How To Castrate The IRS: Repeal The 16th Amendment

From The Liberty Defense League:

How to Castrate the IRS


Fri, Jun 11, 2010

Lance Voorhees, Political Action

by Lance Voorhees

June 11, 2010



Washington power brokers are on the move to repeal the 16th Amendment and revoke Congress’ power to collect income tax. If successful, the IRS would be castrated and most agents would have to apply for a transfer or hit the pavement.



Before you throw your hands up and shout, “Hallelujah,” you need to know how the Feds would replace the lost income. It’s called a consumption tax — a 23 percent federal sales tax on retailed goods and services that is in addition to state and local sales tax.



The Fair Tax Act before Congress is designed to fully fund the federal government, including Social Security, Medicare, etc. Like invisible ink, all federal deductions from your paycheck would disappear. Capital gains, self-employment, estate, gift and corporate taxes would fall by the wayside.



With the FairTax, there would be no tax liability on income spent up to federal poverty guidelines. An automatic monthly rebate to every American head of household eliminates any need to keep receipts. Foreign nationals and tourists without a Social Security card would pay the full tax, thus sharing our tax burden.



Economists say 23 percent is the magic number to make the FairTax a revenue neutral proposal. This means Uncle Sam would collect approximately the same amount of tax dollars without having to shoulder the expense and hassle of an IRS bureaucracy.



The sponsors of the FairTax could be on the verge of hitting a grand slam — more jobs, higher wages, deflation and increased exports. This combination of elements would have a spectacular effect on our national and personal economies.



Corporations would prosper because intermediate goods for production would be tax exempt. This influx of non-taxed capital combined with the elimination of payroll tax could jump-start the economy. More capital means more manufacturing plants, more factories and more jobs. As the competition for skilled workers increases, wages will have to go up.



Instead of inflation, we get deflation. Dr. Dale Jorgenson of Harvard University estimates that Americans pay 20 to 30 percent more for products due to corporate taxes passed on to consumers. The elimination of corporate taxation would create a vacuum that would drive down prices and put more cash in people’s hands.



This is especially great news for lower-income families and seniors who normally can’t afford those little extras the middle-class enjoys. With no federal tax liability up to poverty guidelines, everyone spending double their poverty level will have a realized tax rate of just 11 ½ percent (half of 23%).



The FairTax is an equitable system because Americans will pay federal tax that is in direct proportion to their lifestyle. You can think of the FairTax as a “Lifestyle Tax.”



Those who want to live high on the hog will take a bigger hit because it is their choice. Those who are frugal would have their savings flourish because any income saved would be tax-free.



The federal poverty guidelines state that a family of four making under $22,050 is living in poverty — they would have no tax liability because all four-member families will automatically get a monthly rebate of $422.62 ($22,050 x 23% divided by 12 months).



When it comes down to brass tacks, the FairTax is actually a flat tax on non-necessities rather than income. With the Fair Tax Act, nobody will need to master the 54,846 page tax code, nobody will have to file a tax return, and nobody will fear IRS agents knocking at their door. The dreadful “IRS audit” would be tossed onto the scrapheap of history.



© 2010 Lance Hunter Voorhees





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