I’ve been seeing and hearing quite a bit about a new proposal from House GOP members about abolishing the IRS and implementing a 30% sales tax*. On its face it is an absurd prospect filled with scare tactics talking points and falsehoods, or as we like to call them: LIES.
I’m including three links as well as a great video that explains exactly what’s in the bill at the end. First, I’m glad to give you my opinion on this as someone who pays the bills for my household and is soon-to-be preparing our taxes and who spent the weekend shopping with my family for our household needs.
A 30% tax increase is CRAZY. It’s as simple as that. We’re an average family of five, one of whom lives on his own (but who often comes to dinner). We are still materially supporting two other children (regardless of their ages), feeding, clothing, entertaining. We live paycheck to paycheck, and some months we don’t have anything at all until the next paycheck. It varies.
This weekend we went to several places and took our daughter to breakfast on Sunday. I’m going to round up what we spent:
Breakfast out: $63
Department Store: $68 (this included groceries, medicine, and clothing)
Walmart: $6 (groceries)
McDonald’s: $3 ($1 drinks)
Sally’s Beauty Supply: $24 (school supplies)
Target: $164 (personal care/hygiene, toilet paper, school supplies, groceries, toy on clearance)
All of these purchases include state and county sales tax, which in (our part of) New York is 8%.
New totals based on an additional 30% federal sales tax (on goods and services):
- Breakfast: $81.90
- Dept. Store: $88.40
- Walmart: $7.80
- McDonald’s: $3.90
- Sally’s: $31.20
- Target: $213.20
For a grand total increase of: $98.40 for one day’s shopping. ONE DAY.
Republican House Members claim that this will abolish the IRS and eliminate 87,000 “weaponized” IRS agents who were increased in a recent bill that President Biden signed last year. This is a falsity that they’ve continued to lie about. Those 87,000 IRS agents will not be armed (as they’ve claimed) and they will not be coming to your house, but increasing the assistance the IRS gives to its clients every day. I’ve been on the phone with them previously and have always felt helped. They’re also supposed to help reduce the backlog to avoid situations like we experienced in 2021 when we filed in May and didn’t receive our refund until the end of December.
This National sales tax will be on goods AND services, where the current state formula is on primarily good with only a few services paying sales tax. This tax on services would include babysitters, which is explained in the video. This will also be on top of the state and local taxes paid on goods currently.
One of the things they claim is that 40% of households pay no form of income tax, and for those family’s eligible, there will be a monthly rebate based on a formula in relation to the poverty line and family size, but you would still have to pay it upfront at the time of purchase. If you’re eligible for the rebate, that is.
This creates an enormous burden on the poor and middle-class working families. The rich will always find ways to get around this tax, simply by leaving the country to do their shopping. Plus the fact that they can afford the increased pay out.
If it wasn’t obvious yet, I am definitely against this bill, and will be contacting my Congressman’s office to let him know he has my support to vote NO when this comes to the floor.
*Republicans claim that it isn’t a 30% increase, that it’s a 23% increase. That is because of how they are doing the math: $30 out of $100 is 23%. The video does an excellent job of explaining this.
Don’t Buy the Sales Tax (from the Brookings Institute)
TaxVox: Federal Budget and Economy
SNOPES: Is GOP Freedom Caucus Pushing for a 30% Sales Tax in US? [SPOILER ALERT: YES]
Video from Brian Kim of Clear Value Tax:
Adding Politics Girl’s Take here: