Saturday, June 04, 2005

Posted at Americans for Fair Taxation

Increasing the Tax Base - Group 3

Illegal Aliens. One of my favorite topics. Illegal aliens are usually, although not always, paid in cash, so payroll taxes are not taken out. I differentiate immigrants here as “illegal” because those who are here legally are paying taxes through a payroll deduction. I am assuming that the illegal aliens we are talking about here is the immigrant from a depressed country and there are here to earn money to help their families survive back in the old country. And yes, I know that is not the only reason illegal aliens are in the United States, that’s a topic for another time and place. I may have problems with the “reason” they are here, but I am more concerned with the “way” they are here. But that too, is a topic for another time and place.

The illegal alien generally doesn’t have a traditional job. They are usually day laborers and paid in cash. They are gardeners, hotel maids, dishwashers, mechanics, nannies, and in other jobs where the employer is willing to pay them in cash. Are they bad people? Of course not. That’s not the point. Even though they are here and try to “fly under the radar” they will need public assistance in the form of social services. At some time or another, because they work at minimum wage jobs, someone will help them to apply for welfare, WIC, Medicaid, and any other number of social welfare programs that my liberal side and my fiscally conservative side fight over. These programs are all paid for through my (and your) tax dollars.

Under the Fair Tax, illegal aliens would automatically be added to the tax rolls every time they made a purchase. Here in Manatee County we have a large Hispanic population. I see Hispanics in every store I shop in. So, my point is, under the Fair Tax, they would pay a tax every time they shopped, just as I would.

We started out with the wage-earner group and added the criminal element, tourists and now illegal aliens. Who will be in the next group?

2 comments:

KipEsquire said...

The idea that there would be no evasion under a sales tax is one of the most bizarre, naïve and irrational claims in politics today. It is almost guaranteed that there would be far more evasion, as all you would need is a wink and a handshake. And given that the sales tax would have to be at least 44% and possibly as high as 82% to remain revenue-neutral, the incentive is overwhelming.

Illegal aliens, who tend to purchase in cash, locally and among themselves, would be at least as likely and able to engage in evasion as everybody else.

Kitten said...

Hi Kip! Thanks for visiting and commenting. Why do you think that there could be more evasion than there is today? Employers pay under the table to avoid taking taxes out, people just fail to file taxes, and there are those who underreport income. Under a sales tax, when you go to a register the sales tax is automatically added to the sales price. I agree that there is always some chance of paying in cash in the back of the store so that the transaction doesn't go through the register, but I don't think that would be "far more" evasion.

If I ever said "no" evasion, I spoke wrongly. Of course there would be those who want to get around the government just because. But I do stand by my assertion that there would be far less evasion under a sales tax than under the current tax code.

I would like to know where you got your figures for 44% and 82%. The highest I've ever heard was 30%.

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