A Discussion of the Missouri Taxpayer Relief Act – Part 2

By John McMillen:

David, thank you for your opinion.  We all have our own opinion of how we would like things to be, and an opinion on what would best sell to this special interest group or that special interest group, etc.  That is why we now have a 72,536 page federal income tax code and a state income tax code that mimics the federal. Both are onerous burdens to the working man and the small business entrepreneur.

I won’t try and debate you on an academic scholarly level, as I can see you’re well school in that area.  And, I am not as well qualified as Carl of course to defend the features of the “Missouri Taxpayer Relief Act.”  But, as a common layperson who has followed this effort from the very beginning. I can assure you there is no magic formula in coming up with an “income tax replacement” measure that can’t be demonized to death by opponents who want to exploit emotions, and play fast and loose with the facts.

The current measure has exempted dozens of categories as is pointed out in the handout I gave you last night.  (Since there are many who were copied on this email that weren’t present last night, I’ve attached a copy)  Here

But even though they’ve been exempted, the opposition still lies and says they are taxed when they are not.  The opposition won’t even talk about a specific measure; they just refer to some vague “tax everything” tax in recent articles in area newspapers and radio spots which have been enlisted to perpetrate that lie. The opposition are the ones who are really scared. They are scared of the facts, so they get emotional.

In the beginning there was a proposal to rebate back all taxes spent on food and all sales tax spent on the basic necessities, but that didn’t keep the opposition from ignoring that fact and lying to scare people by telling them basic necessities are going to go up, and it will “hurt the poor.”

A straight sales tax is regressive by nature. But the people working to replace the income tax with a sales tax have been very conscious of that fact and have crafted numerous mechanisms to alleviate that negative impact on the poor.  The opposition has always twisted the facts to caricature us as rich and greedy offspring of Simon Legree or Ebenezer Scrooge, even though there are thousands of working class families like mine across the state of Missouri and millions across this nation who want this more than the ‘so-called rich”, and would be benefited more by it than the “so-called rich.”

If the opposition truly wanted to tax the wealth of the rich, they would be behind this measure 110%.  The reason a Warren Buffet can spout off about his secretary being taxed at a higher “INCOME tax rate than he is, is because he doesn’t report his mega millions and billions as ‘income.”  The working class have no choice in the matter under the current income tax system.  The income tax does nothing to tax wealth.  It taxes the symbiotic driving forces of a free economy, wages and profits.

Facts have got to control our emotions or we will all become emotional cripples totally dependent on the state, which is what the opposition’s strategy truly is.

Here are some facts http://www.ilfb2.org/fff06/51.pdf  in the 1930’s Americans were spending over 20% of their income on food.  In 2004 Americans were spending about 10% of their income on food.  I’m sure it is much the same today.  All the other basic necessities under the “Missouri Taxpayer Relief Act” are not taxed such as shelter, medical, education, childcare, nursing homes, etc… all the things they say we’re taxing but actually aren’t.

An $800 per week wage earner today gives up about 3% of gross pay in Missouri state income tax after working through the standard deductions and arriving at taxable income on a typical Missouri tax return.  Now that’s 3% of his gross. In the case of an $800.00 per wk income earner in this case is about $42,000.00 per year.  ($42,000.00 X .03 = $1,260.00.)

This is about the same annual amount as the “social security tax relief cut” for working families being fought over in D.C. right now and being hyped as a “HUGE FACTOR IMPACTING OUR ECONOMY” by the same camp who oppose replacing the income tax, with a sales tax…for some reason they don’t see this same amount of money as having that same amount of impact, or as a the same significant increase in spendable income for working families.   Hmmmm.

The increase in sales tax on Food under the “Missouri Taxpayer Relief Act” would be about 3% more than present when local sales tax rates are adjusted under the act: 10% of $42,000.00 = $4,200.00.  $42,000.00 X .03 = $126.00

Now which would I rather have… your emotional $126.00? or my logical, factual $1,260.00?  I can get highly emotional about that $1,100 difference!

I think I can get a lot more emotional over losing$1,260.00 than $126.00 if given a choice.

Even if you spend more than 10% of your gross income on food, there’s a wide buffer there before one can scream he has been ‘hurt’ by the “Missouri Tax Relief Act” sales tax.

And, don’t forget the poor who purchase food with food stamps, ARE NOT TAXED.  So the people who are not taxed now won’t be taxed then either; a key fact to keep in mind.

Tennessee has a 5.5% tax on food, and there is no cross boarder shopping as Carl pointed out last night.  Tennessee is the best model this measure could adopt.

Missouri is 48th in the nation for economic growth.  We must change to a system that stimulates a dynamic positive response in our economy.  The “Missouri Taxpayer Relief Act” does just that.

The ‘scare talk’ about taxes on food is just that, a scare tactic.  We can’t avoid the opposition using scare tactics by dropping the sales tax on food and increasing the rate over all, or finding another category to tax.  Scare tactics is all the opposition has.  They will just target something else, lie about it, twist it out of context, blow it out of proportion, and scream to the media and the media will come running like a bunch hogs to a slop a trough like always.  They’re political bedfellows, that’s their shtick, that’s the alliance they have formed, and we can’t change that tactic be giving in to it. We have truth and logic on our side. And eventually truth and logic will win out over time.

If we really want to come together as a the good hearted sincere honest citizens that I know most of us are, we are going to have to quit being manipulated by their lies, slander, and deception regardless of how pervasive it is.  We have got to all step back out of the looking glass and not accept these distorted perceptions created to make right, wrong; and wrong, right…backwards, forward and forwards, backward. We can’t save our state and our nation playing tit for tat in a game of emotional symbolism.  We must look our opponents squarely in the eye, honestly, and come to agreement on solutions based on fact and logic, and what actually works.  That’s the way this country was founded, that’s the only way we will survive as the America we inherited.

John McMillen