If non-specified, business will simply give big discounts on price and then make up for it in the interest calculation, as interest is deemed non-taxable. These calculations are highly malleable and can become very complex. Homes will be financed with low-ball prices and high interest rates, and sup-prime mortgages will skyrocket.
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Hey Brainiac ,, if you’re willing to sell me a new Cadillac for $12,000.00 at 100% interest for 72 months or a new 3000 sq/ft home with a pool and a 3 car garage for half price I’LL TAKE IT...
And before the first payment is due I’ll refi at my local CU at 6% and pay you off... (businesses will refi at GE Credit or simply float a bond issue).
You have no faith in the free markets correcting for such shenanigans do you? I guarantee that Boeing will sell only one plane at 75% off before they get burned and never do that again.
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Does it apply to non-profits?
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Without having to worry about losing their tax exemption churches will regain freedom to speak to the issues of the day ,, they will also have greatly increased donations as their parishioners will become wealthier ....
It should be noted that tax ememption for property tax and such is not a federal issue and would not change...
The FairTax would be good for non-profits.
Churches would pay the FairTax on all their purchases that weren’t for resale. Kotlikoff estimated that non-profits, including churches, would have paid ~$36 billion in FairTax last year. A church could pay taxes now and speak about whatever they wanted.