What do you think of the FAIR TAX PLAN?

Mike Gravel (D) and Mike Huckebee (R) are both supporters of the Fair Tax and are making it one of the main parts of their campaign. Duncan Hunter (R) and Tom Tancredo (R) are Co-Sponsors in the House and support the Fair Tax. Ron Paul (R) is not a Co-Sponsor, but would vote for it in the House if it comes up for a vote. Fred Thompson (R) states it is a good start, but ... He and John McCain would sign it if either is President and it has passed both the House and Senate.

About 90% of American voters that are aware of the Fair Tax and understand it are in favor of it. It will reduce the taxes paid by low and middle income people and all wage earners. It totally untaxes all legal residents up to the poverty level through the prebate.

While the vast majority of the discussions regarding "how much income tax a person pays" only considers their personal income tax filed report. All wage earners must also consider the payroll tax (SS and Medicare) that is taken out of their paycheck. Then there is the embedded tax costs of all businesses in everything that the individual buys! It does not matter whether it is new or used, the business includes tax costs as a "cost of doing business" in the sales price of the product or service. This is anywhere from 19-26% of the price of the goods! The average tax paid by middle income people is between 35 to 45% (inclusive percentage) or 53-81% (exclusive percentage). Personally I definitely would prefer to pay 23% (inclusive)/30% (exclusive) Fair Tax rate!

There are two major groups that oppose the Fair Tax. They are those that have a vested financial interest in maintaining the current income tax code (lobbists and those with wealth invested is tax loop holes etc) and politicians. The politicians would not be able to hide the true amount of tax that we pay by taxing businesses and they would lose the power and control they have for social engineering. (Plus, many of the politicians are also included in the first group)

The others that oppose the Fair Tax (many Americans) really do not understand the Fair Tax and have only been listening to the two groups mentioned above.

It's an interesting idea. One problem I see is that it relies on the states to collect the tax. The states have always had trouble collecting on internet transactions.

The other problem I see is the same one we see with the current Federal Income Tax. As noted on the website, the income tax started out as being fairly flat and very simple, but Congress tinkered with it over the years. I can easily see this happening with the Federal Sales Tax as well. We have a similar problem with the sales tax in my state. It was decided that we should exempt food so as to make less of a burden on the poor. Then someone decided that things like candy and pop aren't necessities so they SHOULD be taxed. Then it broke down into things like buying a frozen chicken in the supermarket vs. buying a cooked chicken from the deli department of the same supermarket. There's no guarantee against that sort of tinkering.

I also see a short-run problem with adjusting the economy to this tax. Right now, people don't give a second thought to charging a $300 Ipod on their credit card because they want it RIGHT NOW. A 23% sales tax might give people pause over such purchases. People won't be as interested in the latest cell phone, the latest flat screen t.v., or in making the switch from one form of electronic media to another (like the change from VHS to DVD we experienced over the last decade). People will want their goods to be durable and will be more reluctant to buy "the latest thing," especially if the bugs haven't been worked out of it yet (think Windows Vista).

Over the long haul, that's probably good in some ways, but in the immediate future in would cause drastic adjustments for corporations who make their money by churning out something new every year that makes last year's item obsolete.

You'd also eliminate a lot of jobs in the short run: ninety thousand IRS agents, all those tax lawyers and C.P. A.'s, everyone who works for H & R Block, and the people who develop and market do-it-yourself tax software. If things went badly in the first few months, people might storm the Capitol building with torches and pitch forks demanding we go back to the old way.

Still, if we could survive the initial adjustments, I think it would be worth trying.

I'm not a supporter of the FairTax because I don't believe that a revenue-neutral system is a good thing. The government currently has far too much money to go out and waste on projects such as the distraction War in Iraq ($1 trillion to distract the America people from the fact that the government has miserably failed in their efforts to catch the people who actually attacked us on 9/11, namely Osama bin Laden and al-Qaida), the $1 million Woodstock Museum, and the Bridge to Nowhere (not to mention all the Robert Byrd pork barrel projects in West Virginia). Why not simply eliminate the IRS? Sure, the big government liberals and big government conservatives will complain and fight you every step of the way, but the vast majority of the American people would certainly be willing to take 1 major source of funding for government waste away (especially since the legitimate Constitutional functions of government at the federal level can be paid for by a light tariff on imports or other indirect taxes).

By the way, Ron Paul's preferred solution is to replace the IRS with nothing, but he would vote for the FairTax if it came up to a vote.

No tax can be fair. What one considers fair will always penalize others. Case in point a Flat Tax. If it were set at 10% for everyone, a person making $1 billion a year would pay $100 million in taxes. I think that would actually be more than presently paid. An the other end a person making $10,000 a year would pay $1000. The result for them would be they might not be able to pay rent, utilities, feed the household, you get the idea. Fair no. All that can be done is to distribute the load of taxes so as not to destroy people in one group or the incentive of people to make money and create economic prosperity. Give the solution to that and I would give you my vote.

Yes I would vote for a person who supported the Fair Tax. Ron Paul supports the Fair Tax.

The plan is a good one as far as I am concerned. The tax rate is 23% on new goods. Every household in the country gets a "pre-bate" every month based on the number of people in the household to cover the basic necessities of life. There is no federal withholding of ANY type-social security, medicae or income tax. You do not have any federal taxes placed on interest or investment income. The plan does not hurt the poor as some claim; it actually helps them by giving them more money to spend. And as long as they don't buy new cars and new clothes every month they will actually be better off.

And the best part of all is that EVERYONE pays...tourists and illegals will be paying the tax too. There would be no pre-bate for the illegals or tourists since they would not have a valid SSN.

I don't think we will ever find a system that pleases everyone... though i would say that the system right now is not too great either, because i don't think most people realize how much taxes some people pay. and if we use the system that rengo guy wants, people making over 150,000 single and 200,000 jointly will pay almost half of that in gov't, and state taxes. so obviously, for them thats not very fair to make 200,000 and end up with 100,000. i think that this plan is pretty fair, but its definitely not perfect.

The poor benefit the most. Do not listen to -the thing- . The poor actually get a rebate check each month to offset the taxes. The only people that will have issues are the middle class with a lot of debt. I would absolutely vote for this plan.

The Fair tax, taxes new purchases only.

"The Thing" doesn't understand finance. The income that is not spent (and therefore not taxed) is invested to produce more income. These investments provide jobs, fund mortgages, and support benefits for everyone.

The biggest benefit is that it eliminates all the loopholes.

thing

fair tax does not hurt the poor. it helps them. individuals and families below the poverty line receive a pre-bate check each month equal to what they would have paid in taxes and enough to raise them above poverty level.

By doing away with the bureaucrats of IRS would help balance the US budget....pay for entitlements..etc,

Duncan Hunter...