[justshutupandtakeit]

I don't know but doubt that it is higher than 15%.

[Your Nightmare]

I don't know but doubt that it is higher than 15%.

For 2004 the FairTax base plus exports (I'm limiting it to that so that there is no squawking from the FairTaxers) was $11,582 billion. That is the total "price" of goods claimed to dropping after the FairTax is passed. The corporate income tax collected in 2004 was $190 billion, or 1.64% of "prices." The employer share of payroll taxes was $383 billion, or 3.31% of "prices." That's a total of 4.95%. Even if all of these taxes were incident on consumers (and virtually every economist believes they are not) that is no where near a 20-35% price drop.

Even if you add a ridiculous $200 billion in compliance costs it still less than 7% of prices. It's $1.9 trillion away from enough costs to achieve a 23% price drop! The numbers don't add up.

The only way pre-tax prices can drop significantly with the FairTax is if nominal wages are reduced!