sales tax is probably the worst idea of all, because it requires you to pay a tax which you are currently not required to pay (unless you work for the government or are a corporate officer). Better to keep your money for yourself and your family.
The flat tax, however, is an interesting idea. This proposal would establish a flat rate on earnings, replacing the present and extremely unpopular graduated income tax. In effect, all deductions would disappear and every taxpayer would pay an annual flat rate percentage of his or her earnings in the form of an income tax. This system would immensely simplify payment of income taxes for all Americans. Unlike the national sales tax, it would not affect those who are not currently required to file and pay these taxes. The flat tax, as a whole, will help more people than it will hurt, without violating anyone in the process.
The most interesting piece to this puzzle, however, rests with the realization that the current federal and State income tax, pursuant to Title 26 of the United States Codes (Internal Revenue Code), is an excise tax on the privilege of doing business with the government. 26 USC 3401(c) clearly defines an "employee" as an elected government official, or a corporate officer. If you work in the private sector, you are not required to file an income tax return. Also, your earnings are not "wages", you have no "gross income", and you are not required to have any money withheld from your private sector non-taxable remuneration. You cannot be fired for refusing to allow your employer to continue withholding from your earnings; if you are, your employer is liable for severe damages. You also cannot be fired for refusing to provide a social security number (which is voluntary). Growing numbers of small and especially large companies are finding out, to their dismay, that in these situations the worker is in the right. Taco Bell, Motorola and McDonalds are among the major corporations who have learned the truth, sometimes the hard way, and are now accepting workers without social security numbers. This means you do not have to have FICA (Federal Insurance Contributory Act) taken out of your pay.
To those who think that it is the patriotic duty of all Americans to pay income taxes, you should know that 100% of your income tax leaves the country! That's right, not one penny goes to essential (or even non-essential) services. It all goes to the privately owned Federal Reserve System to pay for the federal (not national) debt, which itself is created by the private bankers who make up the Federal Reserve Board. If every American stopped paying income taxes tomorrow, there would be about a one trillion dollar infusion into the American economy; money which is currently being sent elsewhere! So much for patriotic duty.
The point of all this is that while most Americans debate whether the flat tax or national sales tax is the way to go, you can become one of the educated minority ignored by the IRS! If you work in the private sector you do not have to pay income tax. Patriotism means loyalty and dedication to the Constitution, not the federal government. Americanism means you own your life, your earnings, your labor, not the government. As long as you do not take from the government, you owe nothing to it.
So when you evaluate the flurry of tax reform proposals, remember that the best reform is the one that leaves you with everything you have earned. Remember the men who fought and died to establish a country in which no citizen could be forcibly taxed on his or her earnings. Remember what it means to be an American, and stand up for your rights! Learn the truth about the IRS and you can make your own tax reform.
As for me, I think the flat tax is the better reform for taxpayers. But my definite preference is for the IRS to continue in its present form. I already know my way around their regulations. The IRS leaves me alone (and I'm a public figure)! I am what the United States Supreme Court calls a "nontaxpayer." I invite you to come join the growing ranks of nontaxpayers.
I leave you with one final thought. Consider how your lifestyle might improve if you had all of the money you have been sinking into social security and the income tax back in your pockets. Start living your life that way today.
For the past several months the American people have been hearing about tax reform. Actually, we have heard ideas about tax reform since taxes became a part of American life. But it has now become a current hot political issue and so the American public is being exposed to a variety of proposals designed to implement tax reform into the lives of all Americans. The issue is so immediate that many observers believe that the long overdue end of the Internal Revenue Service and graduated income tax cannot be far behind.
This all sounds too good to be true, or does it? Is the end of the IRS and a so-called simplification of the American income tax system really desirable, now or ever? Let's take a look at the most common proposals; a national sales tax, and a flat rate tax.
The national sales tax is embodied in current legislation HR.3039 ( I suggest you obtain a copy and see for yourself). This piece of legislation would effectively convert what is now an excise tax on certain revenue taxable activities, to a point of purchase tax on just about everything imaginable. Initially, this proposal seems to represent a boon to American taxpayers. After all, wouldn't it be great if you just paid an additional 15 percent on your purchases and had no more income tax? Remember the old adage, if it sounds too good to be true, it probably is.
Upon reading the actual legislation you will find that this tax does not relieve the individual citizen of filing. Rather, the citizen is expected to file more frequently than previously. Also, this tax extends to all products and services. In other words, if this legislation becomes law, then the federal government will take the position that every penny you bring in, regardless of the source or nature of the revenue, is subject to this tax. The government will presume (just as the IRS currently presumes) that everything you have is taxable. Everything. You currently may have deductions for a variety of reasons; if this bill passes you will have none. You currently may have a variety of exemptions you are entitled to; if this bill passes you will have none. Currently, some of your earnings may not be included in gross income; if this bill passes, everything will be taxable. Everything. Further, all Americans will be expected to act as fiduciary agents (i.e. tax collectors) for the federal government, clearly an unconstitutional requirement (currently, the IRS only expects employers to act as tax collectors - and it is voluntary). There will be severe penalties for those who fail to file and/or pay the taxes to the government. The State will be authorized to collect the tax and then send it to the federal government, thus increasing the federalist nature of the legislators in the District of Columbia. This will also serve to increase the power of Washington D.C. over the States, who themselves are supposed to be superior to the federal government.
All in all, the national sales tax is probably the worst idea of all, because it requires you to pay a tax which you are currently not required to pay (unless you work for the government or are a corporate officer). Better to keep your money for yourself and your family.
The flat tax, however, is an interesting idea. This proposal would establish a flat rate on earnings, replacing the present and extremely unpopular graduated income tax. In effect, all deductions would disappear and every taxpayer would pay an annual flat rate percentage of his or her earnings in the form of an income tax. This system would immensely simplify payment of income taxes for all Americans. Unlike the national sales tax, it would not affect those who are not currently required to file and pay these taxes. The flat tax, as a whole, will help more people than it will hurt, without violating anyone in the process.
The most interesting piece to this puzzle, however, rests with the realization that the current federal and State income tax, pursuant to Title 26 of the United States Codes (Internal Revenue Code), is an excise tax on the privilege of doing business with the government. 26 USC 3401(c) clearly defines an "employee" as an elected government official, or a corporate officer. If you work in the private sector, you are not required to file an income tax return. Also, your earnings are not "wages", you have no "gross income", and you are not required to have any money withheld from your private sector non-taxable remuneration. You cannot be fired for refusing to allow your employer to continue withholding from your earnings; if you are, your employer is liable for severe damages. You also cannot be fired for refusing to provide a social security number (which is voluntary). Growing numbers of small and especially large companies are finding out, to their dismay, that in these situations the worker is in the right. Taco Bell, Motorola and McDonalds are among the major corporations who have learned the truth, sometimes the hard way, and are now accepting workers without social security numbers. This means you do not have to have FICA (Federal Insurance Contributory Act) taken out of your pay.
To those who think that it is the patriotic duty of all Americans to pay income taxes, you should know that 100% of your income tax leaves the country! That's right, not one penny goes to essential (or even non-essential) services. It all goes to the privately owned Federal Reserve System to pay for the federal (not national) debt, which itself is created by the private bankers who make up the Federal Reserve Board. If every American stopped paying income taxes tomorrow, there would be about a one trillion dollar infusion into the American economy; money which is currently being sent elsewhere! So much for patriotic duty.
The point of all this is that while most Americans debate whether the flat tax or national sales tax is the way to go, you can become one of the educated minority ignored by the IRS! If you work in the private sector you do not have to pay income tax. Patriotism means loyalty and dedication to the Constitution, not the federal government. Americanism means you own your life, your earnings, your labor, not the government. As long as you do not take from the government, you owe nothing to it.
So when you evaluate the flurry of tax reform proposals, remember that the best reform is the one that leaves you with everything you have earned. Remember the men who fought and died to establish a country in which no citizen could be forcibly taxed on his or her earnings. Remember what it means to be an American, and stand up for your rights! Learn the truth about the IRS and you can make your own tax reform.
As for me, I think the flat tax is the better reform for taxpayers. But my definite preference is for the IRS to continue in its present form. I already know my way around their regulations. The IRS leaves me alone (and I'm a public figure)! I am what the United States Supreme Court calls a "nontaxpayer." I invite you to come join the growing ranks of nontaxpayers.
I leave you with one final thought. Consider how your lifestyle might improve if you had all of the money you have been sinking into social security and the income tax back in your pockets. Start living your life that way today.
