The IRS Scandal Expands – Are You Ready for the Fair Tax Yet?


The IRS Scandal – Another Reason for the Fair Tax, was written at the start of the IRS scandal.  From testimony since that point it appears that 1)there are officials at the IRS who have been using their power to target Conservative groups for years, 2) people in the IRS have given confidential information from one group to a political opponent (specifically the donor list of the Conservative group so that the Liberal group could harass those donors and quell their free speech) and 3) officials who have been engaged in this activity have been rewarded and promoted.  We also learned today that managers at the IRS have spent a lot of money on conferences, including stays in $3500 per night Presidential Suites and making expensive, embarrassing videos using lavish sets, all paid for by the taxpayer.

I must say that I’m disappointed to not hear from people advocating for the  Fair Tax  as I requested in the last post.  Again, with the Fair Tax, a national sales tax is levied on the sale of new goods and services to consumers.  To keep the tax from being regressive, each citizen would receive a check (or an electronic deposit) from the Government to cover a portion of the taxes.  Those who spent little, perhaps just enough for basic necessities, would therefore pay no taxes, while those who spent a lot, perhaps on a lot of luxuries, would pay more taxes.

One huge benefit of the Fair Tax is not needing to fill out all sorts of paperwork, requiring a lot of time and expense.  You would just pay a sales tax when you bought a new good or service – no paperwork at all for the consumer.   You would also not need to give the Government all sorts of information about your income, giving, and expenses as is currently required with the income tax.  We have now seen that people in the Government can, and apparently do abuse access to that information for political reasons.

Just as it is easy to pay state sales taxes (you just go to the register and the clerk tells you how much it is and you pay it), paying your Federal taxes could be just as easy.  You would not need to keep receipts.  You would not need to lock money away in special accounts or perform fiscal gymnastics when transferring retirement assets from a 401k to an IRA anymore.  The businesses would need to collect the taxes and send them in, but this would be an easy calculation.  Everyone would pay, no matter how they earned their income.  This includes pimps and drug dealers since they buy things too.

Best of all, we could scale back the IRS staff and their power dramatically if the Fair Tax was passed.  With the Fair Tax, we could cut the IRS staff and budget by 90% because they would only need to verify that merchants were collecting and sending in taxes on the items they sold. There are a lot fewer merchants than citizens, and the amount of paperwork would be a lot less, so this would require a lot fewer agents and auditors.  This would remove the ability of Government to abuse citizens with the power of the IRS, through targeted audits, slow walking approvals, or giving out private  information.  While the current scandal should result in a lot of people who engaged in these activities going to jail, I hope you agree that it is clear that a group of elected, political individuals cannot be trusted with this kind of power again.  Next time it might be Liberal organizations who are targeted.

We need people to advocate to their representatives for implementing the Fair Tax or it will never happen.  We need to flood inboxes, mail boxes, and phone banks with calls.  We need postings on blogs, in comment sections, and letters sent to the editors of newspapers.   Everyone needs to learn about the Fair Tax and then discuss it with their friends and family.  Read more about the Fair Tax (don’t take my word for how great it would be), and then forward the link to a friend of three.   Then call or write to your congressman today and demand they pass the Fair Tax.

Once again, when you do, please comment here or write me a note (vtsioriginal@yahoo.com) to let me know you did.  This will also let others know that they are not alone and help build the momentum.  Do something today!

Please contact me via vtsioriginal@yahoo.com or leave a comment.

Follow me on Twitter to get news about new articles and find out what I’m investing in.  @SmallIvy_SI

Disclaimer: This blog is not meant to give financial planning or tax advice.  It gives general information on investment strategy, picking stocks, and generally managing money to build wealth. It is not a solicitation to buy or sell stocks or any security. Financial planning advice should be sought from a certified financial planner, which the author is not. Tax advice should be sought from a CPA.  All investments involve risk and the reader as urged to consider risks carefully and seek the advice of experts if needed before investing.

Comments appreciated! What are your thoughts? Questions?

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s