Income Tax Disaster by Victor Thorn

From http://www.wingtv.net/thorn2006/taxes.html


Income Tax Disaster

by Victor Thorn


Tax Day has passed yet again for another year; and at such times people have a chance to stop and take notice of how much of their money was embezzled by the federal government via a Mob-like tax racket. And yes, you should never forget that it’s your money that the government is skimming off the top.Of course people have been grumbling about this concept for years … no, make that decades … and still a viable solution hasn’t been laid on the table. So, what we’re going to examine today is whether one of the simplest, most effective alternatives to what we currently have is a possibility. But first, we need to realize that prior to 1913 there was no federal income tax. It’s only been for the last 93 years that this system has even been in place. So, how did our federal government survive before then?

Easy – via tariffs, excise taxes, and property taxes. If we eliminate excise and property taxes from the equation, what does that leave us with? The answer: tariffs. Thus, what we’re here to investigate is whether the complete elimination of the IRS and federal income tax could be possible if tariffs were placed on every product imported into this country. How would such a system work? First, we’d have to determine how much revenue was collected via federal taxes (at every level) in a certain year. Then we’d have to determine the dollar value on every product imported into the U.S. for the same year.

In theory, if the IRS collected x amount of dollars via federal taxes, all we’d have to do is determine a certain percentage for every product imported into this country to equal that same amount - then one revenue source would counteract the other.The beauty of this plan is that from the day it was passed, not a single American citizen would ever be taxed at a federal level again. Instead, our nation’s revenue would be derived from products coming into this country. The most obvious benefit, of course, is that taxpayers would have inordinately more money in their pockets because the IRS wouldn’t be filching it from their paychecks.But there’s a glaring error to this notion.

Once we run the numbers, we realize that it simply wouldn’t work like it did prior to 1913. Why? Well, for starters the IRS collected approximately $2 trillion in revenue for fiscal year 2004. Of that amount, $746 billion was derived from direct payroll withholdings (the rest came from corporate taxes, social security, Medicare, etc).So, if we’re only interested in matching the federal payroll withholding amount, we need to come up with $746 billion. But when we look at the imports (goods & services) into this country (2004), the total amount is $1.76 trillion. Here’s where a problem enters the picture.

To equal the amount of $746 billion collected via payroll taxes, we’d have to place a 44% tariff on all imports!Obviously, such a scenario isn’t even remotely feasible, for a 44% tariff would lead to massive hyper-inflation (especially considering how much we import from China alone, and with fuel prices already hitting astronomical levels).Therefore, what can we derive from this simple exercise? Essentially, the federal government has grown so over-bloated, excessive, out-of-touch, and BIG since 1913 that the simple tariff system of a century ago is no longer an option.

Worse, we’re not even bringing social security, health care, and corporate taxes into the picture.On top of that, due to the evil realities of our Federal Reserve (an act also passed in 1913 under Woodrow Wilson), the U.S. government is now forced to pay over $320 billion/year in interest alone on our debt. Think about this ugly reality for a moment. Approximately 40% of the money collected from our payroll taxes goes to paying off a cartel of privately-owned, for-profit bankers who comprise the Federal Reserve. 40%! Plus, since we know that there is no actual Social Security trust fund (it was looted eons ago), it starts to sink in that we have a real mess on our hands, and that any attempt to rectify this situation isn’t going to come easy.If it had been workable, the primary benefit of a tariff system would be twofold:

(1) Americans would have significantly more money in their pockets without federal income taxes being filched from their paychecks

(2) Since imports would be more expensive due to tariffs, U.S. manufacturers would be able to operate on a more even playing field, thus counter-acting the harsh effects of outsourcing

But since our federal government is so criminally irresponsible on a fiscal level, a tariff system that worked so well for over 120 years is now no longer possible. We’re in a hell of a lot of trouble, and all I can conclude is that their IRS Ponzi scheme is broken beyond repair (not to mention all the other shenanigans taking place in D.C.).