Critics of FairTax?

Question

What is your opposition to the FairTax (www.fairtax.org)? Have you actually read the plan or are you just going by what some politician has said?

Tax profesionals are usually educated, they should have no problem finding other work.

How is the middle-income taxed more using the fairtax? Removal of the embedded taxes and replacement with the one time retail tax only changes the cost of items minutely and when combined with the fact that those middle income workers will not be having any federal withholdings taken from their pay actually tips the balance in their favor. And once the embedded taxes are removed, competition at those levels will cause prices to go down, ultimately helping everyone.

Where did you get 30%? The current embedded taxes are approximately 22%. The new FairTax is 23%. You'll have to show me the math that gets 30% out of those two numbers.

Who is enforcing the price drop? Market pressure. Companies are always going to try to undercut their competitors. That's how capitalism works. And if they try to not "lower the prices in the full amount of what they are saving", their competitors will and they'll either go out of business or be forced to follow suit.

You only mention the prebate, what about all of the federal withholdings that are no longer taken out of payroll?

Answer 1

The biggest problem with the "Fair Tax" system is that it would put all of the tax professionals out of business. Who would send their kids to college. And yes I have read most of the plan.

Answer 2

Yes, I have read the book and probably my biggest objection would be that even with the "prebates" in place, once you move beyond that "prebate" level this is a regressive tax that punishes the "mid-income" taxpayer HUGELY!!!! Which is why I'm always amazed to see the rallys full of "mid-income" supporters - Do THEY not understand the plan or are THEY just going with what some politician has told them?

Edit: Nearly 30% is minutely? - I don't think so. Who is enforcing the "lowering of prices" by businesses prior to the end tax?? I'm not sur ethat they will feel the need to lower the prices in the full amount of what they are saving!! And if they don't...If you are a middle income tax-payer that is beyond the prebate but spend nearly all you make that means your tax rate is now in the high 20% to 30% of your income. If you are a high income taxpayer (obviously above the prebate) and you spend 50% of what you make that means your tax rate is now in the mid-teens.

Regressive and UN -"fair".