Rep. John Linder updates volunteers
Congressman John Linder, sponsor of HR 25 (The Fair Tax Act of 2007), was the guest speaker at a volunteer information and training meeting in Newnan, Georgia on Saturday, January 20, 2007.
Some of the highlights of Congressman Linder's talk included the findings of a study conducted by the Rockefeller Foundation, which shows that states which rely on sales taxes are doing better economically than those which rely on income taxes.
The challenge of U.S. dollars being moved to offshore bank accounts in an effort to avoid paying taxes on capital gains and interest has grown to about $11 trillion (up from 1.3 trillion just a couple of years ago) and is growing by $800 billion per year, resulting in billions of dollars in lost tax revenue every year. Former Federal Reserve Chairman Alan Greenspan said that once the FairTax is passed it would take only months for that money to be repatriated back into U.S. banks where it could then be used to grow the economy.
The underground economy, which not only includes illegal trades such as drugs and prostitution but also includes independent contractors who collect cash for their services and underreport it, has grown to over $3 trillion annually resulting in almost $1 trillion in lost tax revenue annually.
The cost for American businesses and individuals to comply with the tax code in 2006 was up to $400 billion and is predicted to continue to rise in coming years.
Congressman Linder stated that the FairTax will be a lot less susceptible to such tax evasion. Economic figures show that 47 percent of all retail sales are made by just 688 businesses our "Big Box" retailers. 87 percent of retail sales are made by 193,000 businesses, which is still only 3.7 percent of all U.S. businesses. These businesses are not likely to risk their business licenses by not complying with the collection and remittance of the FairTax revenue levied on their retail sales.
Linder reminded the group that Social Security had 42 workers per retiree at its inception. That number is down to about four workers for every retiree and shrinking rapidly. Former White House Chief Economic Adviser Larry Lindsey has stated that either of the following measures would save Social Security:
1. Raising/eliminating the current cap on income of $90,000; or
2. Broadening the base that pays into Social Security.
Doing both (as the FairTax does by taxing all consumption except education) would create a surplus in the fund.
Congressman Linder explained that only people with earned income (i.e., wages and salaries) pay Social Security taxes, and they pay only on the first $97,500 earned. The wealthy who don't have an income from working pay nothing into Social Security. With the FairTax, when they spend their wealth, the wealthy would pay the FairTax on their purchases and would contribute to the Social Security fund. Their contributions would be unlimited based upon their spending decisions.
Linder shared with the group that he is very encouraged with the 37 co-sponsors already signed on to the legislation just two weeks into the Congress. He told the group that it was six or seven months before the Fair Tax Act of 2005 had that many co-sponsors. He expects that this bill will exceed his goal of 100 co-sponsors and with Representative Dan Boren (D-OK) as the lead co-sponsor, he is confident of achieving bipartisan support in this Congress.
Linder received the biggest round of applause when he told the group that if the new Democratic controlled Congress wants to pass the FairTax in the next two years he will do all he can to assist them in that effort.
Many thanks to the 80-plus FairTax supporters who gave up their Saturday morning to attend the meeting and learn more about how they can help promote the FairTax. The attendees were ready to offer lots of good ideas plus their time and talent. Look for a FairTax MySpace Web page that will be built by one of the attendees. Several supporters volunteered to be trained so they could become speakers to the many organizations throughout the state that ask for a presentation. And most agreed to help out by manning booths at carnivals, business conventions, community fairs, etc.
Additional information and training meetings are being planned for Gainesville and Macon in February. The exact dates will be decided soon and announced. So if you couldn't make this meeting you will have other opportunities. Congressman Linder has agreed to attend the future meetings as his schedule allows.
If you are interested in attending the next meetings in either Gainesville or Macon, Georgia, please e-mail Angela at: email@example.com.