This course was intimidating from the start, which made me read as
much as I could get my mind wrapped around the different learning
objectives. Has all the ready made me an expert, absolutely not;
maybe scratched the surface. Now at the end of the term, I am still
intimidated by tax preparation but found some understanding regarding
the decisions to be made when choosing which designation is a good
fit for different situations. This course has also confirmed, for me, that
taxation is an overwhelmingly complicated process. It will continue to
use my tax preparer for my filing.
Congress should always be considering an alternative approach to
taxation because in the event the scheduled outcome is not what was
expected there is something in the wing to push forward. Having said
that, “a value-added tax (VAT) taxes goods and services at every stage
of production and sale, the net economic burden is like that of a retail
sales tax (Sammartino, 2020).” If the online articles are correct and the
applied VAT would be instead of income taxes, there would be some
very good benefits. But do these benefits out way the struggles
brought on the low-income families. I could be viewed as another ploy,
by the Federal Government, to make the rich richer and poor poorer.
Enacting a value-added tax or the Fair Tax Act can provide economic
benefits, but at what cost. “Because lower-income households spend a
greater share of their income on consumption than higher-income
households do, the burden of a VAT is regressive when measured as a
share of current income. The burden, as a share of income, is highest
for low-income households and falls as household income rises
(Sammartino, 2020).”
This 9 weeks has certainly been an adjustment but this class has
certainly helped me to have a better understanding of tax. I enjoyed
completing the milestone and completing the research to gather
information to present to the client. In my job we are required to explain
these tax topics in plan language so I really enjoyed that aspect of my
job. It has helped me become a better writer in my work.
Since I work with the US tax system I don't believe Congress should
change the tax system, at least not for Individual taxpayers. I think the
corporate tax system should be overhauled to ensure bigger companies
like Amazon, Walmart, Nike pay more in federal income taxes. They get
a lot tax breaks that help avoid "double taxation."
I don't agree with the Value Added tax system it seems as if the only
people that would end up taking the burden is the consumers. As raw
materials move down the supply chain I feel as the if tax will be passed
down to the buyer of the product, good, or service the price will increase
as the tax is passed along down the supply chain. a This will result in
higher prices for the same good and services. Inflation is already higher
than its ever been, the added value tax will only harm consumers.
The Fair Tax act is certainly radical as it sounds, after 2027 the bill calls
to abolish the IRS, income, and payroll taxes all together. There would be
one tax based the consumption or use of goods and services. Which
sounds reasonable I guess. The state would be responsible for collecting
the taxes and submitting payments to the Treasury, but how would one
keep track of who pays what? What about people who barter and trade
for goods and services? How would they be taxed. This Fair Tax Bill
opens the door to so many questions.
Congress will have to find answers to these and a lot more as the we live
in country a is always changing the way we do business . Currently with a
inflation everything is increasing including sales taxes because sales
taxes are proportionate to the the subtotal of the receipt. So as prices
increase taxes will increase as well. What would be better for taxpayers
is that we will receive our gross pay, and I would appreciate that money
back in pocket.
References a
FairTax Act of 2023 (n.d.). bill.
Orem, T. (2023, February 3). Value-Added Tax (VAT): What It Is & Who
Pays. Retrieved April 4, 2023, from
https://www.nerdwallet.com/article/taxes/vat-value-added-tax
Kurtzleben, Danielle (January 2013) Commentary: Why the U.S.
Should Adopt a Value-Added Tax. Retrieved from: www.usnews.com
H.R. 25 (2023-2024) Fair Tax Act of 2023; 118th Congress. Retrieved
from: https://www.congress.gov/bill/118th-congress/house-
bill/25?q=%7B%22search%22%3A%5B%22%5C%22H.R.+25%5C%2
2%22%5D%7D&s=4&r=1
Sammartino, Frank (May 2020) The Tax Policy Center Briefing Book:
How Could We Improve Our Federal Tax system? Retrieved from:
www.taxpolicycenter.org
