The Fair Tax Book to Debut at #1 on NY Times Bestseller's List

The so-called fair tax is a 30% receipts tax, the approx equivalent of a 43% sales tax.

 

I, too, question the numbers.

Likewise, I agree with Ken. A national sales tax is by far more preferred than income taxes. You shouldn't get taxed on your earning habits. You should get taxed on your spending habits.

 

What if your money is very old money--say, 100 years old like some that I know? You don't spend very much because you have had it all forever.

 

Then you don't get taxed on it until you spend it, or until your hiers spend it. A person should never be penalized for saving.

 

If you tax only consumption, you will discourage consumption is my worry. A national sales tax really is government interference in the free market.

The flat tax has two major hurdles: deductions for children and dependents; and deductions for interest payments such as mortgages.

I favor greatly reduced income taxes and a great reduction in the range and scope of federal programs. Whatever happens, nothing is likely to come out of this current Congress, which seems to have decided that a rise in tax receipts demands an even greater outflow of pork from DC.

 

There are state and local sales taxes, and they don't seem to discourage consumption as you fear.

As for government interference, any tax is government interference on the free market.

While that sounds all well and good, most folks want the feds to cut spending everywhere EXCEPT where they live. In fact, here in CA, we elected Schwarzenegger because he pledged to cut Sacramento spending. Now that he's in office, people are getting upset because's he's trying to cut Sacramento spending. Every program he cuts is bet by some union or group complaining that he's taking money away from them. Of course he's taking money away from them. That's what "cut spending" means. Go figure.

 

Ken,
Do you know just how much the tax would have to be to continue to feed the monster in Washington?

 

Then I will limit my spending to food, shelter, clothing, and medicine. I will out-miser the misers.

 

Okay that was funny cmg

 

You buy something for $100 and pay $20 sales tax. The store keeps $100 and sends $20 to the govt. How much must the store charge you to net $100 if the store sends 20% of gross receipts to the govt?

Most people pay more SS tax than income tax. Poor people don't pay any income or SS tax.

 

Store then nets $80, not $100.

So the store collects $126, sends $25.20 to the govt netting $100.80.

Thus a 20% receipts tax is close to a 25% sales tax.

 

That's not the law the "fair tax" people propose.