Saturday, July 24, 2010

Politicians, Leaders, and Taxes

We have an abundance of politicians in this country, what we need are a few more leaders. A few more individuals who will legislate and execute policies according to their conscious and common sense (where it exists), not their own interests. Here’s a recent example:

Senator John Kerry is dodging six figures of taxes ($437,500 in sales tax and an annual excise tax of about $70,000) on his 76 foot, New Zealand built yacht by keeping it registered in Rhode Island, which has no boat tax, instead of paying the fees that his beloved Massachusetts levies on its citizens. [source]

His Chief of Staff defended the registration by stating that, “The boat was designed by and purchased from a company in Rhode Island, and it’s based in Newport at the Newport Shipyard for long-term maintenance, upkeep and charter purposes, not tax reasons.” OK, got it, but why can’t it be moored in Newport for maintenance as needed, yet registered in the Senator’s state of residence? If the Senator isn’t trying to avoid taxes, then why not lead from the front, and support the established tax code? He’s clearly a fan of taxes, voting on more than a few occasions to raise them. Surely he’s not living a double standard, is he?

My first point is that I’d put my money on the ‘avoiding taxes’ theory, not the ‘designed, purchased and maintained’ theory… It would be very easy for Senator Kerry to register the boat in MA and set the example (if he truly thought that as a representative of the people charged with ensuring the existence of sound policy). He should play by the very rules that he has helped to create (tax laws in general, not necessarily this specific tax). Now, that being said, he is simply doing what any of us would do, taking advantage of an available tax loop hole, following his instincts, and most likely, his own deep seeded convictions that he’d rather not admit to if he took a good honest look at himself.

My second and broader point is this- politicians are continually caught in the middle between whatever form of logic they personally subscribe to (or the little voice inside- ha), and a hybrid of political necessities, deals, re-election bids, etc… the politics vs. the leadership. It is my opinion that we need some leaders to lead, and try to rise above the politics.

Which leads to my final point (stay with me)- In this instance, if I am correct in assuming that Senator Kerry is in fact taking the opportunity to dodge a half million dollars in taxes and fees, then perhaps deep down in the dark recesses of his subconscious that he doesn't like to admit exist, he feels that the system is unfair and excessive. Who knows. I do think that if more of our law-makers took a few moments to examine the multi-layered tax code, they would admit that we need a system that’s simple and fair. I don’t object to the sales tax, I do object to the excise tax in MA being annual… and it’s criminal that the code first taxes your income, then taxes any interest you should happen to make if you save your hard earned dollars for a large purchase, and finally comes back again and taxes the dollars when spent (then in some cases such as this one, makes an annual visit with an excise tax).

We as a nation will not be able to keep this up. The ever increasing tax burden will eventually cripple our economy. That is why I support the FairTax. The most through and well researched system ever devised. Simple, effective, transparent, and most importantly, the biggest economy stimulator you could ever hope for. I encourage everyone to research it. I just received a second book on the topic and plan to order next a book with a dissenting view in order to hit it from both sides.

My apologies for my tangential path of logic on this one… I skipped around a bit.

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