Info on the "Fair Tax" from Fact check.

[napi21]

Advocates of the so-called "FairTax" claimed a 23 percent national sales tax can replace both the federal income tax and Social Security taxes. In truth, the actual rate would have to be at least 34 percent even if it fell on new homes, mortgage and credit-card interest and a host of other products and services not usually subject to state or local sales taxes.

Do NAY of the supporters of this insanity realize what it would really mean if EVERYTHING cost you 34% MORE? I honestly don't think anyone who supports the fair tax really understands it! They know they don't like the income tax and payroll tax and they think ANYTHING ELSE would be better!

[magellan]

1. They won't realize it till it's bleeding their wallet dry

Unfortunately it'll be doing the same to the rest of us as well.

[napi21]

2. I HOPE the majority will realize (or be told) what it really IS before

it gets enacted! Just like the people rebelled against Shrub's privatising of SS!

[ProdigalJunkMail]

3. have YOU read the bill as written?

I would guess not from the verbiage you use...

sP

[napi21]

4. Here's a link to my source.

http://www.factcheck.org/elections-2008/the_whoppers_of_2007.html

"FairTax" Falsehoods


Proponents of the so-called "FairTax," prominently including Huckabee, claimed that a national sales tax of 23 percent could replace both the federal income tax and Social Security taxes, and eliminate the Internal Revenue Service.

In truth, the actual rate of the proposed tax would be 30 percent, when calculated the same way as state and local sales taxes. And it would have to be 34 percent to raise the same revenue as the taxes it would replace, according to a bipartisan presidential commission. The FairTax would, for example, raise the price of gasoline by roughly $1 per gallon at today's prices and cause a $150,000 new home to cost at least $195,000 including the 30 percent tax.

And while the Internal Revenue Service might disappear, two new federal bureaucracies would be needed: one to administer the sales tax and another to keep track of sending out hundreds of billions of dollars in checks every year to compensate taxpayers for the regressive nature of sales taxes. The proposal calls for "prebates" to all taxpayers of all taxes paid on purchases up to the poverty level. That of course would require an IRS-like system to validate each person's income and the amount of "prebate" they are due.

Unspinning the FairTax May 31, 2007

The article on the Fair Tax is a little more than 1/2 way down the page.

Here is a link to how they made their determination.

http://www.factcheck.org/taxes/unspinning_the_fairtax.html

[seasat]

5. It represents a massive shift of burden from the wealthy to middle class

If it is done as laid out, it would end up drastically lowering the effective tax rate (taxes/total income) for the wealthy. It would raise it substantially for most of us. The poor would probably end up about even. The original authors of the plan acknowledge this fact in their book.

They also claim it's revenue neutral by having the government pay the tax on it's purchases but not counting the additional 30% the government would need to spend. They assume that the federal government would cut it's spending by 30% to make up the difference.

David Gale of the Brookings Institute calculated that the fair tax would be above 50% if food, medicine, purchases by government, and other normally exempt purchases were excluded from the tax.

Another fun fact about it is that it was promoted vigorously by the Scientologists because the IRS originally was not going to allow them to be tax exempt like other religions. It's kind of ironic that a Baptist minister is promoting a proposal favored by Scientology.