By Tom Quiner
The Fair Tax is a national sales tax designed to replace ALL other taxes.
It would replace a tax on productivity (the income tax) with a tax on consumption. The plan has been impressively researched at great expense. Advocates for this tax emphasize that it is NOT tax reform. It is tax replacement.
All of the following taxes would be eliminated:
√ federal income taxes
√ personal taxes
√ estate taxes
√ gift taxes
√ capital gains taxes
√ alternative minimum taxes
√ Social Security taxes
√ Medicare taxes
√ self-employment taxes
√ corporate taxes.
So, what WOULD be taxed? FairTax.org tells us:
“The FairTax is a single-rate, federal retail sales tax collected only once, at the final point of purchase of new goods and services for personal consumption. Used items are not taxed. Business-to-business purchases for the production of goods and services are not taxed. A prebate makes the effective rate progressive.”
The key words are “only once.” A new car IS taxed; a used car isn’t, since it has already been taxed.
Same goes for consignment shops selling used clothing. The clothes were already taxed the first time they were sold.
A Quiner’s Diner reader expressed a legitimate concern on the plan in my previous post on the subject (“The time has come to abolish the IRS. Here’s how …”). Since the proposed Fair Tax rate is 23%, wouldn’t that amount to a tax increase on most working class families? After all, most people fall into the 15% tax bracket. The answer is no, the Fair Tax would not be a tax increase. In fact, it would probably amount to a tax cut, explains FairTax.org:
“Most people are paying that much or more today — much of it is just hidden from view. The income tax bracket most people fall into is 15 percent, and all wage earners pay 7.65 percent in payroll taxes. That’s 23 percent right there, without taking into account the 7.65 percent employer matching! On top of that, you have to add in the business taxes and associated compliance costs passed on to consumers in higher prices.”
The tax code currently stands at 4 million words. That’s about five times the length of the Bible. Congress tinkers with it constantly, usually increasing its complexity as it taxes new things; at the same time, they exempt others that have more persuasive (richer) lobbyists.
The Fair Tax eliminates the tax code. It strips away power from the politicians and their lobbyist buddies and puts the power where it belongs: in the hands of the people.
If you’re sick of a corrupt IRS bullying the little guy at the behest of the elites who control government, you should support the Fair Tax.
Spread the word on Facebook, Twitter, and other forms of social media. The time has come.