Wouldn't the "fairtax" idea be better if it didn't have all that bureaucratic rebate system in its plans?

Question

Woudn't it be better just to have certain items exempt from any sales tax, such as groceries, medicine, clothes under $50, and school textbooks.
I think having a sales tax increase could allow us to cut out income tax.
It would also tax tourists and illegal immigrants, and all "cash-only" folks when they go shopping.
I would like to know whether there would be enough revenue then to not have to cut GOOD government spending, like for education, healthcare, roads, fire, police, teachers, defense, etc. Or, would the tax burden weigh heavily on the poor and allow numerous loopholes for the bigwigs.???

Well, if the prebate would be a card that exempts the poor from a certain amount of taxes, and it's maybe issued once a year, revised when necessary, not every month, it would be less complicated.
As for the statement that it's not a sales tax, it's a pre-sale tax of 22%; it that tax is raised, the retailers will simply raise the price. What do you think they are going to absorb the loss?

And I don't want to get rid of Social Security. I would like to see national health care that could be more cheaply done than Medicaire.

Answer 1

Rest assured, all new tax ideas coming through are just for milking more for the out of control spending congress.

Answer 2

Actually the prebate pays for the taxes up to the poverty line. If you start putting in exemptions then every body and their mother will want their products/services exempt.

Liberals will say the fair tax will hurt the poor because they spend a greater percent of their income on basic items. They don't include the prebate in their talking points.

Liberals also say that the rich will end up paying less because they have so much money lying around. Guess what, its the rich folks that can afford those high paid accountants and tax experts to find each and every loophole in our current tax system which cuts down on the amount of tax they pay. Under the fair tax all of those loopholes are gone. How many people do you know order cavier, lobster and fillet Mignon at a restaurant? Rich folks tend to spend more on food, clothing, and cars than poor folks do.

The goal here is to have a tax that EVERYONE pays that is transparent. So everybody knows that Bill Gates pays the same rate as Bob the Builder.

Under the fair tax, all of that income tax instantly goes away. No more FICA, FITW, social security, and medicare taxes. All of it gets rolled into an inclusive tax, which we pay on any new products/services. No more IRS, death tax, capital gains tax, no more double or triple taxing our income. All of this for the price of the repeal of the 16th amendment.

Edit: The fair tax doesn't get rid of social security, those taxes are included IN the fair tax. This tax system is revenew neutral meaning it REPLACES all of the taxes we now pay with the fair tax. Also the prebate is paid monthly not yearly.

Answer 3

The FairTax Plan is a nonpartisan national grassroots campaign to replace the federal income tax system with a progressive national retail sales tax. It provides a "prebate" to ensure no American pays federal taxes on spending up to the poverty level, dollar-for-dollar federal revenue replacement and, through companion legislation, repeal of the 16th Amendment.

[However, that will mean that any taxable purchases made nationwide - whether those purchases be made by the rich or the poor- will be taxed at the same rate, in spite of any income differences. Currently, our federal income taxes are based on complex formulas to accommodate for various income levels, filing statuses, claimed dependents and other various exemptions because we are getting taxed for earning income and we are getting taxed for spending it, allowing us potential federal income tax refunds. As for repealing the 16th Amendment ("Amendment XVI-The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census or enumeration.") - that would be aggresively challenged because that act would be trying to eliminate an already established constitutional power of Congress.]

Answer 4

The Fair Tax is NOT a sales tax... It will replace the already embedded tax of 22% you now pay on all goods..... So this is NOT an increase on sales tax .. all those people you claim will be taxed already pay the embedded tax because its added to all goods prior to being shelved so guess what...... you pay it already and so does everyone else whether you buy a pack of gum or a house the embedded tax is there..... So NO there is NO added tax burden... may want to research the Fair Tax because your assumptions are way off base...

Answer 5

10% flat tax is fairer then the fair tax, with 0 loopholes for all

Answer 6

"Fair Tax" is exactly what it says....FAIR.