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Let’s Give the Fair Tax a Fair Chance

By Bob Hall 

No rational person can honestly defend our current “Income Tax” system. It is far too complex, unfair and a huge burden to businesses and citizens. The vast majority of the tax code has been specifically written to give one group an unfair advantage over the rest of the population. It is being effectively used as fuel to flame the fires of class warfare and serves to divide people based on income levels.

The “Fair tax” is simply a ‘consumption tax” which completely replaces all payroll deduction taxes. With the “Fair Tax” everyone (drug dealers and illegal aliens included) will pay their fair share of taxes because the tax is based on what people buy rather than on what income they report. It is imminently fair since the affluent will pay more in taxes because they will make more expensive purchases than will the poor. The “Fair Tax” also eliminates the corporate income tax therefor the increase in purchase price will be offset by the reduction in product price. It is important also to understand that the “Fair Tax” will only apply to new goods and services. There will be no “Fair Tax” applied to used products.

Senior FairTax strategist Denis Calabrese responds on video to a series of Frequently Asked Questions about the FairTax.

The “Fair Tax” plan eliminates the “unfairness” issues of the current system, improves personal and business efficiencies and eliminates one liberal class warfare tool. No longer would people have to make decisions based on how the IRS might view their actions. No longer would innocent citizens be subjected to the heavy burden imposed by this agency. Without the intrusive audits and time consuming requests for documentation, personal lives would improve, as would business efficiency. Tax benefits would no longer be the driving force behind business decisions. In addition to lifting the huge administrative burden of maintaining records, filling in forms, submitting reports and enduring time consuming audits, there would be no need for the IRS, as we now know it. Yes, the most burdensome and abusive government agency would no longer be necessary. There are universal good reasons that the IRS should be eliminated. And the biggest reason is their collection tactics

When it comes to the current income taxing scheme, all money matters for the IRS fall into one of three categories; “black”, “white” or “gray”. The “black” category consists of those things that are very clear that one must either do or not do, all of which favor the IRS. Those issues in this category cause more taxes to be paid to the IRS. The “white” category consists of those items which favor taxpayers and allows the taxpayers to keep more of their earnings. The “gray” category is by far the largest and it consists of all the nebulous issues; expenditures for which the tax code is either vague or silent. These are the “gotcha -issues” by which the IRS attempts to collect more money from corporations and individuals than specifically allowed by the tax code. “Gray” area tax audits are time consuming for both the IRS and the Taxpayer.The “gray” area cases are time consuming for the IRS because the corporation or individual most often has good rational and documentation for what they did,  and also has it well documented. While the IRS would like to rake in as much money as possible by disallowing all “gray area” deductions and claims, they will try to do so by any means except going to court.

Threats, intimidation, and liens are the IRS’s preferred ways of bullying people into paying their “gray” area claims. They avoid allowing most “gray” area cases to go to court. They will first threaten the taxpayer with all kinds of punishment if they don’t pay quickly. If threats do not work, they will try intimidation,  which often includes agents visiting neighbors and business associates. When it becomes obvious that the taxpayer is firm in his or her resolve that they are right and the IRS is wrong, the IRS will then start filing liens with courthouses where the taxpayer works and/or does business.  At this point the IRS will change their tactics from overt collection actions to a waiting game. A court proceeding is almost never initiated by the IRS for a “gray area” case. In fact, as strange as it may sound, the IRS does not want these cases to go to court. If a “gray area” was to go to court and the judge ruled in favor of the taxpayer, a case law precedent would be set that would keep the IRS from making similar collections from other taxpayers in the future. 

The IRS is also counting on the taxpayer not taking the initiative (usually because of legal expense) to take the case to a tax court. Usually the taxpayer is just happy to have some relief from the many weeks of harassment, threats and intimidation. 

With the liens in place the IRS can play a waiting game with the taxpayer. Rather than taking the chance of losing the case in court and having a new case law precedent set that would restrict future collection with other taxpayers, the IRS will just wait in hopes that this taxpayer will either die or want to sell property against which they have placed a lien. This waiting game has some risk for the IRS because of the statutes of limitation on collections.. Lawmakers wisely (at least in this situation) placed a time limit in which the IRS can  pursue a perceived debt. Once the IRS starts a collection action they must complete it within a finite time period, otherwise the law says it is not a taxpayer debt.

The risk the IRS takes are two fold; 1. The taxpayer may not have to, or want to, sell any property in the jurisdiction of the lien or 2. The tax payer may not die before the lien statute of limitation expires.  Yes, the IRS actually hoping that the taxpayer will die so they can then collect what they are after from the estate before distribution is made to the family of the deceased. In the case of the taxpayer dying, the IRS is counting on the family being unknowledgeable enough or unwilling to argue while grieving.

Under the Fair Tax system citizens would no longer be subject to these kinds of abuses. Only the Fair Tax system, which does not tax income, would completely eliminate the need for the IRS.

To learn more about the Fair Tax, go to  http://www.fairtax.org

Bob Hall is a Constitutional Conservative with Judeo Christian values and has been a Tea Party activist in East Texas since 2008. He is the leader of the Canton Tea Party Patriots and a member of the East Texas Constitutional Alliance (ETXCA). Mr. Hall has help organize several Tea Party groups and events throughout Texas.

 

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