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IPFS News Link • Ron Paul Says...

(Sales) Taxation is Theft

• Ron Paul Liberty Report

The bill also eliminates the Internal Revenue Service, giving states the responsibility to collect the sales tax and send the revenue to DC.

This deputizing of states to act as federal tax collectors violates the principles of federalism, especially since the plan forces states that have chosen not to make their residents pay sales taxes create a mechanism for collecting sales tax.

A 30 percent sales tax on all goods with no exceptions and no deductions will increase taxes imposed on millions of Americans. The sales tax legislation provides a way Americans can receive a monthly "prebate" payment to help offset the cost of the sales tax. Still, many taxpayers would be paying more under the new national sales tax system.

If the sales tax becomes law, Congress may never have to increase the rate above 30 percent. This is because it can rely on the Federal Reserve to increase the sales taxes via inflation. Consequently, this inflation tax will increase the pain inflicted by the sales tax on the American people.

The imposition of a national sales tax will lead to a flourishing black market for many goods. This will cause the government to increase surveillance of our purchases. It could also lead to government bureaucrats keeping lists of our purchases. This information could be abused by government officials to embarrass and punish political enemies. The surveillance could track whether an individual is complying with government dietary recommendations or is consuming "extremist" content. The need to ensure compliance with the tax laws may also be used to justify replacing cash with government issued and managed digital currency.

The proposed national sales tax rate is set at a high level because the bill's sponsors did not want to reduce the federal government's revenue. A big problem with tax reform occurs when it fails to include reductions in federal spending.


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