[[Image:FairTaxRally.jpg|thumb|350px|A pro FairTax rally in Florida]]
'''The FairTax''' is a tax proposal that would replace all federal [[income tax]]es -- including corporate, gift, estate, capital gains, alternative minimum, [[Social Security]], [[Medicare]], and self employment taxes -- with a federal [[sales tax]]. The tax would be paid on the purchase of all new goods and services, and would be immediately collected at point of sale. <ref> Americans For Fair Taxation, “About the FairTax,” http://www.fairtax.org/site/PageServer?pagename=about_main</ref>
 

Thus, instead of taxing "income", the Fair Tax would tax expenses. This is known as a consumption tax. The estimated rate for the Fair Tax would be 23 percent<ref> "Embedded Taxes Change Fair Tax Analysis",http://www.roanoke.com/editorials/commentary/wb/wb/xp-51569</ref>, although some critics say it would be closer to 33%.<ref> http://www.factcheck.org/taxes/unspinning_the_fairtax.html</ref> 

Though frequently advertised by supporters as a "voluntary" tax, this is not entirely true. Consumers can indeed forestall the tax by choosing not to spend money, or by electing to purchase only second-hand goods (which are not taxed under this proposal). However, at some point, all consumers must purchase new goods and services, including various necessities such as health care, food, fuel, phone service, etc., at which point the tax would no longer be "voluntary" but mandatory. To help counter this effect -- and to make the tax more "fair" -- expenses such as those listed would be offset to a certain degree by a "prebate" -- a monthly check issued by the government to each worker. However, given the income level of most Americans, the vast majority of citizens (about 85%) would end up paying some measure of tax on these items, prebate or no. The Fair Tax would therefore operate in direct conflict with the Constitution, which prohibits Direct taxes (those paid on the necessities of life, or on any [[unalienable right]]) without apportionment. Legal challenges to the tax would probably emerge shortly after its passage and lead to nullification by the U.S. Supreme Court for violating Article I, Section 9. (See Criticism below.)
 

==Proposal==
If passed, the Fair Tax would accomplish the following<ref> American For Fair Taxation, http://www.fairtax.org/site/PageServer?pagename=about_main</ref>:

* Abolish the [[Internal Revenue Service]] (IRS).
* Abolish personal [[income tax]]es.
* Repeal the [[16th Amendment]].
* Provide each worker a monthly prebate, equal to the tax on "poverty level" income. <ref> Just how fair is the ‘Fair Tax’ CNN Money, September 2005, http://money.cnn.com/2005/09/06/pf/taxes/consumptiontax_0510/</ref>
* Close many loopholes under the current system.
* Enable retirees to receive their full pension, untaxed, until they spend it.
* Enable workers to keep their entire paycheck, untaxed, until they spend it. 

==History==

===1986-2005===
[[Image:FairTax vs. Tax Code 2.jpg‎ |thumb|300px|Congressman [[John Linder]], one of the strongest proponents for the FairTax, illustrates the size of the current tax system vs the FairTax method]]
The Fair Tax was originally the brain-child of the [[Scientologists]], as part of their ongoing battle with the IRS. The most popular of initial plans for the Fair Tax was designed by [[Americans for Fair Taxation]] (AFFT), which is led by businessman Leo Linbeck<ref> Just how fair is the ‘FairTax’ CNN Money, September 2005, http://money.cnn.com/2005/09/06/pf/taxes/consumptiontax_0510/</ref>. Linbeck stated that Americans have to pressure the government to come up with a better way of taxation, he said, “It is painfully obvious that [[Washington, D.C.]] insiders so closely linked with the status quo cannot be trusted to overturn the corrupt system of federal taxation. This effort will have to be driven by the American people<ref>Americans For Fair Taxation http://boortz.com/nuze/200510/10132005.html</ref>." The organization hired experts to look into an idea for a better tax system, they spent 23 million dollars in coming up with the idea of the Fair Tax. Their findings were combined into a book, “The FairTax Book: Saying Goodbye to the Income Tax and the IRS,” which Linbeck co-authored with Republican Congressman John Linder<ref> “The Fair Tax Book”,2005, http://www.amazon.com/Fair-Tax-Book-Saying-Goodbye/dp/0060875496/ref=sr_1_1/102-3275846-3467353?ie=UTF8&s=books&qid=1184106196&sr=1-1</ref>.

The Fair Tax became popular among free market [[conservative]]s, [[libertarian]]s, and some economist in recent years. The complication and wasted bureaucracy of the [[Internal Revenue Service]], government pressure on citizens to reveal information and records, and the loopholes in the current tax system created the incentive to look for a new way of taxation in the United States. Some [[Democrats]] also sought a tax system that would rid them current income tax, which they claim to be discriminate.

In the last 20 years the [[United States]] tax system has been changed over 14,000 times, this has led to an abundance of complexities which lead to its being an inefficient system. In 2003, United States Senator [[Saxby Chambliss]], a [[Republican]], and Senator [[Zell Miller]] a Democrat; introduced a by-partisan version of the Fair Tax. Although the bill had some support in the [[Senate]], it eventually lost in a 50-50. Senator [[Sam Brownback]] later stated the challenges of tax reform, “When you take (the tax code) on straight on, you take on every lobbyist,"

===2005-2007===

Former Federal Reserve Chairman, [[Alan Greenspan]], called for a federal sales tax to replace the broken income tax in 2005. "Since the exemplary 1986 reform, the tax code has drifted back to be overly complicated and burdened by higher marginal rates and by many special provisions that have undesirably narrowed the tax base," Greenspan stated at a Presidential Advisory counsel<ref>Greenspan: "Consumption Tax COuld Help Economy",http://www.foxnews.com/story/0,2933,149298,00.html</ref>.

In 2005 congress created a bill to enact the Fair Tax (H.R. 25; Senate Bill 1943), it had the support of more then 54 co-sponsors, and both Senate and House minority leaders [[Dennis Hassert]] and [[Tom DeLay]]<ref>“The FairTax: A Trogan Horse For America,” Jews For Preservation of Firearms Ownership, http://www.jpfo.org/fairtax.htm#fn1</ref>. Although the bill received the most support ever for any fundamental tax reform bill, it failed to pass. After the elections of 2004, Georgia Republican Congressman, [[John Linder]], reintroduced the FairTax on the first day of the 109th congress<ref> “Linder Reintroduces FairTax Legislation”, http://www.johnlinder.com/News_Details.asp?NewsID=128</ref>. Congressman Linder stated before congress, “The time is ripe for fundamental tax and a completely new Federal tax regime. I am pleased to reintroduce my Fair Tax proposal today reform, and look forward to the Congress creating a fairer, simpler tax system that advances our core goals of lower taxes and more freedom for our citizens."<ref> “Linder Reintroduces FairTax Legislation”, http://www.johnlinder.com/News_Details.asp?NewsID=128</ref>.”

In 2007 support for the FairTax bill grew to include 60 co-sponsors<ref>FairTax Gains Support, http://www.fairtaxblog.com/20070508/record-sixty-co-sponsors-for-fairtax-bill-hr-25/</ref>.

One of the most outspoken supporters of the Fair Tax is Republican presidential candidate, [[Mike Huckabee]]. Huckabee has said that the Fair Tax would "put the IRS out of business, but put Americans in business<ref> Massachusetts For Mike Huckabee, http://massachusettsforhuckabee.blogspot.com/search/label/Tax%20Plan</ref>." 

== Support==

[[Image:Fairtaxb.jpg|right|thumb|200px| A FairTax bus during a rally at the 2007 [[Republican]] [[Iowa Straw Poll]].]]
Most of the support for the FairTax comes from the [[Republican Party]] and the [[Libertarian]]s. A significant number of [[Conservative]]s want Republican presidential candidates to support the FairTax, including one Indiana group called ‘Hoosiers for Fair Taxation’<ref>”FairTax Supporters Vent Frustration”, June 2007, http://www.theindychannel.com/news/13651607/detail.html</ref>. <ref>”FairTaxer's continue to “flex their muscles”, July 2007, http://www.fairtax.org/site/PageServer?pagename=news_feature</ref>. Former Arkansas governor and presidential candidate [[Mike Huckabee]] made passage of a national sales tax a part of his platform during his recent bid for office. Former Federal Reserve chief [[Alan Greenspan]] also exhibited support for the FairTax in a recent interview.<ref>Greenspan: Consumption Tax could Help Economy, Fox News, March 2005, http://www.foxnews.com/story/0,2933,149298,00.html</ref>

Proponents of the FairTax argue it would be more practical than the current system, which includes over 60,000 pages of tax code.<ref> 67,204-Page Code Confounds Taxpayers, Yet Congress Sits By, USA Today, http://www.usatoday.com/news/opinion/2007-04-03-edit_N.htm?csp=34 </ref>. 

==Criticism==
Republican presidential candidate [[Rudy Giuliani]] criticized the Fair Tax when addressing a group at the [[University of Florida]] in July, 2007<ref> “Giuliani Jeered For Opposing Flat Tax”, Associated Press, July 2007, http://www.forbes.com/feeds/ap/2007/07/07/ap3891710.html</ref>: "I don't think a Fair Tax is realistic change for America. Our economy is dependent upon the way our tax system operates<ref> “Giuliani Jeered For Opposing Flat Tax”, Associated Press, July 2007, http://www.forbes.com/feeds/ap/2007/07/07/ap3891710.html</ref>."

None of the 2008 Democratic presidential candidates support the Fair Tax either, although [[Mike Gravel]] has indicated he supports a new kind of system based around consumption (expense) rather than income.

Aside from political criticism, however, the FairTax suffers from serious constitutional infirmities. Supporters have tried to paint the tax as an "[[excise]]". But this is wrong. The constitutional definition of an [[excise]] is a tax that is strictly limited to '''privileged''' or '''luxury''' goods and activities. The writings of the Founding Fathers, as well as numerous U.S. Supreme Court and lower court rulings, confirm this definition.<ref>http://www.conservapedia.com/Excise</ref> However, the FairTax encumbers '''necessities''' ''in addition to'' privilege and luxury items, thus making it a '''Direct tax''' within the constitutional meaning of the term. Unlike true [[excise]]s, the FairTax cannot be "avoided" because it taxes things which are necessary to live. These include food, clothing, housing, transportation, medicine, health care, arms for self-defense, phone service, sundries, education, etc. Any tax that encumbers such items must be apportioned among the states, or it violates the Constitution.

Although proponents suggest that necessities are effectively relieved from the tax by virtue of the prebate, the fact remains that necessities ''are'' taxed. Furthermore, once an individual's spending on necessities exceeds the poverty level, the prebate no longer offsets the tax, and the tax ''operates fully'' as an unapportioned Direct tax, in violation of the Constitution. In ''Brushaber v. Union Pacific Railroad Co.'' (1916), the Supreme Court ruled that whenever any "[[excise]]" morphs into a tax on items of common right (such as anything necessary to preserve and carry out a normal life) "the duty would arise to disregard form and consider substance alone, and hence subject the tax to the regulation as to apportionment which otherwise as an excise would not apply to it." Regardless of whether the FairTax is called an "[[excise]]," it is, in substance, a Direct tax which cannot be apportioned among the states. It is therefore unconstitutional.

Finally, the FairTax shares a major flaw with the current income tax system: There is no cap on the rate that Congress may impose. Initially, that rate might be established at 23%. But nothing in the FairTax proposal prevents Congress from raising the rate to 30%, or even higher. Given the government's proclivity for spending money, an eventual increase in the FairTax rate, were the tax to become law, seems inevitable. 

Another complaint is that a sales tax will not effect overseas purchases, or money from investments, encouraging hoarding.

==External Links==

*[http://www.fairtax.org/site/PageServer Americans for Fair Taxation]
*[http://www.factcheck.org/taxes/unspinning_the_fairtax.htm FactCheck.org]
 

==References==
<references/>

[[Category: Politics]]
[[Category: Economics]]

2008-03-30T22:18:06Z

Neocon123:

Delegated Powers

2008-03-30T22:14:02Z

Neocon123:

The '''Delegated Powers''', also called the '''Enumerated Powers''', are the powers of [[Congress]] established in section eight of [[United States Constitution:Article I|Article I of the US Constitution]]. There are nineteen such powers. <ref>U.S Government and Politics</ref>

The Delegated Powers are as follows:<ref>United States Constitution</ref>

*The Congress shall have power To lay and collect [[Taxes]], [[tariff|Duties]], Imposts and [[excise tax|Excises]], [in order to] to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;

*To borrow money on the credit of the United States;

*To regulate Commerce with foreign Nations, and among the several States, and with the [[Native Americans|Indian Tribes]];

*To establish an uniform Rule of [[Naturalization]];

*To establish uniform Laws on the subject of [[bankruptcy|Bankruptcies]] throughout the United States;

*To coin [not print] Money, regulate the Value thereof, and of foreign Coin;

*To fix the Standard of Weights and Measures;

*To provide for the Punishment of [[counterfeiting]] the Securities and current Coin of the United States;

*To establish [[Post Offices]] and [[Post Roads]];

*To promote the Progress of Science and useful Arts, by [[patent|securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries]];

*To constitute [[Tribunals]] inferior to the [[Supreme Court]];

*To define and punish Piracies and Felonies committed on the high Seas, and Offenses against the Law of Nations;

*To declare [[War]], grant Letters of Marque and Reprisal, and make Rules concerning Captures on Land and Water;

*To raise and support [[United States Army|Armies]], but no Appropriation of Money to that Use shall be for a longer Term than two Years;

*To provide and maintain a [[United States Navy|Navy]];

*To make Rules for the Government and Regulation of the land and naval Forces;

*To provide for calling forth the [[Militia]] to execute the Laws of the Union, suppress Insurrections and repel Invasions;

*To provide for organizing, arming, and disciplining the Militia, and for governing such Part of them as may be employed in the Service of the United States, reserving to the States respectively, the Appointment of the Officers, and the Authority of training the Militia according to the discipline prescribed by Congress;

*To exercise exclusive Legislation in all Cases whatsoever, over such [[Washington, D.C.|District]] (not exceeding ten Miles square) as may, by Cession of particular States, and the acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards, and other needful Buildings.

 

NOTE:
*Under Article I, Sections 2 and 3, Congress also has the power to impeach the President and remove him (or her) by trial.

*Under Article III, Section 2, Congress also has the power to prohibit the Supreme Court from adjudicating any particular case (such as Roe v. Wade).
 

The following clause (appearing in Article I, Section 8) refers to the Implied Powers of Congress -- those necessary to accomplish the above, but not specifically mentioned ("enumerated"):

*To make all Laws which shall be [[necessary and proper clause|necessary and proper]] for carrying into Execution the foregoing Powers, and all other Powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof.

==References==

<references/>

[[Category:United States Government]]