Would there be tax on home sales? Wouldn't the tax benefit for home ownership disapear?
All your questions can be answered here.
http://www.fairtax.org
I pray that I live long enough to say goodbye to the IRS!
As I understand it, there would be a sales tax on new home sales, not used home sales. One benefit is that goods would be taxed only once, rather than multiple times throughout their life of use. Another point is that the tax is only applicable to the goods (house) not the property that had been previously taxed.
I'll defer to the experts for specifics.
The tax benefit for home ownership allows you to pay your mortgage interest with pre-tax dollars (subject to the AMT). Under the NRST, all of your purchases are made with pre-tax dollars.
That would depend on the house; newly built house - yes, previously owned house - no. The reason previously owned/used items are not taxed is that taxes were paid once on them. To tax them again would be double/muliple taxation on that item. That is where you can cut your tax bill, by buying used items and doing repairs/services yourself.
Yes the tax deductions would disappear, but then your property would become more valuable due to more people able to afford it when you decide to sell (they would have more income and would not have to pay any sales taxes on a previously owned home).
There aren't any real tax benefits for home ownership. The benefit to home ownership is that you have the property.
You may be thinking of the tax benefit of a home mortgage. If you are, consider this:
If you pay 20% of your income in taxes, and you have an annual mortgage interest of $10,000 (numbers selected for easy math - not reality checked), then your tax will be reduced by $2,000. You get $2,000 back from Uncle Sam for sending $10,000 to a banker.
If you think of that as a benefit, then I have a great benefit to offer you. Send me $10,000 and I will immediately send you $5,000. That's 5 times the benefit of Uncle Sam's offer. Freepmail me and I'll give you the address to send the check to.
Shalom.