George Will's questions for John Kerry

Which means you will NEVER EVER EVER achieve your flat tax goal. The special interest groups in power right now enjoy their loopholes too much.

It's a great idea Gary, but so is that 1000 mpg carburator. :^)

Jim

================================================== please reply to: JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com ==================================================

Holy smokes. Are you suggesting that *everything* should be taxed, with no tax deductions at intermediate stages of production? That's NOT how a VAT works. Nor is it the way any consumption tax I've ever heard of works.

That really *would* be a case in which you're paying taxes on taxes. It would compound through the roof.

Think about what you're saying here.

Ed Huntress

You persist in talking of corporations as if they were sentient life forms. They aren't. They're just a method of organizing people to conduct business. But they are made up of real people, who do think, vote, and pay taxes.

Gary

Interesting question. Just exacty what *are* corporations, and what are the laws and regulations that goven their existence?

What's the derivation of the word, 'corporation?'

Jim

================================================== please reply to: JRR(zero) at yktvmv (dot) vnet (dot) ibm (dot) com ==================================================

Oh, no. He has a much better way: To invest his money offshore, in some growing economy where the people are still sane. That way he pays no US taxes at all. If he chooses his foreign country well, he'll pay no taxes at all, anywhere.

Because the alternative is to give a free ride to those who USE the services, at society's expense. Karl Marx on drugs.

Let's do a quick, five-minute analysis of what would happen if all taxes were replaced with a national sales tax. Say it's 23%, as you've proposed. You make it effective on a Monday.

On Tuesday, the NYSE and NASDAQ both collapse, because every company has de-listed itself and re-listed in London, Frankfurt, or Tokyo. No company in the US has a pot to pee in, nor any operating capital on hand. Within 90 days, they all collapse.

On Wednesday, Bill Gates buys a new Ferrari, but he buys it in Milan, Italy. But he never actually "bought" it. He set up a bank account in Liechtenstein and then set up a corporation there in his own name. He loaned the money in his personal account to the new corporation -- no bond, just an unsecured loan. The company used the money to buy the Ferrari in Milano. They buy it for export, thus avoiding the 22% (2002 figures, I don't know what's current) Italian VAT, thus giving themselves a 22% discount on the car. Title to the car is retained by the Bill Gates Corporation in Liechtenstein. It's a company-owned car.

The car is shipped to New York, where Bill Gates takes possession as CEO of the Liechtenstein corporation. No transaction occurs. The company retains title and re-registers it in the US. Gates gets the car tax-free. He got a

22% discount on the price in Italy and then he dodged the 23% US sales tax. Not bad.

On Thursday, everyone else in the US catches on and starts buying European cars in Europe. It's tricky, but nothing like typical investment funds. Everyone just deposits money in a market account, with no shares or bonds involved. The account loans money to a European car-leasing company, which leases a car to you, with the lease paid by charges against the market account you've deposited money in, in Europe. You've made a bad loan, or you've gotten a cheap car, depending on how you want to look at it.

On Friday, the US car business, including manufacturing and its entire supply chain, collapses.

On Saturday, the people who hold mineral rights in the US wake up and realize that the value of their holdings has just dropped by 23%, because the minerals they're speculating on are traded on world markets and anything mined and sold in the US will be taxed at 23%. Their rights and any mineral mined can still be bought or sold, but at a depressed price. It won't matter much, because by then manufacturing will be moving offshore in droves, and there will be no US market for the minerals anyway.

On Sunday, everybody blows their brains out.

Now, I'm no tax accountant, so those are just the obvious consequences. I'm sure that, given a day or two, someone with a really devious mind could have your entire system undermined so badly that there would be no economy here to worry about.

Corporations have no need to vote. Corporations make sure all the candidates will support ther interests with campaign contributions.

Whoever wins, they own him.

Ed Patters>>