Look at all the jobs that would be created by auto, boat and plane mechanics that would be needed keep all the used vehicles going!!!!

Who says? Why would the banks drop interest rates b/c their overhead falls?

As I posted, this was straight from Fairtax.org. Why would they not fall?

As I posted, this was straight from Fairtax.org. Why would they not fall?

 

I don't understand the logic that says they would. What incentive would the bank have to lower their rates?? If they are profit making entities, the lower overhead would simply raise profits. The interest rate would still be based on the prime.

 

It is just big jump to assume somebody would lower the rates.

I don't understand the logic that says they would. What incentive would the bank have to lower their rates?? If they are profit making entities, the lower overhead would simply raise profits. The interest rate would still be based on the prime.

 

It is just big jump to assume somebody would lower the rates.

I would think competition would likely drive them to lower the rates. Under this new tax, competition would be quite healthy.

I would think competition would likely drive them to lower the rates. Under this new tax, competition would be quite healthy.

 

how is the competition any different than it is now?

 

i am not saying that the rates won't go down, but the logic the argument is based on is weak.

 

It is like you guys arguing against the CBO and the HCRA. You say it has to make some assumptions which may not prove to be true.

 

Tell me what it ACTUALLY does, not what you (not you specifically, you generally) think it might do based on the business decision of bankers.

how is the competition any different than it is now?

 

i am not saying that the rates won't go down, but the logic the argument is based on is weak.

 

It is like you guys arguing against the CBO and the HCRA. You say it has to make some assumptions which may not prove to be true.

 

Tell me what it ACTUALLY does, not what you (not you specifically, you generally) think it might do based on the business decision of bankers.

I don't know it this will help you or not.

 

First, interest rates drop quickly by approximately one-quarter. Interest rates include compensation to the lender for the tax that they must pay on interest you pay them. That is why taxable bonds bear a higher interest rate than tax-exempt bonds. When the tax on interest is removed, interest rates will drop toward today’s tax-exempt rate.

 

Second, under the current system, savings and investments are taxed. Under the FairTax, savings and investments are not taxed at all. As Americans save more money, the pool of funds in lending institutions grows. When you add to this the flood of capital currently trapped offshore, we realize a huge increase in the pool of capital, thereby causing the cost of borrowing funds to drop.

Who says? Why would the banks drop interest rates b/c their overhead falls?

I forgot to post this part, the entire explanation was addressing the home mortgage deduction.

 

The FairTax has positive effects on residential real estate far beyond this narrow question. Today’s homeowners, if they itemize (and 70 percent do not), pay their interest with post-Social Security/pre-income tax dollars. They then pay their principal with post-SS/post-income tax dollars. Those who do not itemize get no advantages at all. Under the FairTax, all homeowners make their entire house payment with pre-tax dollars.

Bump this back up.

 

Everyone gets a prebate, and the strain on the middle class would be reduced.

 

This needs to be pushed and passed.

I like Steve Forbes flat tax, first 43,000 is tax free, then rest is around 18%, no deductions. No special deals. Your tax return is a post card. Simple and fair.