conservation of Euros

[Joerg]

krw@att.bizzzzzzzzzzzz wrote:

On Tue, 08 Jun 2010 17:18:22 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 27, 8:56 am, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 26, 8:30 pm, Joerg <inva...@invalid.invalid> wrote:
[snip]

Fair enough. But why not try to fix the current system first?
You mean of 1099s, Schedule C, D, E, and payroll and employer matching
taxes, of Social Security tax, Medicare Tax, Alternative Minimum Tax,
of Earned Income credits, and capital gains tax, each with their own
schedules and computations, each affecting the others?
Yes. We need to look at the tax code now and that from, say, 1960. Then
figure out why the heck it has gotten so complicated. Start rolling
back. One reason is easy and we already know it, it is evidenced in the
most recent 1099 reporting requirements.
I'm just really kind of at a loss. We're talking about replacing 26
op-amps, a few a/d's, a mess of power supplies, a handful of uC's and
a bag of trimpots with ... a resistor.

No. As you said yourself: The states retain their own little fiefdoms.

I didn't think you'd be one to toss the Constitution so easily.

I regard our constitution very highly. Wish everybody would. What I was
saying is that _if_ there is just one state refusing to go with this
flat system it is going to fail in terms of reducing compliance costs.
At least in those states. Completely. Because then there is not going to
be any noticeable reduction in compliance costs for Joe Q.Public.

So they'll keep their 12 opamps, ADCs and power supplies and uCs in
there. Now that a lot of well-off retired folks along with their savings
high-tail it to Cancun or someplace, your lone resistor will eventually
start to glow, turn white and ... *phut*

A lot of states use the IRS as a crutch now. There's no reason to believe
they won't follow suit.

In California that's a bit different. First, they have different
exemption levels. Lower ones, of course. Then they have sales taxes.
Then they have property taxes. Voters luckily staved of the worst there
but in some other states retirees and others still get taxed out of
their homes. You have to undo _all_ of this and politicians of a certain
type will fight that kicking and screaming.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

John Larkin wrote:

On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?

A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...

So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.

... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?

If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme? And the workers get social security for free, meaning
paid by you and me? What if a company exports most of their stuff? Ok,
then we could lay off some politicians to make up for the tax losses,
may not be so bad after all

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[John Larkin]

On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid>
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?

A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...


So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.


Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.


So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?

Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning

paid by you and me?

All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.

John

 

[John Larkin]

On Wed, 09 Jun 2010 08:10:21 -0700, Joerg <invalid@invalid.invalid>
wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
John Larkin wrote:
On Thu, 27 May 2010 11:04:27 -0700, Joerg <inva...@invalid.invalid
wrote:
I don't think it's remotely possible to produce a pair of jeans in
America that retails for $20-30, or a pair of sneakers for $30, or a DVD
player for $49, or ...
Of course not; those industries are gone and won't come back. But we
might build differentially more cars, airplanes, plywood, electronics.
The alternative is to build nothing in the USA.
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.

That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.

I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.


Boeing does.


Of course, you could also say "Ok, we don't tax it when it's delivered
in Dubai" but then you'd be looking at even worse deficits.

Given your unproven assumption above, maybe.


Nothing unproven there. I have data but not at liberty to share. Think
about it: The large engines on most Boeings are from Rolls-Royce, are a
hugely expensive component of a jet airliner and AFAIK still made in
Derby. That happens to be located in the UK and they will in all
likelihood not participate in a "fair tax' scheme

A consumption tax would be neutral as regards RR or GE or P&W. No
taxes would be paid by Boeing, bacause Boeing makes airplanes and
doesn't consume them.

That's the heart of a consumption tax: don't tax people for making
stuff and creating jobs.

Are most Boeing engines RR? There's sure a lot of GE and CFM engines
out there. I think the CFM56 is the biggest seller.

http://en.wikipedia.org/wiki/CFM_International_CFM56

John

 

[Spehro Pefhany]

On Wed, 09 Jun 2010 09:33:11 -0700, John Larkin
<jjlarkin@highNOTlandTHIStechnologyPART.com> wrote:

On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?

A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...


So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.


Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.


So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?

Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?

All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.

John

They've effectively gotten an enormous subsidy from the Japanese
government by 'outsourcing' the wings.

 

[Joerg]

John Larkin wrote:

On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?
A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...

So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?

Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?

All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.

Or move to Cancun and buy your stuff there. Problem solved.

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.

So what would be the answer to my question on whether Boeing would have
to pay this flat tax on the Rolls-Royce engines they buy from the UK?

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

John Larkin wrote:

On Wed, 09 Jun 2010 08:10:21 -0700, Joerg <invalid@invalid.invalid
wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
John Larkin wrote:
On Thu, 27 May 2010 11:04:27 -0700, Joerg <inva...@invalid.invalid
wrote:
I don't think it's remotely possible to produce a pair of jeans in
America that retails for $20-30, or a pair of sneakers for $30, or a DVD
player for $49, or ...
Of course not; those industries are gone and won't come back. But we
might build differentially more cars, airplanes, plywood, electronics.
The alternative is to build nothing in the USA.
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.

That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.

Boeing does.


Of course, you could also say "Ok, we don't tax it when it's delivered
in Dubai" but then you'd be looking at even worse deficits.
Given your unproven assumption above, maybe.

Nothing unproven there. I have data but not at liberty to share. Think
about it: The large engines on most Boeings are from Rolls-Royce, are a
hugely expensive component of a jet airliner and AFAIK still made in
Derby. That happens to be located in the UK and they will in all
likelihood not participate in a "fair tax' scheme

A consumption tax would be neutral as regards RR or GE or P&W. No
taxes would be paid by Boeing, bacause Boeing makes airplanes and
doesn't consume them.

That's the heart of a consumption tax: don't tax people for making
stuff and creating jobs.

If we don't tax that and also not tax all the aircraft delivered to
foreign airlines then two things will happen:

a. Our tax collections will fall short of expectations. Way short. If
that starves the beast a bit that may be ok but I assume they'll simply
raise the rates on anyone else, like usual.

b. Foreign airlines will pay less for aircraft and thus be able fly
tourists for less, hence ...

Are most Boeing engines RR? There's sure a lot of GE and CFM engines
out there. I think the CFM56 is the biggest seller.

http://en.wikipedia.org/wiki/CFM_International_CFM56

AFAIK the RR engines are preferred on really big airplane for fuel
economy reasons.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[John Larkin]

On Wed, 09 Jun 2010 12:37:23 -0700, Joerg <invalid@invalid.invalid>
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?
A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...

So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?

Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?

All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.


Or move to Cancun and buy your stuff there. Problem solved.

Exactly. One less person needing government services. It works.

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.


So what would be the answer to my question on whether Boeing would have
to pay this flat tax on the Rolls-Royce engines they buy from the UK?

As I said, Boeing would pay no consumption tax on engines because they
don't consume them. No OEM would pay sales tax on stuff that they buy
for resale, just like it is now. We pay sales tax on beer and
oscilloscopes, which we use, and none on parts, which we resell.

This concept is too simple and too beneficial, so it will never
happen.

John

 

[Spehro Pefhany]

On Wed, 09 Jun 2010 12:37:23 -0700, Joerg <invalid@invalid.invalid>
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?
A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...

So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?

Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?

All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.


Or move to Cancun and buy your stuff there. Problem solved.

Sure you could live there and have to pay the 15% VAT in Mexico (and
28% income tax on your worldwide income), not to mention "la mordita".

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.


So what would be the answer to my question on whether Boeing would have
to pay this flat tax on the Rolls-Royce engines they buy from the UK?

The only sensible way would be no. Only domestic _consumption_ should
attract a net tax. Whether it's paid and rebated or exempted is an
implementation issues.

 

[John Larkin]

On Wed, 09 Jun 2010 12:42:21 -0700, Joerg <invalid@invalid.invalid>
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:10:21 -0700, Joerg <invalid@invalid.invalid
wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
John Larkin wrote:
On Thu, 27 May 2010 11:04:27 -0700, Joerg <inva...@invalid.invalid
wrote:
I don't think it's remotely possible to produce a pair of jeans in
America that retails for $20-30, or a pair of sneakers for $30, or a DVD
player for $49, or ...
Of course not; those industries are gone and won't come back. But we
might build differentially more cars, airplanes, plywood, electronics.
The alternative is to build nothing in the USA.
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.

That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.

Boeing does.


Of course, you could also say "Ok, we don't tax it when it's delivered
in Dubai" but then you'd be looking at even worse deficits.
Given your unproven assumption above, maybe.

Nothing unproven there. I have data but not at liberty to share. Think
about it: The large engines on most Boeings are from Rolls-Royce, are a
hugely expensive component of a jet airliner and AFAIK still made in
Derby. That happens to be located in the UK and they will in all
likelihood not participate in a "fair tax' scheme

A consumption tax would be neutral as regards RR or GE or P&W. No
taxes would be paid by Boeing, bacause Boeing makes airplanes and
doesn't consume them.

That's the heart of a consumption tax: don't tax people for making
stuff and creating jobs.


If we don't tax that and also not tax all the aircraft delivered to
foreign airlines then two things will happen:

a. Our tax collections will fall short of expectations. Way short.

No. We'll create zillions of jobs, and the workers will buy stuff, and
pay sales tax. If they save some of their pay, that's investment
fodder, also good.


If

that starves the beast a bit that may be ok but I assume they'll simply
raise the rates on anyone else, like usual.

But the sales tax is so *visible*

b. Foreign airlines will pay less for aircraft and thus be able fly
tourists for less, hence ...

Don't they have VAT?

Are most Boeing engines RR? There's sure a lot of GE and CFM engines
out there. I think the CFM56 is the biggest seller.

http://en.wikipedia.org/wiki/CFM_International_CFM56


AFAIK the RR engines are preferred on really big airplane for fuel
economy reasons.

 

[Joerg]

John Larkin wrote:

On Wed, 09 Jun 2010 12:37:23 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?
A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...
So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?
Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?
All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.

Or move to Cancun and buy your stuff there. Problem solved.

Exactly. One less person needing government services. It works.

Sorry, wrong, the guy is still entitled to his social security and
medicare. As long as he has paid up his 40 quarters.

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.

So what would be the answer to my question on whether Boeing would have
to pay this flat tax on the Rolls-Royce engines they buy from the UK?


As I said, Boeing would pay no consumption tax on engines because they
don't consume them. No OEM would pay sales tax on stuff that they buy
for resale, just like it is now. We pay sales tax on beer and
oscilloscopes, which we use, and none on parts, which we resell.

That will result in a serious tax collection shortfall. The more final
products get exported, the more serious the shortfall will be. In other
words then you'd see rather hefty collections swings that depend on
currency exchange rates.

This concept is too simple and too beneficial, so it will never
happen.

That's actually how VAT works in Europe, with one major difference:
Businesses get a full refund on the VAT paid on oscilloscopes. Not on
beer consumed after hours though

I know, because I've lived there and had a business there.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

Spehro Pefhany wrote:

On Wed, 09 Jun 2010 12:37:23 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?
A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...
So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?
Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?
All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.

Or move to Cancun and buy your stuff there. Problem solved.

Sure you could live there and have to pay the 15% VAT in Mexico (and
28% income tax on your worldwide income), not to mention "la mordita".

15% < 23%

And somehow I doubt many people there pay that income tax. Most
certainly not on already saved and taxed income, because they don't have
to. Else, just pick some other destination. Maybe a nice Caribbean
island where there are no winters and the beer is good.

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.

So what would be the answer to my question on whether Boeing would have
to pay this flat tax on the Rolls-Royce engines they buy from the UK?

The only sensible way would be no. Only domestic _consumption_ should
attract a net tax. Whether it's paid and rebated or exempted is an
implementation issues.

That would be similar to the European VAT system and there is no way
you'd ever be able to quench the "needs" of the current tax system with
23% or anything remotely close to that.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Spehro Pefhany]

On Wed, 09 Jun 2010 14:03:36 -0700, Joerg <invalid@invalid.invalid>
wrote:

That's actually how VAT works in Europe, with one major difference:
Businesses get a full refund on the VAT paid on oscilloscopes. Not on
beer consumed after hours though

How about beer consumed during working hours?

>I know, because I've lived there and had a business there.

 

[Joerg]

John Larkin wrote:

On Wed, 09 Jun 2010 12:42:21 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:10:21 -0700, Joerg <invalid@invalid.invalid
wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
John Larkin wrote:
On Thu, 27 May 2010 11:04:27 -0700, Joerg <inva...@invalid.invalid
wrote:
I don't think it's remotely possible to produce a pair of jeans in
America that retails for $20-30, or a pair of sneakers for $30, or a DVD
player for $49, or ...
Of course not; those industries are gone and won't come back. But we
might build differentially more cars, airplanes, plywood, electronics.
The alternative is to build nothing in the USA.
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.

That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.

Boeing does.


Of course, you could also say "Ok, we don't tax it when it's delivered
in Dubai" but then you'd be looking at even worse deficits.
Given your unproven assumption above, maybe.
Nothing unproven there. I have data but not at liberty to share. Think
about it: The large engines on most Boeings are from Rolls-Royce, are a
hugely expensive component of a jet airliner and AFAIK still made in
Derby. That happens to be located in the UK and they will in all
likelihood not participate in a "fair tax' scheme
A consumption tax would be neutral as regards RR or GE or P&W. No
taxes would be paid by Boeing, bacause Boeing makes airplanes and
doesn't consume them.

That's the heart of a consumption tax: don't tax people for making
stuff and creating jobs.

If we don't tax that and also not tax all the aircraft delivered to
foreign airlines then two things will happen:

a. Our tax collections will fall short of expectations. Way short.

No. We'll create zillions of jobs, and the workers will buy stuff, and
pay sales tax. If they save some of their pay, that's investment
fodder, also good.

I don't see those zillions of jobs being justifiable, considering that
all you did is move the tax grab from the frontend to the backend. They
won't materialize. And then what? 23% will not nearly be enough then.

If
that starves the beast a bit that may be ok but I assume they'll simply
raise the rates on anyone else, like usual.

But the sales tax is so *visible*

So is property tax. Has that ever fazed a politician? Remember
pre-Prop13 times?

b. Foreign airlines will pay less for aircraft and thus be able fly
tourists for less, hence ...

Don't they have VAT?

Many do but an aircraft is a business purchase and thus exempt. Way that
works is they pay the VAT and at the end of the month factor that
against all the VAT they collected from fares and such. Then they only
pay the difference or, if negative after such a huge investment, get a
refund.

The only people who'd be stuck with the VAT are retired private pilots
who buy a small 2-4 seater and are unable to come up with a plausible
excuse that it's used for business. They won't by a Boeing though

[...]

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Spehro Pefhany]

On Wed, 09 Jun 2010 14:07:54 -0700, Joerg <invalid@invalid.invalid>
wrote:

Spehro Pefhany wrote:
On Wed, 09 Jun 2010 12:37:23 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?
A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...
So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?
Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?
All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.

Or move to Cancun and buy your stuff there. Problem solved.

Sure you could live there and have to pay the 15% VAT in Mexico (and
28% income tax on your worldwide income), not to mention "la mordita".


15% < 23%

And somehow I doubt many people there pay that income tax. Most
certainly not on already saved and taxed income, because they don't have
to. Else, just pick some other destination. Maybe a nice Caribbean
island where there are no winters and the beer is good.

People often retire to low-cost countries where it is difficult to
make a good living from scratch. Shipping cranky geriatrics off
relieves a big load on the health care system, and is to be
encouraged, IMHO. Sort of a modern form of senilicide. ;-)

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.

So what would be the answer to my question on whether Boeing would have
to pay this flat tax on the Rolls-Royce engines they buy from the UK?

The only sensible way would be no. Only domestic _consumption_ should
attract a net tax. Whether it's paid and rebated or exempted is an
implementation issues.


That would be similar to the European VAT system and there is no way
you'd ever be able to quench the "needs" of the current tax system with
23% or anything remotely close to that.

Well, let's see, total US federal state and local gov't revenue is
said to be about 4.8 trillion*, ignoring deficits for the moment. Say
100,000,000 households spending an average of $60K each per year at
23% tax.. hey that's only about a 3:1 shortfall. ;-)

* http://www.usgovernmentrevenue.com/classic.html

....if government spending is higher than the sum of all personal
income, what exactly does that mean?

 

[Joerg]

Spehro Pefhany wrote:

On Wed, 09 Jun 2010 14:03:36 -0700, Joerg <invalid@invalid.invalid
wrote:


That's actually how VAT works in Europe, with one major difference:
Businesses get a full refund on the VAT paid on oscilloscopes. Not on
beer consumed after hours though

How about beer consumed during working hours?

Not sure how it is these days. Back when I ran a biz over there I never
claimed it but there were IIRC 6-7 different VAT rates. Don't remember
the one for beer but I believe it was deductible if purchased for a
work-related function. Just like catered food. But probably similar to
here, only half of it deductible in order to curb abuse.

[...]

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[Joerg]

Spehro Pefhany wrote:

On Wed, 09 Jun 2010 14:07:54 -0700, Joerg <invalid@invalid.invalid
wrote:

Spehro Pefhany wrote:
On Wed, 09 Jun 2010 12:37:23 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 09:06:45 -0700, Joerg <invalid@invalid.invalid
wrote:

John Larkin wrote:
On Wed, 09 Jun 2010 08:12:32 -0700, Joerg <invalid@invalid.invalid
wrote:

dagmargoodboat@yahoo.com wrote:
On Jun 8, 6:50 pm, "k...@att.bizzzzzzzzzzzz" <k...@att.bizzzzzzzzzzzz
wrote:
On Tue, 08 Jun 2010 16:40:43 -0700, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 27, 2:18 pm, Joerg <inva...@invalid.invalid> wrote:
We already build and export world-class airplanes but Joe Q.Public will
be hard-pressed to get a loan to buy a Boeing 777.
Joan Q. Public doesn't have to--the customer pays Fair tax.
Airplanes, paying tax. That's really cool, isn't it? I mean, the
implied resources used in producing the airplane, taxed at sale.
That's elegant.
That elegance quickly fizzles when the big foreign airlines then buy the
Airbus instead because that is now a much better deal. A lot of the cost
in an airplane is materials.
I'd imagine that most of the cost of an aircraft is money. Many never turn a
profit.
And labor. All the taxes on that labor would be collected in one fell
swoop: workers' income taxes, payroll, Medicare, Social Security,
etc., plus Boeing's corporate income tax, and so forth. Boeing would
save all those costs, and could sell the airplanes for less.

The answer to Joerg's worry about competitiveness is that right now,
today, Boeing's competitiveness is compromised by the system we have--
their price is artificially already inflated by all those hidden
taxes, plus paying the bean counters to count them.

Boeing has an advantage over Airbus in that Boeing's burden is still
superficially lower than Airbus'. Europe is worse. (I'm not sure it
is when our deficit spending is factored in.)

And the expensive Trent engines are imported from England, representing
a sizeabale chunk of the cost of each aircraft. Now how exactly are you
planning to get her majesty to sign up for "fair tax"?
A consumption tax would be paid by anyone who consumes stuff. In the
case of direct imports, that would be the buyer, ...
So, now manufacturers have to pay that for they materials purchases?
That would for sure bring a lot of stuff to a grinding halt in our country.


... ultimately the
airline. As a Californian, you are already obliged to pay sales tax on
anything you buy from out of state.

Sure. But how about that foreign airline?


If europeans subsidize their engine companies and airlines, I suppose
we could make adjustments to keep our companies from being
disadvantaged. There are already international trade agreements that
are supposed to do that, although the europeans cheat a lot.

Exports wouldn't be sales taxed, because the buyer is out of range.
This asymmetry helps the balance of trade.

So you mean if a Boeing 777 is sold to Dubai it's not taxed at all under
the new scheme?
Yes. It's a sort of legal export subsidy.


And the workers get social security for free, meaning
paid by you and me?
All workers would get whatever government benefits from the taxes on
domestic consumption. Since the Boeing workers have jobs, and buy
stuff, they pay too. The cool thing about a consumption tax is that's
it's voluntary: don't want to pay the tax? Buy less stuff.

Or move to Cancun and buy your stuff there. Problem solved.
Sure you could live there and have to pay the 15% VAT in Mexico (and
28% income tax on your worldwide income), not to mention "la mordita".

15% < 23%

And somehow I doubt many people there pay that income tax. Most
certainly not on already saved and taxed income, because they don't have
to. Else, just pick some other destination. Maybe a nice Caribbean
island where there are no winters and the beer is good.

People often retire to low-cost countries where it is difficult to
make a good living from scratch. Shipping cranky geriatrics off
relieves a big load on the health care system, and is to be
encouraged, IMHO. Sort of a modern form of senilicide. ;-)

More Boeing workers, and all sorts of other workers, have jobs if we
can find a way to not drive companies offshore. The new Boeing planes
are assembled in the USA, but major sections are outsourced, many of
them offshore. Corporate taxes and the machinists' union arranged for
that.

So what would be the answer to my question on whether Boeing would have
to pay this flat tax on the Rolls-Royce engines they buy from the UK?
The only sensible way would be no. Only domestic _consumption_ should
attract a net tax. Whether it's paid and rebated or exempted is an
implementation issues.

That would be similar to the European VAT system and there is no way
you'd ever be able to quench the "needs" of the current tax system with
23% or anything remotely close to that.

Well, let's see, total US federal state and local gov't revenue is
said to be about 4.8 trillion*, ignoring deficits for the moment. Say
100,000,000 households spending an average of $60K each per year at
23% tax.. hey that's only about a 3:1 shortfall. ;-)

Problem is, there are no 100 million households that have $60k or
spending power.

Hint: Mortgages

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.

 

[John Larkin]

On Wed, 09 Jun 2010 17:09:49 -0400, Spehro Pefhany
<speffSNIP@interlogDOTyou.knowwhat> wrote:

On Wed, 09 Jun 2010 14:03:36 -0700, Joerg <invalid@invalid.invalid
wrote:



That's actually how VAT works in Europe, with one major difference:
Businesses get a full refund on the VAT paid on oscilloscopes. Not on
beer consumed after hours though

How about beer consumed during working hours?

We pay sales tax on it, but we expense it too, so it reduces our
corporate income tax, which is (in a good year) a lot higher than
sales tax.

John

 

[krw@att.bizzzzzzzzzzzz]

On Wed, 09 Jun 2010 08:35:28 -0700, Joerg <invalid@invalid.invalid> wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Tue, 08 Jun 2010 17:18:22 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 27, 8:56 am, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 26, 8:30 pm, Joerg <inva...@invalid.invalid> wrote:
[snip]

Fair enough. But why not try to fix the current system first?
You mean of 1099s, Schedule C, D, E, and payroll and employer matching
taxes, of Social Security tax, Medicare Tax, Alternative Minimum Tax,
of Earned Income credits, and capital gains tax, each with their own
schedules and computations, each affecting the others?
Yes. We need to look at the tax code now and that from, say, 1960. Then
figure out why the heck it has gotten so complicated. Start rolling
back. One reason is easy and we already know it, it is evidenced in the
most recent 1099 reporting requirements.
I'm just really kind of at a loss. We're talking about replacing 26
op-amps, a few a/d's, a mess of power supplies, a handful of uC's and
a bag of trimpots with ... a resistor.

No. As you said yourself: The states retain their own little fiefdoms.

I didn't think you'd be one to toss the Constitution so easily.


I regard our constitution very highly. Wish everybody would. What I was
saying is that _if_ there is just one state refusing to go with this
flat system it is going to fail in terms of reducing compliance costs.
At least in those states. Completely. Because then there is not going to
be any noticeable reduction in compliance costs for Joe Q.Public.

Sure there will. Any states stupid enough to not get with the program will
starve as their jobs move to states that have. Fast.

So they'll keep their 12 opamps, ADCs and power supplies and uCs in
there. Now that a lot of well-off retired folks along with their savings
high-tail it to Cancun or someplace, your lone resistor will eventually
start to glow, turn white and ... *phut*

A lot of states use the IRS as a crutch now. There's no reason to believe
they won't follow suit.


In California that's a bit different. First, they have different
exemption levels. Lower ones, of course. Then they have sales taxes.

Of course Kalifornica is a "bit different". Though not so different with
taxes. Many states are similar, others rely more on the IRS (VT use "send us
24% of what you sent the fed" model, more or less).

Then they have property taxes.

Sure, that wouldn't necessarily change. Most states use property taxes to pay
for local government, schools, fire protection, and such.

Voters luckily staved of the worst there
but in some other states retirees and others still get taxed out of
their homes. You have to undo _all_ of this and politicians of a certain
type will fight that kicking and screaming.

Again, you want the federal government to *Unconstitutionally* tell the states
how to raise their taxes.

 

[Joerg]

krw@att.bizzzzzzzzzzzz wrote:

On Wed, 09 Jun 2010 08:35:28 -0700, Joerg <invalid@invalid.invalid> wrote:

krw@att.bizzzzzzzzzzzz wrote:
On Tue, 08 Jun 2010 17:18:22 -0700, Joerg <invalid@invalid.invalid> wrote:

dagmargoodboat@yahoo.com wrote:
On May 27, 8:56 am, Joerg <inva...@invalid.invalid> wrote:
dagmargoodb...@yahoo.com wrote:
On May 26, 8:30 pm, Joerg <inva...@invalid.invalid> wrote:
[snip]

Fair enough. But why not try to fix the current system first?
You mean of 1099s, Schedule C, D, E, and payroll and employer matching
taxes, of Social Security tax, Medicare Tax, Alternative Minimum Tax,
of Earned Income credits, and capital gains tax, each with their own
schedules and computations, each affecting the others?
Yes. We need to look at the tax code now and that from, say, 1960. Then
figure out why the heck it has gotten so complicated. Start rolling
back. One reason is easy and we already know it, it is evidenced in the
most recent 1099 reporting requirements.
I'm just really kind of at a loss. We're talking about replacing 26
op-amps, a few a/d's, a mess of power supplies, a handful of uC's and
a bag of trimpots with ... a resistor.

No. As you said yourself: The states retain their own little fiefdoms.
I didn't think you'd be one to toss the Constitution so easily.

I regard our constitution very highly. Wish everybody would. What I was
saying is that _if_ there is just one state refusing to go with this
flat system it is going to fail in terms of reducing compliance costs.
At least in those states. Completely. Because then there is not going to
be any noticeable reduction in compliance costs for Joe Q.Public.

Sure there will. Any states stupid enough to not get with the program will
starve as their jobs move to states that have. Fast.

I think you may be overestimating the ability of some politicians to
even notice when a exodus is happening right under their noses.

So they'll keep their 12 opamps, ADCs and power supplies and uCs in
there. Now that a lot of well-off retired folks along with their savings
high-tail it to Cancun or someplace, your lone resistor will eventually
start to glow, turn white and ... *phut*
A lot of states use the IRS as a crutch now. There's no reason to believe
they won't follow suit.

In California that's a bit different. First, they have different
exemption levels. Lower ones, of course. Then they have sales taxes.

Of course Kalifornica is a "bit different". Though not so different with
taxes. Many states are similar, others rely more on the IRS (VT use "send us
24% of what you sent the fed" model, more or less).

Then they have property taxes.

Sure, that wouldn't necessarily change. Most states use property taxes to pay
for local government, schools, fire protection, and such.

Ah, so property tax remains. State sales tax remains. State income tax
remains. No thanks, then I don't want the "fair tax".

Voters luckily staved of the worst there
but in some other states retirees and others still get taxed out of
their homes. You have to undo _all_ of this and politicians of a certain
type will fight that kicking and screaming.

Again, you want the federal government to *Unconstitutionally* tell the states
how to raise their taxes.

Once more: No. We have several constitutional vehicle to get that done
in the US. Elected representative from the states and voters. Now if a
state doesn't want to do it, fine, but then the voters in that state
will not like a "fair tax" and won't vote in favor it it.

--
Regards, Joerg

http://www.analogconsultants.com/

"gmail" domain blocked because of excessive spam.
Use another domain or send PM.