Publius Huldah
The plot to impose a national sales tax or value added tax
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By Publius Huldah
August 24, 2015

A devilish plot is afoot to impose new national taxes on the American People. It is a masterful piece of trickery because the authorization for the new national taxes is buried within Compact for America's version of a balanced budget amendment to the US Constitution.

Furthermore, the balanced budget amendment does nothing to control federal spending; and transforms our Constitution from one of limited and defined powers to one of general and unlimited powers. 1

Yet this monstrosity is pending in Michigan as SB 306 2 and in North Carolina as HB 366. 3 Legislators in four States, Alaska, Georgia, Mississippi and North Dakota, have already passed it.

Let's look at Sections 1-6 of Compact for America's balanced budget amendment:

It does Nothing to Control Federal Spending

Section 1 allows Congress to spend as much as they take from us in taxes and add to the national debt. That's a good idea?

Sections 2 and 3 permit Congress to raise the debt whenever 26 States agree. States are addicted to federal funds. Will 25 States agree not to take more federal funds?

Section 4 is a joke: Who believes Congress will impeach a President for refusing to "impound" an appropriation made by Congress? Congress won't even impeach a President for Treason.

How Authorization for the New Taxes is Hidden

Section 5 says:
    "No bill that provides for a new or increased general revenue tax shall become law unless approved by a two-thirds roll call vote of the whole number of each House of Congress...." [italics mine]
What is a "general revenue tax"? Section 6 defines it:
    "...'general revenue tax' means any income tax, sales tax, or value-added tax levied by the government of the United States..." [italics mine]
Now go back to Section 5 and substitute the definition of "general revenue tax" for that term:
    "No bill that provides for a new or increased income tax, sales tax, or value-added tax levied by the government of the United States shall become law unless approved by a two-thirds roll call vote of the whole number of each House of Congress...."
There it is: All that's needed is approval of two-thirds of the members of each House and a new national sales tax and/or value added tax is imposed on us. And they can increase it, along with increasing the income tax, whenever they get two-thirds of the members to vote for it.

Section 5 also permits Congress to make laws to impose a new "end user sales tax" 4 which would replace the income tax – this "end user sales tax" is passed by a simple majority of both houses.

So! Compact for America's balanced budget amendment provides two options to Congress:
  • Two-thirds of the members of both Houses can impose a new sales tax and/or value-added tax in addition to the income tax; or

  • A simple majority of both Houses can impose "a new end user sales tax" which replaces the income tax.
Which option will Congress choose?
    Our Constitution Doesn't Now Authorize a National Sales Tax or Value-added Tax
Article I, §8, clause 1 says:
    "The Congress shall have Power to lay and collect Taxes, Duties, Imposts and Excises..."
Principles of Compact for America say this clause already authorizes a national sales tax or value added tax. Board Vice-President Chip DeMoss said on Feb. 12, 2014:
    "a national sales tax would be an "impost" (defined as a tax or similar compulsory payment) that is authorized under Article I, Section 8, Clause 1..." [see comment 19].
We may not properly use DeMoss' redefinition of "impost"!

We must use the definition of "impost" our Framers used: The Federalist Papers say an "impost" is a tax or duty on imports. Type imposts in the search box [at the link] and the Papers discussing imposts will come up. See for yourself that an "impost" is a tax or duty on imports.

Webster's 1828 Dictionary defines "impost" as:
    "...Any tax or tribute imposed by authority; particularly, a duty or tax laid by government on goods imported, and paid or secured by the importer at the time of importation. Imposts are also called customs."
Do you see?

National sales taxes and value-added taxes are also not "excise" taxes. Excise taxes are a tax on a unit of goods – such as the infamous whiskey excise tax of 1791 which led to the Whiskey Rebellion. 5 It imposed a flat tax per gallon. The tax was payable for domestic whiskey at the distillery (§17 of the Act) and the casks were numbered and marked to show the tax had been paid (§19 of the Act).

"Taxes" at Art. I, §8, clause 1 refers to the apportioned direct tax provided for at Art. I, §2, clause 3 of our Constitution.

Our Framers were specific about the kinds of taxes Congress is permitted to impose. Congress does not have the power to impose any kind of tax it wants. Our Framers limited Congress' taxing power to:
  • the apportioned direct taxes at Art. I, §2, clause 3;

  • the duties or imposts on imports at Art. I, §8, clause 1; and

  • the excises at Art. I, §8, clause 1.
A sales tax is none of the above. A sales tax is a percentage of the retail price of goods. A value-added tax is a "turbo-charged national sales tax on goods and services that is applied at each stage of production, not merely on retail transactions" and raises a "gusher of revenue for spendthrift governments worldwide."

We have never had a national sales tax or value added tax in this Country. Why? Because they are not authorized by the Constitution.

We were manipulated into supporting the 16th Amendment. We were told the income tax would "soak the rich" – and the envious drooled at the prospect.

And so again today, statists are seeking to trick us into supporting a national sales tax or a value added tax: first, by concealing it within the verbiage of the bill; 6 and then, once the trickery was exposed, by claiming the Constitution already authorizes these new types of taxes.

There is a Better Way: Downsize the Federal Government!

Our Constitution limits federal spending to the enumerated powers. The list of objects on which Congress may lawfully spend money is a short list. See the list HERE.

Most of what the federal government does today is unconstitutional as outside the scope of the powers delegated by the Constitution. Let's cut federal spending by downsizing the federal government to its enumerated powers and constitutional limits.

Endnotes:

1
Congress' spending is limited by the enumerated powers: If an object is on the list of enumerated powers (e.g., the patent & copyright office authorized by Art. I, §8, cl. 8), Congress may lawfully spend money on it. That's how our Constitution already controls federal spending.

All versions of a balanced budget amendment change the constitutional standard for spending FROM whether an object is on the list of enumerated powers TO a limit on total spending where Congress may spend money on whatever they or the President put in the budget. This is what transforms our Constitution FROM one of enumerated powers only TO one of general and unlimited powers. And that is the true purpose of a balanced budget amendment. It has nothing to do with limiting federal spending – the pretended spending limits are fictitious since they may be waived whenever the feds [and 26 of the States] want to waive them.

2 Leon Drolet's article of July 10, 2015, and Sam Easter's article of July 8, 2015, about SB 306 pending in Michigan don't mention the new national taxes.

3 Matthew Burns' article about the hearing on HB 366 before N. Carolina's House Judiciary Committee (which passed HB 366) doesn't mention the new national taxes. Burns quotes the Bill's sponsor, Rep. Chris Millis, as saying the problem is "Washington is unwilling or unable to limit itself." So the solution is to massively increase Congress' taxing powers?

4 "End user sales tax" is not defined in the balanced budget amendment.

5 Apparently, the practice of tarring & feathering "revenuers" began with the Whiskey Excise Tax.

6 The trickery was exposed over a year ago HERE. Since then, they have claimed the Constitution already authorizes the new taxes. Are we too gullible to be free? PH

© Publius Huldah

 

The views expressed by RenewAmerica columnists are their own and do not necessarily reflect the position of RenewAmerica or its affiliates.
(See RenewAmerica's publishing standards.)

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Publius Huldah

Publius Huldah is a retired litigation attorney who now lives in Tennessee. Before getting a law degree, she got a degree in philosophy where she specialized in political philosophy and epistemology (theories of knowledge).

She now writes extensively on the U.S. Constitution, using the Federalist Papers to prove its original meaning and intent. She shows how federal judges and politicians have ignored our Constitution and replaced it with their personal opinions and beliefs. She also shows how The People can, by learning our Founding Principles themselves, restore our Constitutional Republic.

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