That leaves the possibility that after a Cain administration that a Democrat Congress can hike the tax rates. I guess I’m not the only one with these concerns.

Cain has a lot to prove. If he doesn’t get his message across better in the next debate. I certainly got a bad impression. I doubt other Republicans will be so humble to admit their confusion and find comfort. That will become evident as their concerns go unanswered in future debates, assuming he does not get wise to this.

Perry will rebound somewhat from his economic plan if it is also bold but not as radical as Cain’s 9-9-9 plan and Gingrich is making gains. This race is still in flux. Cain will be vetted.

For simplicity, The following is a conversation some of us just had on another diary.

but it doesn’t result in cheaper things…
windwaker24 Thursday, October 13th at 9:41PM EDT (link)

Maybe I?m missing something, but if EVERYTHING has a 9% sales tax, how can the cost of doing business go down. Every piece of wood, every grain of corn, every piece of paper, every pen, etc. will cost employers more money. They will raise the rates just to keep their desired profit level.

Example:

If I made necklaces as a hobby and it currently costs me $1 for string and $2 for beads, my cost of doing business would be $3. To make a $2 profit, I would sell my product for $5. With the national sales tax, the string would cost $1.09 and the beads would cost $2.18. To keep my $2 profit, I would have to make the price $5.27.

Now, take that on a grander scale. I just don?t see my employer giving me a raise if the chair I sit in, the pen I write with, and the paper I write on costs him more.

XXXX

No, that is not right. You are describing a VAT.
Jim Tomasik Thursday, October 13th at 9:53PM EDT (link)

999 is not a VAT.

There is no tax on the steps of production. You do not pay tax on materials that are part of a product until it is taxed as part of the completed product. That tax is based on the final price of the product being sold to the end user.

The tax does not accumulate along the steps of production.

XXXXX

But things have to be bought from a store
windwaker24 Thursday, October 13th at 10:11PM EDT (link)

before they are made into a finished product. If I go to Home Depot and buy wood and screws, I will get a 9% sales tax on the wood and screws. They don?t know what I?m doing with the items. How do they differentiate between personal use and business use?

XXXXXX

Do you have business license?
Jim Tomasik Thursday, October 13th at 10:33PM EDT (link)

You would have a tax exempt certificate.

This is already a tried and tested method here in TN. It works very well.

XXXXXX

Thank you for explaining
windwaker24 Thursday, October 13th at 10:42PM EDT (link)

I didn?t know about the tax exempt certificate. I?ve never ran a business. Cain still scares me though.

XXXXX

I have and my wife does now.
Jim Tomasik Thursday, October 13th at 10:49PM EDT (link)

I would love to not have to pay H&R block a small fortune every year just to figure out how much money we owe.