“They will return for the reason stated above.”
So somebody earning $6M/yr currently takes home $5M after Federal Income taxes. He then can buy $5M of goods and services tax-free. Under the FT he takes home $6M, but can only buy $4.6M of goods and services and pay $1.4M of tax. Sounds like incentive to spend outside the country, to me.
“The Fair Tax rate is set to collect as much tax as is currently collected.”
No, it is not. It is designed to replace not just the Income Tax but also the Payroll Tax that pays for Social Security and Medicare. Without a Prebate or exempting education spending, the FairTax would have a base of $12T of spending. A 10% FairTax would therefor collect $1.2T — which is virtually identical to the total amount of income tax presently collected from both Individuals and Corporations.
The Prebate essentially excludes the first dollars spent for everybody — up to the HHS poverty level — which means excluding $2.5T from the taxable base. This means the FairTax rate has to go up from 10% to 13%. Excluding education spending bumps the rate up to 15%. Trying to pay for SS/M pushes the rate up to 23%.
All of the economic benefits of the FairTax come from elimination of the income tax, and especially the corporate income tax with its overhead costs. 10% accomplishes those goals. The Prebate, education exemption, and FICA replacement are just attempts at social(ist) engineering.
He then can buy $5M of goods and services tax-free. Under the FT he takes home $6M, but can only buy $4.6M of goods and services and pay $1.4M of tax. Sounds like incentive to spend outside the country, to me.
Therein lies the deception of the federal income tax code. He doesn't buy anything tax free. You, like millions of Americans, have been duped into not realizing there are embedded taxes in the price of all goods and services at each stage of production because you don't see the hidden taxes. Out of sight, out of mind. Congress likes it that way so no one complain when corporate taxes are raised.
Corporations have taxes imposed on their income. They consider those taxes a cost of doing business, along with the cost of complying with the federal income tax code. They past those costs onto the consumer at each stage of production by including them in the price of everything we buy. The total of those costs amounts to nearly 23% of the price. The Fair Tax will remove those embedded costs by eliminating corporate income taxes and applying a 23% as a separate entry on the receipt. Prices on domestic goods will increase slightly depending the industry. Prices on imported goods will increase the most since they do not have embedded taxes. Regardless, the increase in purchasing power will more than offset any price increase on any domestic products.
No, it is not. It is designed to replace not just the Income Tax but also the Payroll Tax that pays for Social Security and Medicare.
You better tell that to 80 economists who endorsed The Fair Tax, including it being revenue neutral.
An Open Letter to the President, the Congress, and the American people Concerning Reform of the Federal Tax Code Excerpt:"
If passed and signed into law, the FairTax Plan would:Set a federal sales tax rate that is revenue neutral, thereby raising the same amount of tax revenue as now raised by federal income taxes plus payroll withholding taxes"
Without a Prebate or exempting education spending, the FairTax would have a base of $12T of spending. A 10% FairTax would therefor collect $1.2T
Where did you get these figures?
The Prebate essentially excludes the first dollars spent for everybody — up to the HHS poverty level — which means excluding $2.5T from the taxable base. This means the FairTax rate has to go up from 10% to 13%. Excluding education spending bumps the rate up to 15%. Trying to pay for SS/M pushes the rate up to 23%
Again, how did you arrive at these figures?
All of the economic benefits of the FairTax come from elimination of the income tax, and especially the corporate income tax with its overhead costs. 10% accomplishes those goals.
Not even close. Twenty two million dollars of research by some of the leading economists in the country say otherwise.
The Prebate, education exemption, and FICA replacement are just attempts at social(ist) engineering.
The federal income tax code is social engineering. There is a reason Karl Marx included a heavy progressive tax on income as one of the planks in his Communist Manifesto. He understood such a tax discourages people from being productive and will then become dependent on the state for their existence. The Fair Tax stops that socialist engineering in its tracks.