mrsat_98
10-12-2011, 07:38 AM
Got this out of a comment section on 999
Dave
the real evil of the 9-9-9 plan; the national sales tax. Since
Herman Cain’s 9-9-9 plan is can’t be immediately instituted due to the
sheer size of our government. Herman Cain has created a series of
phases, that have, in my opinion a low probability of success. Initially
the 9-9-9 plan would be more like a 9-9-25 (or so) plan. So initially
we would need to begin with a National Sales Tax of 22-30% to fund our
government. Which would undoubtedly have detrimental effects on our
economy, as the author of the following scenario suggests.
“Generally, when you purchase a final,
refined good, you are paying for the raw materials that went into processing
it. So let’s use a hypothetical example and compare current tax law with Cain’s
9 / 9 / 9 plan.
Under
current law: As a manufacturer, you go to purchase raw materials.
Suppose your Widget needs a stack of lumber that costs $1000. Because of state
sales tax, that lumber costs, on average, $1070. That cost is built into the
end price of the Widget.
Now, you
manufacture these widgets. To make up for the expense of the Widget, and to
ensure you’re making money to pay for labor, transportation, inspection,
regulation, etc. and profit, your final product costs $2000, and one of your
customers will pay $2140 it. Your customer has to get the Widgets to market,
and charges $3000, or $3210 with final state tax.
Under the
Cain 9% plan: Now the stack of lumber comes with a 16% tax on it (state’s
7% plus 9% for Federal), which makes the lumber cost $1160 for raw materials,
$2320 for the manufacturer, and $3480. Notice a few things here–
A) The
profit margin for the manufacturer has decreased. In order to make up for this,
his end product needs to be more expensive. So let’s call his end price to
market is $2410 to make up, just in revenue lost from paying the extra tax on
raw materials. Notice this now a 20.5% increase in price with built in
taxation– not 16% as figured from the state + the Cain 9%).
B) The end
distributor for customers now also has to make up for that increase in price,
so let’s put that new term at $3750 for recouping what was lost in tax before,
so the end price is now 25% higher. If this distributor is pushing items out to
stores for end-sales, we’re looking at a 30% increase in prices from a 9%
increase due to a NST.” – The Autopsy
The
middle class would suffer greatly from this while the rich would gain.
Cain is a sycophant He runs his big mouth about how has never held elected office, but the fact is he was APPOINTED to Chairman of the Kansas City FED which is a privately held financial terror machine of the elite oligarchy that has Americans under it's thumb.
END the FED!
Ron Paul 2012!
Dave
the real evil of the 9-9-9 plan; the national sales tax. Since
Herman Cain’s 9-9-9 plan is can’t be immediately instituted due to the
sheer size of our government. Herman Cain has created a series of
phases, that have, in my opinion a low probability of success. Initially
the 9-9-9 plan would be more like a 9-9-25 (or so) plan. So initially
we would need to begin with a National Sales Tax of 22-30% to fund our
government. Which would undoubtedly have detrimental effects on our
economy, as the author of the following scenario suggests.
“Generally, when you purchase a final,
refined good, you are paying for the raw materials that went into processing
it. So let’s use a hypothetical example and compare current tax law with Cain’s
9 / 9 / 9 plan.
Under
current law: As a manufacturer, you go to purchase raw materials.
Suppose your Widget needs a stack of lumber that costs $1000. Because of state
sales tax, that lumber costs, on average, $1070. That cost is built into the
end price of the Widget.
Now, you
manufacture these widgets. To make up for the expense of the Widget, and to
ensure you’re making money to pay for labor, transportation, inspection,
regulation, etc. and profit, your final product costs $2000, and one of your
customers will pay $2140 it. Your customer has to get the Widgets to market,
and charges $3000, or $3210 with final state tax.
Under the
Cain 9% plan: Now the stack of lumber comes with a 16% tax on it (state’s
7% plus 9% for Federal), which makes the lumber cost $1160 for raw materials,
$2320 for the manufacturer, and $3480. Notice a few things here–
A) The
profit margin for the manufacturer has decreased. In order to make up for this,
his end product needs to be more expensive. So let’s call his end price to
market is $2410 to make up, just in revenue lost from paying the extra tax on
raw materials. Notice this now a 20.5% increase in price with built in
taxation– not 16% as figured from the state + the Cain 9%).
B) The end
distributor for customers now also has to make up for that increase in price,
so let’s put that new term at $3750 for recouping what was lost in tax before,
so the end price is now 25% higher. If this distributor is pushing items out to
stores for end-sales, we’re looking at a 30% increase in prices from a 9%
increase due to a NST.” – The Autopsy
The
middle class would suffer greatly from this while the rich would gain.
Cain is a sycophant He runs his big mouth about how has never held elected office, but the fact is he was APPOINTED to Chairman of the Kansas City FED which is a privately held financial terror machine of the elite oligarchy that has Americans under it's thumb.
END the FED!
Ron Paul 2012!