“Rerun Novarum,” by Leo XIII, Holy See, 15 May 1891, http://www.vatican.va/holy_father/leo_xiii/encyclicals/documents/hf_l-xiii_enc_15051891_rerum-novarum_en.html.
“Bill would dump IRS for sales tax,” by Rob Strom, World Net Daily 13 April 2005, http://www.worldnetdaily.com/news/article.asp?ARTICLE_ID=43764 (from Free Republic).
A Congressman is proposing that most taxes be replaced by a national sales tax
A federal bill that would do away with federal income tax and replace it with a national sales tax has been introduced again in the House of Representative after the same bill failed to get committee consideration in the last Congress.
The bill, H.R. 25, is sponsored by Rep. John Linder, R-Ga. Dubbed the “FairTax” proposal, the bill “will repeal all corporate and individual income taxes, payroll taxes, self-employment taxes, capital gains taxes, estate taxes and gift taxes â€“ and replace it with a revenue-neutral personal consumption tax,” according to the congressman’s website.
Because the 23 percent consumption tax is paid only by the end user, business-to-business purchases for the production of goods and services would not be taxed. An organization pushing Linder’s plan, Americans for Fair Taxation, estimates consumer prices would drop by an estimated 20-30 percent as a result of the change.
It doesn’t have a chance this Congress, but this is a great idea. It makes no sense to punish income or investment. It makes a lot of sense to discourage overconsumption.
The best part? It proves that my idea of a pre-rebated consumption tax is catching on
Also included in the bill is a rebate payment that would go to every American household to replace the sales tax paid on necessities. Those in poverty, the bill’s proponents say, would effectively not pay any tax under the new system.
“Under the FairTax, no American will pay taxes on necessities,” says Americans for Fair Taxation. “The rebate will be equivalent to the tax paid on essential goods and services. The rebate will be mailed before the tax is actually paid [and] will be paid in equal installments at the beginning of the month. The size of the monthly rebate will be determined by the federal poverty level for a particular household size.”
Another idea would be to expand the rebate to cover necessities themselves. This should be achievable with a slight increase in the consumption tax that would be mostly paid by the richest. While some may say this open the door to a national minimum income, it solves two dilemmas earlier seen by Pope Leo XIII — how free bargaining can be guaranteed to lead to frugal comfort, and how to get even the poorest to save
There is another and deeper consideration which must not be lost sight of. As regards the State, the interests of all, whether high or low, are equal. The members of the working classes are citizens by nature and by the same right as the rich; they are real parts, living the life which makes up, through the family, the body of the commonwealth; and it need hardly be said that they are in every city very largely in the majority. It would be irrational to neglect one portion of the citizens and favor another, and therefore the public administration must duly and solicitously provide for the welfare and the comfort of the working classes; otherwise, that law of justice will be violated which ordains that each man shall have his due. To cite the wise words of St. Thomas Aquinas: “As the part and the whole are in a certain sense identical, so that which belongs to the whole in a sense belongs to the part.” Among the many and grave duties of rulers who would do their best for the people, the first and chief is to act with strict justice – with that justice which is called distributive – toward each and every class alike.
Let the working man and the employer make free agreements, and in particular let them agree freely as to the wages; nevertheless, there underlies a dictate of natural justice more imperious and ancient than any bargain between man and man, namely, that wages ought not to be insufficient to support a frugal and well-behaved wage-earner. If through necessity or fear of a worse evil the workman accept harder conditions because an employer or contractor will afford him no better, he is made the victim of force and injustice. In these and similar questions, however-such as, for example, the hours of labor in different trades, the sanitary precautions to be observed in factories and workshops, etc. – in order to supersede undue interference on the part of the State, especially as circumstances, times, and localities differ so widely, it is advisable that recourse be had to societies or boards such as We shall mention presently, or to some other mode of safeguarding the interests of the wage-earners; the State being appealed to, should circumstances require, for its sanction and protection.
If a workman’s wages be sufficient to enable him comfortably to support himself, his wife, and his children, he will find it easy, if he be a sensible man, to practice thrift, and he will not fail, by cutting down expenses, to put by some little savings and thus secure a modest source of income. Nature itself would urge him to this. We have seen that this great labor question cannot be solved save by assuming as a principle that private ownership must be held sacred and inviolable. The law, therefore, should favor ownership, and its policy should be to induce as many as possible of the people to become owners.
Here here for the Catholic rebated Consumption Tax!