2009 Stimulus Check

This post is nothing whatsoever to do with the 2009 stimulus check…

I found this rather radical bill whilst looking around the Internet. It dates back to 2001 and was obviously never implemented. The views are not my own and I post it here for discussion purposes only. What do people think? Would this be a fairer tax system?

[Bill Number]
105th Congress
1st Session

In the HOUSE OF REPRESENTATIVES

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; PURPOSE OF BILL; TABLE OF CONTENTS

(a) SHORT TITLE – This Act may be cited as the “American Tax Freedom Restoration Act”.
(b) PURPOSE – Inasmuch as American businesses and the American People who own and work for them have befallen, at the hands of previous Congresses, heavy, unjust, and ever increasing rates of taxation for their labor; inasmuch as the Father of our Declaration of Independence, Thomas Jefferson, stated in his 1801 Inaugural Address: “A wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned”; inasmuch as the Internal Revenue Service itself has become a weapon against the citizens, businesses, and other organizations within the United States; be it hereby purposed to repeal those Federal taxes which are dependent on the reporting of income of individuals, partnerships, and corporate entities of all types located within any of the several United States or Protectorates thereof.
(c) TABLE OF CONTENTS – The table of contents is as follows:

Sec. 1. The repeal of all portions of the Internal Revenue code that pertain to the reporting of or taxation of income from all sources.
Sec. 2. The repeal of income based taxes for FICA and Medicare.
Sec. 3. The transference of the Social Security and Medicare Trust Funds into the General Fund for purpose of appropriations.
Sec. 4. National Retail Sales Tax Implementation.
Sec. 5. Termination of the operations of the Internal Revenue Service.
Sec. 6. Effective date, severability, and additional regulations for the purpose of implementation.

Sec. 1. The repeal of all portions of the Internal Revenue code that pertain to the reporting of or taxation of income from all sources.
Those portions of the Internal Revenue code that pertain to the reporting of or taxation of income shall be repealed, upon the effective date of this section.
Sec. 2. The repeal of income-based taxes for FICA and Medicare. All income-based taxes for FICA and Medicare shall be terminated as of the effective date of this section.
Sec. 3. The transference of the Social Security and Medicare Trust Funds into the General Fund for purpose of appropriations. Inasmuch as the Congress has long applied funds from the Social Security and Medicare Trust Funds to expenditures appropriated as though from the General Fund, and inasmuch as the Government of the United States owes a responsibility of honesty and integrity to the American people, as of the effective date of this section, the Social Security Trust Fund and the Medicare Trust Fund will be transferred into the General Fund for purpose of appropriations. There will, thereafter be no entity referred to as either a “Social Security Trust Fund” or a “Medicare Trust Fund”. Benefits for these programs will be paid from the General Fund on the same basis as they would have been had these in-name-only entities been kept intact, subject to changes just as they would have been had the term “trust fund” remained applicable to these funds.
Sec. 4. National Retail Sales Tax Implementation

(a) Definitions:

(i) National Retail Sales Tax shall mean a tax collected at the point of purchase of a good or service by any entity from a retail business located within the several United States or its Protectorates, hereafter referred to as NRST.
(ii) Retail business shall mean a business entity for which its primary business occupation is the retail sale of goods and services to the general public, to include but not be limited to warehouse/membership clubs, mail order houses, factory outlet stores, re-sale stores, standard retail stores, auctioneers, but SHALL NOT include family garage/yard sales, charitable/civic organization rummage sales and the like.
(iii) Medical care shall include professional attendance for purpose of the health of the patient, services affiliated with such attendance, supplies, medication, regardless of whether or not the medication requires the prescription of a physician, and equipment which can only be used for the treatment or attendance of an illness, injury, or chronic medical affliction.
(iv) Food shall be defined to include nutritional supplements.

(b) As of the effective date of this section, there will be collected a 17% NRST on all goods and services purchased at retail.

(i) Housing and real estate, since they are not retail purchases, are exempt.
(ii) Medical care as defined in Sec. 4. (a) (iii) is exempt.
(iii) Food, other than that purchased in [eateries (i.e., restaurants, cafeteria sections of grocery stores, and etc.)] is exempt. [Author’s note: I am not aware as to the legal terminology which should be used here, but the reader understands the idea I am trying to convey.]
(iv) Items which are not purchased as retail goods, as understood by the common citizen, are exempt. This includes, but is not limited to, insurance premiums, day care services, tuition for education, raw or semi-processed materials purchased by a manufacturer, wholesale purchases made for the purpose of further retail sale.
(v) No entity purchasing goods or services at retail shall be exempt from the Sales Tax, except for the purchase of exempted goods. There shall be no special exemptions for churches, charitable organizations, educational institutions, service clubs or organizations.
(vi) Alcohol and tobacco, including any nicotine delivery system, are specifically NOT exempt.

(c) Collection and payment of the NRST.

(i) NRST shall be collected at the point of sale. In the case of mail order purchase, the sale shall be considered to have occurred in the State/Protectorate to which payment has been remitted.
(ii) NRST shall be remitted to the tax collecting body of each of the several United States and Protectorates by the retail businesses established therein.
(iii) The tax collecting body of each of the States and Protectorates shall remit to the Treasury of the United States 50% of the NRST collected. The remaining NRST collected is for the use of the State in which the NRST was collected, and shall replace all General Fund block grants and appropriations which are not apportioned from other taxes and excises collected by the federal government. (Example: The NRST would NOT replace road-building funds which are appropriated from the Federal Gasoline Tax collected. The NRST would replace all federal welfare/Medicaid block grants.) No federal entity shall dictate the use of the States’ and Protectorates’ portion of the collected NRST.
(iv) The Department of Treasury may establish an internal department for collection of the Federal portion of the NRST, but in no event may Treasury establish an autonomous agency or any other independent entity for the collection of the NRST.

(d) Federal Oversight of Collection of the NRST.

(i) Federal oversight of collection of the NRST shall be limited to review of the records of the State tax collecting bodies. Federal oversight specifically does not include review of the records of individual retail operations.
(ii) Unless there is compelling evidence of willful wrongdoing, the States shall be held harmless in any dispute with the Treasury regarding the amount of tax remitted. If errors are discovered, the State so reviewed shall be responsible only for the remission of the amount of tax due, without interest or penalty.
(iii) In the event that the Treasury of the United States determines that there is compelling evidence of willful wrongdoing on the part of any State, such case will be tried in the Federal Circuit Court which has jurisdiction over said State. In the event that said State is found to have committed willful wrongdoing in the collection and remission of the NRST, the State shall be responsible to remit to the Treasury (1) the amount of NRST due; (2) fees incurred by agencies of the Federal Government in trying the case; (3) Court fees incurred in trying the case; (4) Penalties up to but not to exceed 50% of the NRST due. In the event that the Federal Government does not prove willful wrongdoing, the Treasury shall be liable for the State’s costs incurred in defending its case, as well as court costs, agency fees, and any other fees incurred in the pursuit of said case.

Sec. 5. Termination of the operations of the Internal Revenue Service.

(a) As of the effective date of this section, the operation of the Internal Revenue Service as an agency of the Federal Government shall be terminated. Likewise the functions of Tax Court shall be terminated as of the effective date of this section.

(i) Such personnel as are necessary, not to exceed 10,000 persons, to complete functions of review, reimbursement, collection, and audit for the final year of taxes levied on income shall be transferred to the direct jurisdiction of the Department of Treasury. The Department of Treasury may establish an internal department for this purpose, but in no event, shall it re-establish an autonomous agency for the handling of functions respecting the final year of taxes levied incomes.

(A) All functions regarding the final year of taxes levied on income shall be completed not later than three (3) years after the termination of the levy of taxes on income.
(B) All seizure activities commenced by the Internal Revenue Service which have not been completed lawfully by the effective date of Sec. 5. shall be permanently ceased.
(C) Any unpaid taxes due shall be collected in the following manner:

(1) Three (3) letters will be sent to the taxpayer requesting payment of the taxes due; one per month for three months.
(2) If the amount of tax is disputed, the taxpayer may submit, by certified mail, such documentation as may be necessary to clear the amount due. If the dispute is not resolved in this manner, the Treasury may bring the matter before the Federal Circuit Court having jurisdiction over the state of residence of the taxpayer. The taxpayer will be presumed not to owe tax unless the amount of tax due is proven beyond a reasonable doubt.
(3) If no response is received, the tax amount due shall be treated as any other consumer debt under all applicable credit laws and regulations, with the exception that, if the taxpayer is to be sued for the amount due, the case will be tried in the Federal Circuit Court having jurisdiction over the state of residence of the taxpayer.
(4) In the event that the taxpayer is found to owe tax after a proper hearing in the Federal Circuit Court, the taxpayer shall be liable for the tax due plus interest at the rate being set as Prime Rate by the Federal Reserve Bank, non-compounding. An affordable payment plan will be established for the taxpayer. If the taxpayer, by reason of age, infirmity or inability to self-support, is found to be wholly unable to pay, the tax debt shall be forgiven. In no event shall any taxpayer be compelled to dispose of their primary residence, primary business, or primary mode of transportation to resolve a tax debt.
(5) All cases pending for adjudication in Tax Court on the effective date of this section shall be docketed for the Federal Circuit Court having jurisdiction over the state of residence of the taxpayer.

(D) Any pending criminal proceedings or active investigations regarding the repealed portions of the Internal Revenue Code are to be ceased as of the effective date of this section. No further such prosecutions are to be initiated as of the effective date of this section. Appeals of adjudicated criminal proceedings shall be completed in the shortest possible time consistent with justice.

Sec. 6. Effective date, severability, and additional regulations for the purpose of implementation.

(a) All sections of this Act shall become effective at 12:01 a.m., G.M.T. on January 1, [the year following the bill's passage]. (b) Individual sections and subsections which are challenged in a court of law shall be severable from the remaining sections and subsections, leaving in force such sections and subsections not so challenged.
(c) Congress shall make such regulations as may be necessary to implement the sections of this Act.

I will return to the subject of a 2009 stimulus check soon.