FACTOID # 22: South Dakota has the highest employment ratio in America, but the lowest median earnings of full-time male employees.

 Home Encyclopedia Statistics States A-Z Flags Maps FAQ About

 WHAT'S NEW RELATED ARTICLES People who viewed "FairTax" also viewed:

SEARCH ALL

Search encyclopedia, statistics and forums:

(* = Graphable)

Encyclopedia > FairTax
Throughout this article, the unqualified term "dollar" and the \$ symbol refer to the United States dollar.
The FairTax Book, co-authored by Neal Boortz and John Linder, was published on August 2, 2005, as a tool to increase public support for the FairTax Plan.

Taxation in the United States

Politics and government of
the United States
Taxation in the United States is a complex system which may involve payment to at least four different levels of government. ... Image File history File links US-GreatSeal-Obverse. ... Federal courts Supreme Court Circuit Courts of Appeal District Courts Elections Presidential elections Midterm elections Political Parties Democratic Republican Third parties State & Local government Governors Legislatures (List) State Courts Local Government Other countries Atlas  US Government Portal      Politics of the United States takes place in a framework of a presidential...

Federal taxation
History
Internal Revenue Service
Court  ·   Forms  ·   Code
Income tax  ·   Payroll tax
Alternative Minimum Tax
Estate tax  ·   Excise tax
Capital gains tax
State & local taxation
State income tax
Sales tax  ·   Use tax
Property tax
State tax levels
Federal tax reform
FairTax  ·   Flat tax
Tax protester arguments
Constitutional
Statutory  ·   Conspiracy

Part of the Taxation series
view  talk  edit  project

The FairTax plan was created by Americans For Fair Taxation, an advocacy group formed for tax reform. The group developed the plan and the name "Fair Tax" with economists based on interviews, polls, and focus groups of the general public.[14][3] Since the term "fair" is subjective, the name of the plan has been considered an oxymoron by some and deceptive by others. Georgia Republican John Linder first introduced the FairTax bill (H.R.2525) in July 1999 to the 106th United States Congress. He has reintroduced substantially the same bill in each subsequent session of Congress. While the bill attracted a total of 56 House and Senate cosponsors in the 108th Congress (H.R.25/S.1493),[15][16] 61 in the 109th Congress (H.R.25/S.25),[17][18] and 72 in the 110th United States Congress (H.R.25/S.1025),[19][20] it has not been voted on by either committee in the House or Senate. To become law, the bill will need to be included in a final version of tax legislation from the U.S. House Committee on Ways and Means, then obtain support from the Joint Committee on Taxation, pass both the House and the Senate, and finally be signed by the President. Americans For Fair Taxation (AFFT) is the nations largest, single-issue grassroots organization dedicated to fundamental tax code replacement. ... An advocacy group, interest group or lobbying group is a group, however loosely or tightly organized, doing advocacy: those determined to encourage or prevent changes in public policy without trying to be elected. ... GOP redirects here. ... John Elmer Linder (born September 9, 1942), American politician, has been a Republican member of the United States House of Representatives since 1993, representing the 7th District of Georgia (map). ... // Two sessions, roughly paralleling the calendar years 1999 and 2000: First Session: January 6, 1999 â€“ November 22, 1999 Second Session: January 24, 2000 â€“ December 15, 2000 January 7, 1999 â€“ February 12, 1999: Impeachment trial of President Bill Clinton March 29, 1999 â€“ Dow Jones Industrial Average ended above 10,000 for... -1... The 109th United States Congress meets from January 4, 2005, to January 1, 2007. ... The One Hundred Tenth United States Congress is the current meeting of the legislative branch of the United States federal government, composed of the Senate and the House of Representatives. ... The Committee on Ways and Means is a committee of the United States House of Representatives. ... The Joint Committee on Taxation is a Committee of the U.S. Congress established under the Internal Revenue Code. ... Federal courts Supreme Court Circuit Courts of Appeal District Courts Elections Presidential elections Midterm elections Political Parties Democratic Republican Third parties State & Local government Governors Legislatures (List) State Courts Local Government Other countries Atlas  US Government Portal      For other uses, see President of the United States (disambiguation). ...

## Tax rate

The sales tax rate, as defined in the legislation, is 23% of the total register price, which is comparable to a 30% traditional state sales tax.[3] The effective tax rate for any household would be variable due to the fixed monthly tax rebates that are used to "untax" purchases up to the poverty level.[2] The tax would be levied on all U.S. retail sales for personal consumption on new goods and services. Critics argue that the sales tax rate defined in the legislation may not be revenue neutral (that is, it would collect less for the government than the current tax regime), and thus would not yield enough money for the government.[3] The effective tax rate is the amount of income tax an individual or firm pays divided by the individual or firms total taxable income. ... In the United States, taxpayers will get a tax refund, a refund on their U.S. income tax, if the tax they owe is less than the sum of: The total amount of refundable tax credits that they claim. ... A good in economics is any physical object (natural or man-made) or service that, upon consumption, increases utility, and therefore can be sold at a price in a market. ... This article is about a term used in economics. ...

### Sales tax rate

The FairTax legislation would apply a 23% federal retail sales tax on the total transaction value of a purchase; in other words, consumers pay to the government 23 cents of every dollar spent (sometimes called tax-inclusive—as income taxes are calculated). The assessed tax rate is 30% if the FairTax is added to the pre-tax price of a good like traditional U.S. state sales taxes (sometimes called tax-exclusive).[3] The FairTax legislation uses total transaction value (tax-inclusive) in presenting the rate; with an item purchased for \$100, the retailer receives \$77 and the remaining is collected for the federal government. However, American sales taxes have historically been expressed as a percentage of the original sale price (tax-exclusive); items priced at \$100 pre-tax cost \$130 with the tax added.[25] The use of the tax-inclusive number in presenting the rate has been criticized as deceptive by the plan's opponents. Proponents argue that the 23% number represents a better comparison to income tax rates, which are presented as inclusive rates (see below, Presentation of tax rate).[5] Critics also argue that the sales tax rate would need to be higher to be revenue neutral (see below, Revenue neutrality).[7] Retail redirects here. ... For a type of taxation system in the United Kingdom and elsewhere, see Rates (tax). ... Tax rates around the world Tax revenue as % of GDP Part of the Taxation series        A sales tax is a tax on consumption and is normally a certain percentage that is added onto the price of goods or services that are purchased. ... For a type of taxation system in the United Kingdom and elsewhere, see Rates (tax). ... Throughout this article, the unqualified term dollar and the \$ symbol refer to the United States dollar. ... Throughout this article, the unqualified term dollar and the \$ symbol refer to the United States dollar. ...

The tax would be levied on all U.S. retail sales for personal consumption on new goods and services. A good would be considered "used" and not taxable if a consumer already owns it before the FairTax takes effect or if the FairTax has been paid previously on the good,[14] which may be different than the item being sold previously. Exports and the purchase of intermediate business sales would not be taxed, nor would savings, investments, or education tuition expenses as they would be considered an investment (rather than final consumption).[1] Personal services such as health care, legal services, financial services, haircuts, and auto repairs would be subject to the FairTax, as would renting apartments and other real property.[3] In comparison, the current tax system also taxes such consumption indirectly by taxing the income used for purchase. State sales taxes generally exempt these services in an effort to reduce the tax burden on low-income families. The FairTax would use a monthly rebate system instead of the common state exclusions. The FairTax would apply to Internet purchases and would tax retail international purchases (such as a boat or car) that are imported to the United States (collected by the U.S. Customs Service).[1] In common usage, saving generally means putting money aside, for example, by putting money in the bank or investing in a pension plan. ... Investment is a term with several closely related meanings in finance and economics. ... Tuition means instruction, teaching or a fee charged for educational instruction especially at a formal institution of learning. ... A physician visiting the sick in a hospital. ... Financial services is a term used to refer to the services provided by the finance industry. ... This article does not cite any references or sources. ... Federal courts Supreme Court Circuit Courts of Appeal District Courts Elections Presidential elections Midterm elections Political Parties Democratic Republican Third parties State & Local government Governors Legislatures (List) State Courts Local Government Other countries Atlas  US Government Portal      A U.S. state is any one of the fifty subnational entities of... The United States Customs Service (now part of U.S. Customs and Border Protection or CBP) was the portion of the US Federal Government dedicated to keeping illegal products outside of US borders. ...

### Effective tax rate

For more details on this topic, see Distribution of the FairTax burden.

The effective tax rate for any household would be variable due to the fixed monthly tax rebates. The rebates would have the greatest impact at low spending levels, where they could lower a household's effective rate to zero or a negative rate. At higher spending levels, the rebate has less impact, and a household's effective tax rate would approach 23% of total spending.[26] For example, a household of three spending \$30,000 a year on taxable items would devote about 6% of total spending to the FairTax after the rebate. A household spending \$125,000 on taxable items would spend around 19% on the FairTax.[3] The lowest effective tax rate under the FairTax could be negative due to the rebate. This could occur when a household spends less and pays less in taxes than the average poverty level spending for a similar household size. The household's rebate would exceed actual taxes paid by that household. Buying or otherwise receiving used items can also contribute towards a lower rate. The total amount of spending and the proportion of spending allocated to taxable items would determine a household's effective tax rate.[13] The FairTax (H.R.25/S.1025) is a proposal in the United States Congress for changing tax laws to replace the Internal Revenue Service (IRS) and all federal income taxes (including AMT), payroll taxes (including Social Security and Medicare taxes), corporate taxes, capital gains taxes, gift taxes, and estate... The effective tax rate is the amount of income tax an individual or firm pays divided by the individual or firms total taxable income. ... Percent below each countrys official poverty line, according to the CIA factbook. ...

To determine the effective tax rate on consumption:
• Let t be the statutory tax rate. For a 23% rate, then t = 0.23
• Let i be the annual income spent on new goods and services.
• Let r be the annual rebate.
$frac{t times i - r}{i}$

### Monthly tax rebate

2007 FairTax prebate schedule based on poverty level spending according to the poverty guidelines.

### Presentation of tax rate

Sales and income taxes behave differently due to differing definitions of tax base, which can make comparisons between the two confusing. For direct rate comparisons between sales and income taxes, one rate must be manipulated to look like the other. A 30% sales tax rate approximates a 23% income tax rate after adjustment. The current U.S. tax system imposes taxes primarily on income. The tax base is a household's pre-tax income. The appropriate income tax rate is applied to the tax base to calculate taxes owed. Under this formula, taxes to be paid are included in the base on which the tax rate is imposed (known as tax-inclusive). If an individual's gross income is \$100 and income tax rate is 23%, taxes owed equals \$23. The tax base of \$100 can be treated as two parts—\$77 of after-tax spending money and \$23 of income taxes owed. The income tax is taken "off the top", so the individual is left with \$77 in after-tax money.[14] Traditional state sales tax laws impose taxes on a tax base equal to the pre-tax portion of a good's price (known as tax-exclusive). Unlike income taxes, U.S. sales taxes do not include actual taxes owed as part of the base. A good priced at \$77 with a 30% sales tax rate yields \$23 in taxes owed. Since the sales tax is added "on the top", the individual pays \$23 of tax on \$77 of pre-tax goods.[14] By including taxes owed in the tax base, a sales tax rate can be directly compared to an income tax rate.

The FairTax statutory rate, unlike most U.S. state-level sales taxes, is calculated on a tax base that includes the amount of FairTax paid. In this manner, the FairTax, like European sales taxes, more closely resembles an income tax calculation. A final price of \$100 includes \$23 of taxes. Like the income tax example above, the taxes to be paid would be included in the base on which the FairTax is imposed. Neal Boortz has stated that the FairTax would be implemented as an inclusive tax, which would include the tax in the retail price (not added on at checkout) and display the tax on the receipt as 23% of the total.[28][23] The FairTax is presented as a 23% tax rate for easy comparison to income tax rates (the taxes it would be replacing). Proponents believe it is both inaccurate and misleading to say that an income tax is 23% and the FairTax is 30% as it implies that the sales tax burden is higher, when in fact the burden of the two taxes is precisely the same—either both taxes are 23% or both taxes are 30%. The plan's opponents call the semantics deceptive—Laurence Vance, writing for the Ludwig von Mises Institute, goes so far as to call the rate presentation a "lie".[25] Bruce Bartlett, writing in the Wall Street Journal, also called the presentation confusing and deceptive based on the conventional method of calculating sales taxes.[29] In a tax system and in economics, the tax rate describes the burden ratio (usually expressed as a percentage) at which a business or person is taxed. ... Tax rates around the world Tax revenue as % of GDP Part of the Taxation series        A sales tax is a tax on consumption and is normally a certain percentage that is added onto the price of goods or services that are purchased. ... Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank   Money supply Fiscal policy Spending   Deficit   Debt Trade policy Tariff   Trade agreement Finance Financial market Financial market participants Corporate   Personal Public   Banking   Regulation        Value added tax (VAT), or goods and services tax (GST), is... Ludwig von Mises Institute for Austrian Economics, Auburn, Alabama The Ludwig von Mises Institute (LvMI), based in Auburn, Alabama, is a libertarian academic organisation engaged in research and scholarship in the fields of economics, philosophy and political economy. ... Bruce Bartlett (b. ... The Wall Street Journal is an influential international daily newspaper published in New York City, New York with an average daily circulation of 1,800,607 (2002). ...

Comparison to a typical sales rate:
• Let t be the FairTax rate. For a 23% rate, then t = 0.23
• Let a be the rate in terms of a typical sales tax.
• Let p be the price of the good (including the tax).
The revenue that would go to the government:
$t times p$
The revenue remaining for the seller of the good:
$p - t times p$
To convert the tax, divide the money going to the government by the money the company nets:
$a = frac{t times p}{p - t times p} = frac{t}{1 - t}$
Therefore, to adjust any rate below to that of a traditional sales tax, divide the given rate by 1 minus that rate.

### Revenue neutrality

Main article: Revenue neutrality of the FairTax

One of the leading economists supporting the FairTax is Dr. Laurence Kotlikoff of Boston University. A detailed 2006 study published in Tax Notes by Beacon Hill Institute at Suffolk University and Dr. Kotlikoff concluded the FairTax would be revenue-neutral for the tax year 2007 at a rate of 23.82% (31.27% tax-exclusive) assuming full taxpayer compliance.[31] The study states that if state and local governments continue to collect the same real revenues from their taxpayers, they will be able to maintain their real spending levels, despite the requirement that they pay the FairTax on their purchases.[31] The Argus Group and Arduin, Laffer & Moore Econometrics each published an analysis that defended the 23% rate.[32][33][34] While proponents of the FairTax concede that the above studies did not explicitly account for tax evasion, they also claim that the studies did not altogether ignore tax evasion under the FairTax. These studies implicitly incorporated some degree of tax evasion in their calculations simply by using National Income and Product Account based figures that presumably understate total household consumption.[31] Moreover, these studies did not account for the expected capital gains that would result from a reduction in the real nominal value of U.S. government debt and the increased economic growth that economists believe would occur.[10][31] Laurence J. Kotlikoff (January 30, 1951-) is a american professor of economics at Boston University who believes that the USA is going toward an economic catastrophe in the near future. ... Tax Analysts logo Tax Analysts is a nonprofit publisher that provides international in-depth tax information. ... Founded in 1991, the Beacon Hill Institute (BHI) is the research arm of the Department of Economics at Suffolk University in Boston. ... Arduin, Laffer & Moore Econometrics (ALME) is an economic consulting firm that pools the talents of Donna Arduin, Dr. Arthur Laffer, and Stephen Moore. ... This article contrasts tax evasion, tax avoidance, tax resistance and tax mitigation. ... National Income and Product Accounts (NIPA) use double entry accounting to report the monetary value and sources of output produced in a country and the distribution of incomes that production generates. ... The U.S. public debt is the amount of money that the United States federal government (not the states or banks or corporations or individuals) owes. ... World GDP/capita changed very little for most of human history before the industrial revolution. ...

In contrast to the above studies, one of the leading economists opposing the FairTax, William Gale of the Brookings Institution, published a detailed 2005 study in Tax Notes that estimated a rate of 28.2% (39.3% tax-exclusive) for 2007 assuming full taxpayer compliance and an average rate of 31% (44% tax-exclusive) from 2006–2015 (an increase that accounts for the replacement of an additional \$3 trillion in revenue collected through the Alternative Minimum Tax (AMT) impacting the middle class over the 10 year period).[3][35][36] The study also concluded that if the tax base were eroded by 10% due to tax evasion, tax avoidance, and/or legislative adjustments, the average rate would be 34% (53% tax-exclusive) for the 10 year period. The study did not take into consideration the increase in economic activity that Gale expects would result from the imposition of the FairTax. The President's Advisory Panel for Federal Tax Reform performed an analysis to replace the personal income tax (excluding other taxes) with a retail sales tax and found the rate to be 25% (34% tax-exclusive) for 2006 assuming at least 10% evasion.[7] The rate would need to be substantially higher to replace the additional taxes replaced by the FairTax (payroll, corporate, capital gains, estate, and gift taxes). The Treasury Department has refused to release for peer review the detailed figures and methodology used in the tax panel analysis.[27] FairTax proponents, including the Beacon Hill Institute and Dr. Kotlikoff, have criticized the President's Advisory Panel's study as having altered the terms of the FairTax and using unsound methodology.[31][27] William G. Gale is vice president and director of the Economic Studies Program at the Brookings Institution and the Arjay and Frances Miller Chair in Federal Economic Policy. ... The Brookings Institution is a United States nonprofit public policy think tank based in Washington, D.C.. Described in 1977, by TIME magazine as as the nations pre-eminent liberal think tank,[1] the institution is devoted to public service through research and education in the social sciences, particularly...        Alternative Minimum Tax (AMT) is a tax system that is part of the federal income tax system in the United States. ... A monument to the working and supporting classes along Market Street in the heart of San Franciscos Financial District, home to tens-of-thousands of professional and managerial middle class workers each day. ... On January 7, 2005, President George W. Bush announced the establishment of the Presidents Advisory Panel for Tax Reform, a bipartisan panel to advise on options to reform the United States income tax code to make it simpler, fairer, and more pro-growth to benefit all Americans. ... Tax rates around the world Tax revenue as % of GDP Part of the Taxation series        The federal government of the United States imposes a progressive tax on the taxable income of individuals, corporations, trusts, decedents estates, and certain bankruptcy estates. ... The U.S. Treasury building today. ... Peer review (known as refereeing in some academic fields) is a scholarly process used in the publication of manuscripts and in the awarding of funding for research. ...

## Distribution of tax burden

Boston University study of the FairTax. Lower rates claimed from a larger tax base, replacing regressive taxes, and wealth taxation.
President's Advisory Panel's analysis of a hybrid National Sales Tax. Higher rates claimed on the middle-class for a personal income tax replacement.

Households at the lower end of the income scale spend almost all their income, while households at the higher end are more likely to devote a portion of income to saving; households at the extreme high end of consumption often finance their purchases out of savings, not income.[6] These savings would be taxed when they become purchases. Income earned and saved would not be taxed immediately under the proposal. In other words, savings would be spent at some point in the future and taxed according to that consumption. FairTax advocates state that this would improve taxing of wealth. Economist Laurence Kotlikoff of Boston University states that the FairTax could make the tax system much more progressive and generationally equitable.[2] "Their view that taxing sales is regressive is just plain wrong. Taxing consumption is effectively the same as taxing wages plus taxing wealth."[2] Kotlikoff finds that the FairTax significantly reduces marginal taxes on work and saving, which substantially lowers overall average remaining lifetime tax burdens on current and future workers at all income levels.[9] The Beacon Hill Institute at Suffolk University concluded in a 2007 study on distributional effects that "replacing income and payroll taxes with the FairTax would make the United States federal tax system more progressive than it is now and would benefit the average individual in almost all expenditures deciles."[38] Laurence J. Kotlikoff (January 30, 1951-) is a american professor of economics at Boston University who believes that the USA is going toward an economic catastrophe in the near future. ... Founded in 1991, the Beacon Hill Institute (BHI) is the research arm of the Department of Economics at Suffolk University in Boston. ...

## Predicted effects

Many mainstream economists and tax experts believe consumption taxes, such as the FairTax, would have a positive impact on economic growth, incentives for international business to locate in the U.S., and increased U.S. international competitiveness (border tax adjustment in global trade).[3][5][10] The FairTax is expected to increase cost transparency for funding the federal government and supporters believe it would have advantages with taxing illegal activity and illegal immigrants.[5] The FairTax would be tax-free on mortgage interest (up to the basic interest rate as determined by the Federal Reserve) and donations; however, some law makers have concerns about losing social incentives on home ownership and charitable contributions. There is also concern about the impact to the income tax industry and the difficulty with the aggressive repeal of the Sixteenth Amendment, which would prevent Congress from introducing new income tax legislation in the future.[13] The FairTax Book, co-authored by Neal Boortz and John Linder, was published on August 2, 2005, as a tool to increase public support for the FairTax Plan. ... A consumption tax is a tax on the purchase of a good or service. ... World GDP/capita changed very little for most of human history before the industrial revolution. ... International trade is the exchange of goods and services across international boundaries or territories. ... Social engineering is a concept in political science that refers to efforts to systematically manage popular attitudes and social behavior on a large scale, whether by governments or private groups. ... An owner-occupier is a person who lives in a house that he or she owns. ... Amendment XVI in the National Archives Amendment XVI (the Sixteenth Amendment) of the United States Constitution was ratified on February 3, 1913. ...

### Economic

For more details on this topic, see Predicted effects of the FairTax: Economic effects
U.S. Rep John Linder holding the 132 page Fair Tax Act in contrast to the more than 60,000 pages of tax code laws and regulations currently in effect.

The FairTax proposal would have effects in many areas that influence the United States. FairTax proponents assert that the proposal would provide tax burden visibility and reduce compliance costs. The cost of federal government would be highly visible as consumers would see most of this cost in a single tax paid every time they purchase a good or service.[2] Under the current tax system, the federal government collects revenue through a wide variety of taxes on individuals and businesses, which may not be fully visible to individual citizens.[42] The efficiency cost of the current tax system—the output that is lost over and above the tax itself—is between \$240 billion and \$600 billion every year according to a 2005 report from the U.S. Government Accountability Office.[43][44] Supporters argue that the FairTax system would reduce these compliance and efficiency costs by 90% and return a larger share of that money to the productive economy.[2][45] In addition, an estimated \$11 trillion is held in foreign accounts (largely for tax purposes), which former Federal Reserve Chairman Alan Greenspan predicts would be repatriated back to U.S. banks if the FairTax were enacted, becoming available to U.S. capital markets, bringing down interest rates, and otherwise promoting economic growth in the United States.[5][46] The FairTax Book, co-authored by Neal Boortz and John Linder, was published on August 2, 2005, as a tool to increase public support for the FairTax Plan. ... Image File history File linksMetadata TaxCode. ... Image File history File linksMetadata TaxCode. ... John Elmer Linder (born September 9, 1942), American politician, has been a Republican member of the United States House of Representatives since 1993, representing the 7th District of Georgia (map). ... The Internal Revenue Code (or IRC) (more formally, the Internal Revenue Code of 1986, as amended) is the main body of domestic statutory tax law of the United States organized topically, including laws covering the income tax (see Income tax in the United States), payroll taxes, gift taxes, estate taxes... General Accounting Office headquarters, Washington, D.C. The Government Accountability Office (GAO) is the non-partisan audit, evaluation, and investigative arm of Congress, and an agency in the Legislative Branch of the United States Government. ... The Federal Reserve System is headquartered in the Eccles Building on Constitution Avenue in Washington, DC. The Federal Reserve System (also the Federal Reserve; informally The Fed) is the central banking system of the United States. ... Squalltoonix (born March 6, 1926 in New York City) is an American economist and was Chairman of the Board of Governors of the Federal Reserve of the United States from 1987 to 2006. ... The capital market is the market for securities, where companies and the government can raise long-term funds. ...

Eighty economists, including Nobel Laureate Vernon L. Smith, wrote an open letter to the President, the Congress, and the American people, stating that the FairTax would boost the United States economy.[10] According to the National Bureau of Economic Research and Americans For Fair Taxation, GDP would increase almost 10.5% in the year after the FairTax goes into effect.[45] In addition, the incentive to work would increase by as much as 20%, the economy’s capital stock would increase by 42%, labor supply by 4%, output by 12%, and real wage rate by 8%.[47] A study in 2007 by the Beacon Hill Institute of Suffolk University stated that within five years real GDP would increase 10.7% over the current system, domestic investment by 86.3%, capital stock by 9.3%, employment by 9.9%, real wages by 10.2%, and consumption by 1.8%.[48] Further, studies of the FairTax at Boston University and Rice University suggest the FairTax will bring long-term interest rates down by as much as one third.[47][49] As falling tax compliance costs lower production costs, exports would increase by 26% initially and remain more than 13% above present levels.[45] According to Professor Dale Jorgenson of Harvard University’s Economics Department, revenues to Social Security and Medicare would double as the size of the economy doubles within 15 years after passage of the FairTax.[50] Opponents offer a study commissioned by the National Retail Federation in 2000 that found a national sales tax would bring a 3 year decline in the economy, a 4 year decline in employment and an 8 year decline in consumer spending.[51] The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, commonly called the Nobel Prize in Economics, is a prize awarded each year for outstanding intellectual contributions in the field of economics. ... To meet Wikipedias quality standards, this article or section may require cleanup. ... The National Bureau of Economic Research (NBER) is a private, nonprofit, nonpartisan research organization dedicated to studying the science and empirics of economics, especially the American economy. ... Americans For Fair Taxation (AFFT) is the nations largest, single-issue grassroots organization dedicated to fundamental tax code replacement. ... the economys total quantity of capital goods is called the capital stock This page is a candidate for speedy deletion. ... Welfare economics is a branch of economics that uses microeconomic techniques to simultaneously determine the allocational efficiency of a macroeconomy and the income distribution consequences associated with it. ... The term real wages refer to wages that have been adjusted for inflation. ... Founded in 1991, the Beacon Hill Institute (BHI) is the research arm of the Department of Economics at Suffolk University in Boston. ... President Johnson signing the Medicare amendment. ... The National Retail Federation is the worlds largest retail trade association, with membership that comprises all retail formats and channels of distribution including department, specialty, discount, catalog, Internet, independent stores, chain restaurants and grocery stores as well as the industrys key trading partners of retail goods and services. ...

Global corporations consider local tax structures when making planning and capital investment decisions. Lower corporate tax rates and favorable transfer pricing regulations can induce higher corporate investment in a given locality. The United States currently has the highest combined statutory corporate income tax rate among OECD countries.[52] Bill Archer, former head of the House Ways and Means Committee, asked Princeton University Econometrics to survey 500 European and Asian companies regarding the impact on their business decisions if the United States enacted the FairTax. 400 of those companies stated they would build their next plant in the United States, and 100 companies said they would move their corporate headquarters to the United States.[14][53] In addition, the U.S. is currently the only one of the 30 OECD countries with no border adjustment element in its tax system.[54] Proponents state that because the FairTax is automatically border adjustable, the 17% competitive advantage, on average, of foreign producers would be eliminated, immediately boosting U.S. competitiveness overseas and at home.[13] The Organization for Economic Co-operation and Development (OECD) is an international organization of those developed countries that accept the principles of representative democracy and a free market economy. ... There are a number of people named Bill Archer: Bill Archer, a politician in the United States Bill Archer, a politician in Manitoba, Canada This is a disambiguation page &#8212; a navigational aid which lists other pages that might otherwise share the same title. ... The Committee on Ways and Means is a committee of the United States House of Representatives. ... Princeton University is a private coeducational research university located in Princeton, New Jersey. ...

### Transition

For more details on this topic, see Predicted effects of the FairTax: Transition effects
Stability of the Tax Base: A comparison of Personal Consumption Expenditures and Adjusted Gross Income.

Individuals under the current system who accumulated savings from ordinary income (by choosing not to spend their money when the income was earned) paid taxes on that income before it was placed in savings. When individuals spend above the poverty level with money saved under the current system, that spending would be subject to the FairTax. People living through the transition may find both their earnings and their spending taxed. Supporters of the plan argue that the current system is no different, since compliance costs and "hidden taxes" embedded in the prices of goods and services cause savings to be "taxed" a second time already when spent. The rebates would supplement accrued savings, covering taxes up to the poverty level.[14] The income taxes on capital gains, social security and pension benefits would be eliminated under FairTax. The FairTax would also eliminate what some claim to be the double taxation on savings that is part of estate taxes. In addition, the FairTax legislation adjusts Social Security benefits for changes in the price level, so a percentage increase in prices would result in an equal percentage increase to Social Security income.[1] Supporters suggest these changes would offset paying the FairTax under transition conditions.[5] This article is about Estate tax in the United States. ...

During the transition, many or most of the employees of the IRS (105,978 in 2005)[57] would face loss of employment.[31] The Beacon Hill Institute estimate is that the federal government would be able to cut \$8 billion from the IRS budget of \$11.01 billion (in 2007), reducing the size of federal tax administration by 73%.[31] In addition, income tax preparers (many seasonal), tax lawyers, tax compliance staff in medium-to-large businesses, and software companies which sell tax preparation software (such as Drake Software, TaxCut, and TurboTax), could face significant drops, changes, or loss of employment.[13] However, IRS testimony from 2004 stated that 45% of revenue agents and officers would become eligible for retirement in the following 5 years and there is concern about the loss of their work force as their hiring efforts struggle to keep pace with attrition.[58] In addition, the IRS would not go completely out of commission until 3 years after the FairTax was enacted, providing employees time to find other employment.[1] Proponents claim the projected 10.5% growth in the economy during the first year of the FairTax would provide plenty of new jobs to these workers that are typically well educated and well equipped with transferable skills.[13] In the period before the FairTax was implemented, there could be a strong incentive for individuals to buy goods without the sales tax using credit. After the FairTax was in effect, the credit could be paid off using untaxed payroll. If credit incentives do not change, opponents of the FairTax worry it could exacerbate an existing consumer debt problem.[59] Proponents of the FairTax state that this effect could also allow individuals to pay off their existing (pre-FairTax) debt more quickly,[5] and studies suggest lower interest rates after FairTax passage.[47][49]

### Other indirect effects

For more details on this topic, see Predicted effects of the FairTax: Other indirect effects

## Changes in the retail economy

See also: Tax: Economics of taxation, Effect of taxes and subsidies on price

Since the FairTax would not tax used goods, the value would be determined by the supply and demand in relation to new goods.[64] The price differential/margins between used and new goods would stay consistent, as the cost and value of used goods are in direct relationship to the cost and value of the new goods. Because the U.S. tax system has a hidden effect on prices, it is expected that moving to the FairTax would decrease production costs from the removal of business taxes and compliance costs, which is predicted to offset a portion of the FairTax effect on prices.[5] â€œTaxesâ€ redirects here. ... Taxes and subsidies have the effect of shifting the quantity and price of goods. ... The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ... Taxes and subsidies have the effect of shifting the quantity and price of goods. ...

### Value of used goods

Since the FairTax would not tax used goods, there is a common misunderstanding that this would create a differential, equal to the FairTax, between the price of new and used goods. Such a differential would certainly impact the sale of new goods like vehicles and homes. However, like the income tax system that contains embedded tax cost (see Theories of retail pricing),[4] used goods would contain the embedded FairTax cost. While the FairTax would not be applied to the retail sales of used goods, the inherent value of a used good includes the taxes paid when the good was sold at retail. The value is determined by the supply and demand in relation to new goods.[64] The price differential / margins between used and new goods would stay consistent, as the cost and value of used goods are in direct relationship to the cost and value of the new goods. Throughout this article, the unqualified term dollar and the \$ symbol refer to the United States dollar. ...

### Theories of retail pricing

Standard supply and demand diagram illustrating taxes effect on prices.

Retail prices are inflated due to embedded taxes and compliance costs passed to the consumer by producers and suppliers.[4] John Linder states the FairTax would eliminate almost all federal taxation costs from the supply chain, which could lower production costs by up to 30%.[45] Americans For Fair Taxation has claimed that the production cost of domestic goods and services could decrease by approximately 22% on average after embedded taxes and compliance costs were removed, leaving the sale nearly the same after taxes.[13] This is based on a study conducted by Dr. Dale Jorgenson, who found that producer prices would drop between 15% and 26% (depending on the type of good/service) after the switch to a consumption based tax.[5] However, Jorgenson's research included all income and payroll taxes regardless of whether they were paid by employees or employers in the 22% embedded tax estimation. (It is also important to note that the Jorgenson model did not capture any reduction in the cost of compliance associated with changing from a complex income tax system to a simpler consumption tax.) This means that Jorgenson assumed that businesses would pass on all the cost savings from the repeal of payroll taxes and income tax withholding to consumers in the form of lower prices. Mathematically, this would have to result in employee take-home pay (net income) remaining unchanged from pre-FairTax levels.[3][65] A diagram showing the effect of a per unit tax on the standard supply and demand diagram. ... A diagram showing the effect of a per unit tax on the standard supply and demand diagram. ... The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ... Taxes and subsidies have the effect of shifting the quantity and price of goods. ... A supply chain, logistics network, or supply network is a coordinated system of organizations, people, activities, information and resources involved in moving a product or service in physical or virtual manner from supplier to customer. ... In economics, the cost-of-production theory of value is the theory that the price of an object is determined by the sum of the cost of the resources that went into making it. ... Dale W. Jorgenson is the Samuel W. Morris University Professor at Harvard University (BA, economics Reed College in Portland, Oregon, in 1955 and a PhD in economics from Harvard in 1959). ... Net income is equal to the income that a firm has after subtracting costs and expenses from the total revenue. ...

If businesses instead provided employees with their gross pay as expected (including income tax withholding and the employee share of payroll taxes),[31] Arduin, Laffer & Moore Econometrics estimated production costs would decrease by a minimum of 11.55%.[34] This decrease would offset a portion of the FairTax amount reflected in retail prices. These embedded costs include corporate taxes, compliance costs, and the employer share of payroll taxes (see Effect on tax compliance costs). The Beacon Hill Institute shows that it would not matter whether prices fall or rise—the relative tax burden remains the same because if prices increased with the addition of the FairTax, wages would also rise accordingly; or if the federal reserve did not decide to accommodate (does not increase the money supply), then prices would fall and wages would remain at their net rates. Purchasing power for buying consumer goods and services in either situation would remain essentially the same, and the FairTax rate would be the same.[31] Gross income is commonly defined as the amount of a companys or a persons income before all deductions or any taxpayerâ€™s income, except that which is specifically excluded by the Internal Revenue Code, before taking deductions or taxes into account. ... Throughout this article, the unqualified term dollar and the \$ symbol refer to the United States dollar. ... In macroeconomics, money supply (monetary aggregates, money stock) is the quantity of currency and money in bank accounts in the hands of the non-bank public available within the economy to purchase goods, services, and securities. ...

## Effects on tax code compliance

FairTax supporters state that black market or illegal economic activity is largely untaxed under the current tax system. Economists estimate the underground economy in the United States to be between one and three trillion dollars annually.[46][67][68] By imposing a sales tax, black market activity would be significantly taxed when proceeds from such activity are spent on legal consumption. For example, the sale of illegal narcotics would remain untaxed (instead of being guilty of income tax evasion, dealers would be guilty of failing to submit sales tax), but drug dealers would face taxation when they used drug proceeds to buy consumer goods such as food, clothing, and cars. By taxing this previously untaxed money, FairTax supporters state the black market would be paying part of their share of what would otherwise be uncollected income and payroll taxes.[5] It has been suggested that this article or section be merged into underground economy. ... This box:      The underground economy or shadow economy consists of all commerce that is not taxed. ...

Microeconomist Mike Moffatt argued that if there were no net change in retail prices or tax burdens, the licit consumption of goods and services by the underground economy would continue to bear the same tax burden as before. Legal purchases under the current tax regime carry the hidden cost of implicit taxes. When an explicit tax replaces those taxes, the consumption purchases would still bear the same tax burden.[69][unreliable source?] However, the cost paid by the underground economy through embedded taxes is the cost associated with those paying into the income tax base. If black market activity were taxed today, the tax burden on the rest of the population would decrease from the larger base. Likewise, the large base of consumption would have illegal activity paying into the FairTax base. Microeconomics is a branch of Economics that studies how individuals, households, and firms make decisions to allocate limited resources,[1] typically in markets where goods or services are being bought and sold. ... Mike Moffatt is a Canadian economist and economics writer. ...

### Tax compliance

"No, No! Not That Way"—Political cartoon from 1933 commenting on a general sales tax over an income tax.

The current income tax system fails to collect on a significant percentage of taxes. The IRS estimates twenty additional cents of taxes are owed on unreported income for every tax dollar collected. In 2001, the IRS estimated this shortfall to be over \$312 billion.[70] These figures do not include taxes lost on illicit sources of income, such as illegal drug dealing. Proponents assert that the transparency and simplicity of the FairTax would subject much of this unreported income to taxation. The number of tax collection points would significantly reduce under the FairTax, as only retailers would file a tax return compared to every income earner. The FairTax would reduce the number of tax filers by about 80% (from 145 million to 25 million) and reduce the filing complexity to a simplified state sales tax form.[71][45] Image File history File links Size of this preview: 542 Ã— 599 pixels Full resolution (750 Ã— 829 pixel, file size: 242 KB, MIME type: image/jpeg) Title: No, No! Not That Way Artist: Clifford Berryman Date: June 3, 1933 Location: Library of Congress, Prints and Photographs Division Source: Tax History Project... Image File history File links Size of this preview: 542 Ã— 599 pixels Full resolution (750 Ã— 829 pixel, file size: 242 KB, MIME type: image/jpeg) Title: No, No! Not That Way Artist: Clifford Berryman Date: June 3, 1933 Location: Library of Congress, Prints and Photographs Division Source: Tax History Project... This early political cartoon by Ben Franklin was originally written for the French and Indian War, but was later recycled during the Revolutionary War An editorial cartoon, also known as a political cartoon, is an illustration or comic strip containing a political or social message. ... A sales tax is a consumption tax charged at the point of purchase for certain goods and services. ... Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank   Money supply Fiscal policy Spending   Deficit   Debt Trade policy Tariff   Trade agreement Finance Financial market Financial market participants Corporate   Personal Public   Banking   Regulation        An income tax is a tax levied on the financial income...

FairTax opponents believe that compliance decreases when taxes are not automatically withheld from citizens. Compliance rates also fall when taxed entities, rather than a third party, self-report their tax liability. For example, ordinary personal income taxes can be automatically withheld and are reported to the government by a third party. Taxes without withholding and with self-reporting, such as the FairTax, can see higher evasion rates. In other countries, similar VAT taxes have an average evasion rate of 20%.[27] William Gale has estimated that erosion of the tax base by 10% due to evasion would require an average sales tax rate of 34% (53% tax-exclusive) from 2006–2015 (which also accounts for the additional \$3 trillion in revenue collected through the AMT impacting the middle class over the 10 year period) and evasion of 20% would have an average rate of 39% (65% tax-exclusive) for the 10 year period.[35] FairTax proponents, including the Beacon Hill Institute, disagree with those conclusions and published a study which challenges the findings.[32][27] In the United States income tax system, employers are required to withhold a portion of each employees income and pay it directly to the U.S. Internal Revenue Service. ... This article contrasts tax evasion, tax avoidance, tax resistance and tax mitigation. ... Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank   Money supply Fiscal policy Spending   Deficit   Debt Trade policy Tariff   Trade agreement Finance Financial market Financial market participants Corporate   Personal Public   Banking   Regulation        Value added tax (VAT), or goods and services tax (GST), is...        Alternative Minimum Tax (AMT) is a tax system that is part of the federal income tax system in the United States. ...

The FairTax is a national tax, but can be administered by the states rather than a federal agency.[1] This has a bearing on compliance, as the states' own agencies could monitor and audit businesses within that state. The 0.25% retained by the states amounts to \$5 billion the states would have available for enforcement and administration. For example, California should receive over \$500 million for enforcement and administration. According to the California 2004–05 budget analysis, this is more than the \$327 million California is spending on the state's sales and excise taxes.[72] The FairTax is simpler, but extends to cover services which are not currently subject to the California sales tax. Because the federal money paid to the states would be a percentage of the total revenue collected, John Linder claims the states would have an incentive to maximize collections.[5] Proponents believe that states that choose to conform to the federal tax base would have advantages in enforcement, information sharing, and clear interstate revenue allocation rules.[1][73] Economist Bruce Bartlett suggests that the State may not have sufficient incentive to enforce the tax and that sales taxes have long exempted all but a few services because of the enormous difficulty in taxing intangibles.[29] University of Michigan economist Joel Slemrod argues that states would face significant issues in enforcing the tax. "Even at an average rate of around 5 percent, state sales taxes are difficult to administer."[74]

### Underground economy

Opponents of the FairTax argue that imposing a national retail sales tax would drive transactions underground and create a vast underground economy.[3][75] Under a retail sales tax system, the purchase of intermediate goods would not always be taxed, since those goods would produce a retail good that will be taxed. Individuals and businesses may be able to manipulate the tax system by claiming that purchases are for intermediate goods, when in fact they are final purchases that should be taxed. Proponents point out that a business is required to have a registered seller's certificate on file, and must keep complete records of all transactions for six years. Businesses must also record all taxable goods bought for seven years. They are required to report these sales every month (see Personal vs. business purchases).[1] This box:      The underground economy or shadow economy consists of all commerce that is not taxed. ... Throughout this article, the unqualified term dollar and the \$ symbol refer to the United States dollar. ...

While many economists and tax experts support a consumption tax, problems could arise with using a retail sales tax rather than a value added tax (VAT).[3] A VAT imposes a tax at every intermediate step of production, so the goods reach the final consumer with much of the tax already in the price, along with some extra overhead. The retail seller has little incentive to conceal retail sales, since he has already paid much of the good's tax. Retailers are unlikely to subsidize the consumer's tax evasion by concealing sales. In contrast, a retailer has paid no tax on goods under a sales tax system. This provides an incentive for retailers to conceal sales and engage in "tax arbitrage" by sharing some of the illicit tax savings with the final consumer.[76] Tax rates around the world Tax revenue as % of GDP Economic policy Monetary policy Central bank   Money supply Fiscal policy Spending   Deficit   Debt Trade policy Tariff   Trade agreement Finance Financial market Financial market participants Corporate   Personal Public   Banking   Regulation        Value added tax (VAT), or goods and services tax (GST), is... In economics and finance, arbitrage is the practice of taking advantage of a price differential between two or more markets: a combination of matching deals are struck that capitalize upon the imbalance, the profit being the difference between the market prices. ...

In the United States, a general sales tax is imposed in 45 states plus the District of Columbia (accounting for over 97% of both population and economic output). Most states also collect a variety of local sales taxes including county, city, and transit taxes.[77] The United States has a large infrastructure for taxing sales that many countries do not have. Proponents respond to the underground economy argument by pointing out that, whereas tax evasion under the current income tax system requires only one person (the payer) to lie on their tax forms, tax evasion under the FairTax requires collusion of both the payer (the retail purchaser) and the payee (the retail seller). Furthermore, the number of individuals required to file taxes drops from approximately 145 million to 25 million, a drop in excess of 80%. This drop in the number of collection points will allow the tax administration to view tax fraud with greater scrutiny.[71] Proponents of the FairTax see a substantial amount of additional tax revenue from those engaging in the black market, as a sales tax would require all who consume to be taxed (see Effects on tax code compliance). Throughout this article, the unqualified term dollar and the \$ symbol refer to the United States dollar. ...

For an individual to purchase items tax-free for business purposes, the business would be required to be a registered seller with the state sales tax authority, and thereby be subject to audit. The state would issue the business a registered seller's certificate. This would enable the business to purchase tax free from wholesale vendors, but they must give a copy of their registration certificate to the vendor to leave an audit trail.[1] When an item is purchased for business use from a retail vendor, the business would have to pay the tax on the purchase and take a credit against the tax due on their sales tax return. Taxable property and services purchased by a qualified non-profit or religious organization 'for business purposes' would not be taxable.[78]

## FairTax movement

Grassroots supporters organize in Orlando, Florida for a FairTax Rally on July 28, 2006.

The origins of the FairTax began with a group of businessmen from Houston, Texas, who initially financed what has become the non-partisan political advocacy group Americans For Fair Taxation (AFFT), which has grown into a large grassroots tax reform movement.[11] This organization, founded in 1994, claims to have spent over \$20 million in research,[79] marketing, lobbying, and organizing efforts over a ten year period and is seeking to raise over \$100 million more to promote the plan. AFFT includes a staff in Houston and a large group of volunteers who are working to get the FairTax enacted.[14] Bruce Bartlett has charged that the FairTax was devised by the Church of Scientology in the early 1990s;[29] however, Representative John Linder told the Atlanta Journal-Constitution that Bartlett confused the FairTax movement with the Scientology-affiliated Citizens for an Alternative Tax System.[80] Leo Linbeck, AFFT Chairman and CEO, stated "As a founder of Americans For Fair Taxation, I can state categorically, however, that Scientology played no role in the founding, research or crafting of the legislation giving expression to the FairTax."[79] Image File history File links Download high resolution version (900x675, 268 KB) Summary Image taken at the Orlando FairTax Rally - Taken By Jonathon Rube with ORLANDO360 More images located at http://tax. ... Image File history File links Download high resolution version (900x675, 268 KB) Summary Image taken at the Orlando FairTax Rally - Taken By Jonathon Rube with ORLANDO360 More images located at http://tax. ... Nickname: Location in Orange County and the state of Florida Coordinates: , Country State Counties Orange Government  - Mayor Buddy Dyer (D) Area  - City 101 sq mi (261. ... is the 209th day of the year (210th in leap years) in the Gregorian calendar. ... Year 2006 (MMVI) was a common year starting on Sunday of the Gregorian calendar. ... An advocacy group, interest group or lobbying group is a group, however loosely or tightly organized, doing advocacy: those determined to encourage or prevent changes in public policy without trying to be elected. ... Americans For Fair Taxation (AFFT) is the nations largest, single-issue grassroots organization dedicated to fundamental tax code replacement. ... A grassroots political movement is one driven by the constituents of a community. ... Tax reform is the process of changing the way taxes are collected or managed by the government. ... Bruce Bartlett (b. ... Scientology cross Symbol The Church of Scientology is the largest religious organization devoted to the practice and the promotion of the Scientology belief system. ... The Atlanta Journal-Constitution is the only major daily newspaper of Atlanta and metro Atlanta. ... Citizens for an Alternative Tax System (CATS) is a national grassroots public interest group in the United States. ...

 FairTax Part of the U.S. Taxation series FairTax subarticles • Distribution of the burden • Predicted effects • Revenue neutrality • The FairTax Book • Americans For Fair Taxation Taxation in the United States is a complex system which may involve payment to at least four different levels of government. ... The FairTax (H.R.25/S.1025) is a proposal in the United States Congress for changing tax laws to replace the Internal Revenue Service (IRS) and all federal income taxes (including AMT), payroll taxes (including Social Security and Medicare taxes), corporate taxes, capital gains taxes, gift taxes, and estate... The FairTax Book, co-authored by Neal Boortz and John Linder, was published on August 2, 2005, as a tool to increase public support for the FairTax Plan. ... The FairTax (H.R.25/S.1025) is a proposal in the United States Congress for changing tax laws to replace the Internal Revenue Service (IRS) and all federal income taxes (including AMT), payroll taxes (including Social Security and Medicare taxes), corporate taxes, capital gains taxes, gift taxes, and estate... The FairTax Book, co-authored by Neal Boortz and John Linder, was published on August 2, 2005, as a tool to increase public support for the FairTax Plan. ... Americans For Fair Taxation (AFFT) is the nations largest, single-issue grassroots organization dedicated to fundamental tax code replacement. ... v • d • e

Alternative Minimum Tax (AMT) is a tax system that is part of the federal income tax system in the United States. ... A consumption tax is a tax on the purchase of a good or service. ... A flat tax, also called a proportional tax, is a system that taxes all entities in a class (typically either citizens or corporations) at the same rate (as a proportion on income), as opposed to a graduated, or progressive, scheme. ... Tax rates around the world Tax revenue as % of GDP Part of the Taxation series        The federal government of the United States imposes a progressive tax on the taxable income of individuals, corporations, trusts, decedents estates, and certain bankruptcy estates. ... Tax rates around the world Tax revenue as % of GDP Part of the Taxation series        A sales tax is a tax on consumption and is normally a certain percentage that is added onto the price of goods or services that are purchased. ... Taxation in the United States is a complex system which may involve payment to at least four different levels of government. ...

## Notes

1. ^ a b c d e f g h i j k l m n o p q H.R. 25: Fair Tax Act of 2007. 110th U.S. Congress. The Library of Congress (2007-01-04). Retrieved on 2007-01-14.
2. ^ a b c d e f g h i j Kotlikoff, Laurence. "The Case for the 'FairTax'" (PDF), The Wall Street Journal, 2005-03-07. Retrieved on 2006-07-23.
3. ^ a b c d e f g h i j k l m n o p q r Regnier, Pat. "Just how fair is the FairTax?", Money Magazine, 2005-09-07. Retrieved on 2006-07-20.
4. ^ a b c Forbes, Steve. "The American Dream Improving Our Lot", Forbes, 2007-03-22. Retrieved on 2007-03-26.
5. ^ a b c d e f g h i j k l m n Boortz, Neal; Linder, John (2006). The FairTax Book, Paperback, Regan Books. ISBN 0-06-087549-6.
6. ^ a b c d e Gale, William (March 1998). Don't Buy the Sales Tax. The Brookings Institution. Retrieved on 2006-07-23.
7. ^ a b c d e f g h National Retail Sales Tax (PDF). President's Advisory Panel for Federal Tax Reform (2005-11-01). Retrieved on 2006-07-23.
8. ^ a b Kotlikoff, Laurence; Jokisch, Sabine (2007-04-24). Simulating the Dynamic Macroeconomic and Microeconomic Effects of the FairTax (PDF). Boston University & Centre for European Economic Research. Retrieved on 2007-05-13.
9. ^ a b Kotlikoff, Laurence; Rapson, David (November 2006). Comparing Average and Marginal Tax Rates under the FairTax and the Current System of Federal Taxation (PDF). Boston University. Retrieved on 2006-11-04.
10. ^ a b c d e An Open Letter to the President, the Congress, and the American people (PDF). Americans For Fair Taxation. Retrieved on 2006-07-23.
11. ^ a b Committee on Ways and Means Hearing -Statement of Leo Linbeck. Committee on Ways and Means (2005). Retrieved on 2007-01-25.
12. ^ a b Sipos, Thomas (2007-07-10). A Fair Tax for Progressives and Conservatives. American Chronicle. Retrieved on 2007-07-13.
13. ^ a b c d e f g h i FairTax Frequently Asked Questions (PDF). Americans For Fair Taxation. Retrieved on 2006-10-18.
14. ^ a b c d e f g h i Ose, Al (2002). America's Best Kept Secret Fairtax: Give Yourself a 25% Raise, Paperback, Authorhouse. ISBN 1-4033-9189-0.
15. ^ a b H.R.25 108th Cosponsors. 108th U.S. Congress. The Library of Congress (2003-01-07). Retrieved on 2006-08-22.
16. ^ a b S.1493 108th Cosponsors. 108th U.S. Congress. The Library of Congress (2003-07-30). Retrieved on 2006-08-22.
17. ^ a b H.R.25 109th Cosponsors. 109th U.S. Congress. The Library of Congress (2005-01-04). Retrieved on 2006-08-22.
18. ^ a b S.25 109th Cosponsors. 109th U.S. Congress. The Library of Congress (2005-01-24). Retrieved on 2006-08-22.
19. ^ a b c H.R.25 110th Cosponsors. 110th U.S. Congress. The Library of Congress (2007-01-04). Retrieved on 2007-01-14.
20. ^ S.1025 110th Cosponsors. 110th U.S. Congress. The Library of Congress (2007-03-29). Retrieved on 2007-04-04.
21. ^ Linbeck, Leo (2006-10-03). Grassroots Leadership Council Conference Call (PDF). Americans For Fair Taxation. Retrieved on 2007-02-04.
22. ^ Bender, Merrill. "Economists Back FairTax Proposal", Budget & Tax News, The Heartland Institute, 2005-06-01. Retrieved on 2006-07-20.
23. ^ a b Linder, John; Boortz, Neal (2007-09-27). The Fair Tax: Saying Goodbye to the Income Tax and the IRS . American Solutions. Retrieved on 2007-10-04.
24. ^ H.R. 1040 110th Cosponsors. 110th U.S. Congress. The Library of Congress (2007-02-14). Retrieved on 2007-03-14.
25. ^ a b Vance, Laurence. "There is No Such Thing as a Fair Tax", Ludwig von Mises Institute, 2005-12-12. Retrieved on 2006-07-20.
26. ^ The FairTax Calculator. National Retail Sales Tax Alliance. Retrieved on 2006-07-23.
27. ^ a b c d e f g h i Rebuttal to the tax panel report and recommendations (PDF). Americans for Fair Taxation (November 2006). Retrieved on 2006-11-02.
28. ^ Boortz, Neal (2007-08-31). A FairTax Note. Cox Radio. Retrieved on 2007-09-01.
29. ^ a b c Bartlett, Bruce. "Fair Tax, Flawed Tax", Wall Street Journal, 2007-08-26. Retrieved on 2007-08-30.
30. ^ Institute for Policy Innovation (2005-09-26). Doesn't Anyone Know the Score?. Press release. Retrieved on 2006-07-20.
31. ^ a b c d e f g h i j Bachman, Paul; Haughton, Jonathan; Kotlikoff, Laurence J.; Sanchez-Penalver, Alfonso; Tuerck, David G. (November 2006). Taxing Sales under the FairTax – What Rate Works? (PDF). Beacon Hill Institute. Tax Analysts. Retrieved on 2007-03-06.
32. ^ a b c Burton, David; Mastromarco, Dan (1998-03-16). Rebuttal of the William Gale papers (PDF). The Argus Group. Retrieved on 2006-10-26.
33. ^ Burton, David; Mastromarco, Dan (1998-02-04). Rebuttal of the Joint Committee on Taxation (JCT) letter (PDF). The Argus Group. Retrieved on 2006-10-26.
34. ^ a b A Macroeconomic Analysis of the FairTax Proposal (PDF). Arduin, Laffer & Moore Econometrics (February 2006). Retrieved on 2006-11-07.
35. ^ a b Gale, William (2005-05-16). The National Retail Sales Tax: What Would The Rate Have To Be? (PDF). Tax Break. Tax Analysis. Retrieved on 2005-06-15.
36. ^ Gregg Esenwein (2005-07-19). The Potential Distributional Effects of the Alternative Minimum Tax (PDF). Center for Democracy and Technology. Retrieved on 2007-05-30.
37. ^ a b What is the difference between statutory, average, marginal, and effective tax rates? (PDF). Americans For Fair Taxation. Retrieved on 2007-04-23.
38. ^ a b Tuerck, David G.; Haughton, Jonathan; Bachman, Paul; Sanchez-Penalver, Alfonso; Viet Ngo, Phuong (2007-02). A Distributional Analysis of Adopting the FairTax: A Comparison of the Current Tax System and the FairTax Plan. Beacon Hill Institute. Retrieved on 2007-09-16.
39. ^ Chambliss, Saxby; Linder, John; King, Steve; Brady, Kevin. "Revise the tax law", The Washington Times, 2005-09-27. Retrieved on 2006-07-23.
40. ^ A Comparison of the FairTax Base and Rate with Other National Tax Reform Proposals (PDF). Beacon Hill Institute (2007-02). Retrieved on 2007-09-09.
41. ^ Kotlikoff, Laurence; Rapson, David (December 2005). Would the FairTax Raise or Lower Marginal and Average Tax Rates (PDF). National Bureau of Economic Research. Retrieved on 2006-10-10.
42. ^ Edwards, Chris (2005). Downsizing the Federal Government, Hardcover, Cato Institute. ISBN 1-930865-82-1.
43. ^ Summary of Estimates of the Costs of the Federal Tax System. U.S. Government Accountability Office (2005-08-26). Retrieved on 2006-07-23.
44. ^ Bartlett, Bruce. "The Times is still wrong on taxation", Free-Market News Network, 2005-10-11. Retrieved on 2006-07-23.
45. ^ a b c d e Linder, John. The FairTax. The Online Office of John Linder. Retrieved on 2007-07-17.
46. ^ a b c Linder, John (2007-01-30). Rep. John Linder updates volunteers. Americans For Fair Taxation. Retrieved on 2007-10-31.
47. ^ a b c Trowell, Christopher. Clean out America’s Economic Arteries. Committee on Ways and Means. Retrieved on 2006-07-24.
48. ^ Tuerck, David G.; Haughton, Jonathan; Bhattarai, Keshab; Sanchez-Penalver, Alfonso; Viet Ngo, Phuong. The Economic Effects of the FairTax: Results from the Beacon Hill Institute CGE Model. Beacon Hill Institute. Retrieved on 2007-09-18.
49. ^ a b Golob, John E. (1995). How Would Tax Reform Affect Financial Markets?. Retrieved on 2007-01-22.
50. ^ Trowell, Christopher. Statement on FairTax to Ways and Means. Committee on Ways & Means. Retrieved on 2007-06-20.
51. ^ Vargas, Melody. "Retailers Question Greenspan on Consumption Tax", National Retail Federation, About, 2005-03-03. Retrieved on 2006-07-24.
52. ^ Hodge, Scott; Atkins, Chris (2005-11-15). The U.S. Corporate Income Tax System: Once a World Leader, Now A Millstone Around the Neck of American Business. The Tax Foundation. Retrieved on 2006-08-03.
53. ^ Gaver, John (2006-01-10). The Economy Bomb Ticking Down Faster. Action America. Retrieved on 2007-06-20.
54. ^ Linbeck, Leo (2006-06-22). Testimony Before the Subcommittee on Select Revenue Measures. House Committee on Ways and Means. Retrieved on 2006-08-11.
55. ^ H. J. RES. 16. 110th U.S. Congress. The Library of Congress (2007-01-07). Retrieved on 2007-01-19.
56. ^ Linder, John. John Linder's FairTax FAQ. Congress. Retrieved on 2007-01-14.
57. ^ IRS Labor Force, Compared to National Totals for Civilian and Federal (Excel). Internal Revenue Service (2005). Retrieved on 2006-11-18.
58. ^ Gardiner, Pamela (2004-07-21). Treasury Inspector General for Tax Administration Testimony. U.S. Senate Committee on Finanace. Retrieved on 2006-11-18.
59. ^ "Household Debt: A Growing Challenge for American Families and Federal Policy", OMB Watch, 2006-07-25. Retrieved on 2006-08-07.
60. ^ Publication 936 (PDF). Internal Revenue Service (2005). Retrieved on 2006-11-13.
61. ^ Tuerck, David G.; Haughton, Jonathan; Bachman, Paul; Sanchez-Penalver, Alfonso; Dinwoodie, Sara (2007-02). The FairTax and Charitable Giving. Beacon Hill Institute. Retrieved on 2007-09-18.
62. ^ Types of Bonds. SmartMoney.com. Yahoo Finance. Retrieved on 2006-07-24.
63. ^ Edwards, Chris (2002-04). Top Ten Civil Liberties Abuses of the Income Tax. Cato Institute. Retrieved on 2007-07-13.
64. ^ a b Landsburg, Steven (1998). Price Theory and Applications, 4th edition (Hardcover), South-Western Educational Publishing. ISBN 0-538-88206-9.
65. ^ Boortz, Neal (2005-09-15). The FairTax - Straightening out some confusion. Cox Radio. Retrieved on 2006-08-04.
66. ^ Why retailers should support the FairTax (PDF). Americans For Fair Taxation. Retrieved on 2006-07-24.
67. ^ McTague, Jim (April 2005). The Underground Economy. Barron's. The Wall Street Journal Classroom Edition. Retrieved on 2006-07-25.
68. ^ Schlosser, Eric (2004-04-01). Reefer Madness: Sex, Drugs, and Cheap Labor in the American Black Market, Reprint, Mariner Books. ISBN 978-0618446704.
69. ^ Moffatt, Mike (2006). FairTax Quandry. About, Inc. Retrieved on 2006-09-06.
70. ^ a b Simplifying tax systems: The case for flat taxes. Barron's. The Economist (2005-04-14). Retrieved on 2006-07-25.
71. ^ a b c What the federal tax system is costing you – besides your taxes! (PDF). Americans For Fair Taxation (2007-02-19). Retrieved on 2007-03-27.
72. ^ California Sales Tax Enforcement Costs - Analysis of the 2004–05 Budget Bill. Legislative Analyst's Office (February 2004). Retrieved on 2006-07-25.
73. ^ The FairTax: What’s in it for the states? (PDF). Americans For Fair Taxation. Retrieved on 2007-01-29.
74. ^ Slemrod, Joel. "'The Fairtax Book' and 'Flat Tax Revolution': 1040EZ — Really, Really EZ", New York Times, 2005-11-13. Retrieved on 2006-07-25.
75. ^ Franks, Dale (2004-12-08). The NST v. the VAT. QandO. Retrieved on 2006-08-12.
76. ^ Franks, Dale (2005-08-25). Fair Tax Supporters: Whistling Past the Graveyard. QandO. Retrieved on 2006-07-25.
77. ^ Sales Tax FAQ. Sales Tax Institute. Retrieved on 2006-08-11.
78. ^ The impact of the FairTax on religious and other charitable giving (PDF). Americans For Fair Taxation. Retrieved on 2006-08-13.
79. ^ a b Linbeck, Leo. "Be Fair to FairTax -- Throw the Red Herrings Back in the Water", Wall Street Journal, 2007-08-29. Retrieved on 2007-09-02.
80. ^ Galloway, Jim. "On John Linder and Scientology", The Atlanta Journal-Constitution, 2007-08-28. Retrieved on 2007-08-30.
81. ^ Boortz, Neal (2005-09-07). Nealz Nuze. Cox Radio. Retrieved on 2006-08-07.
82. ^ Boortz, Neal (2006-05-25). Nealz Nuze. Cox Radio. Retrieved on 2007-02-26.
83. ^ Candidate Questions Answered. Retrieved on 2007-08-02.
84. ^ Davis, Teddy. "Thompson Flip Flops on Taxes?", ABC News, 2007-07-31. Retrieved on 2007-08-02.

## References

• Boortz, Neal; Linder, John (2006). The FairTax Book: Saying Goodbye to the Income Tax and the IRS, Paperback, Regan Books. ISBN 0-06-087549-6.
• Boortz, Neal; Linder, John (2008). FairTax: The Truth: Answering the Critics, Paperback, Regan Books. ISBN 978-0061540462.
• Kotlikoff, Laurence; Burns, Scott (2004). The Coming Generational Storm: What You Need to Know about America's Economic Future. MIT Press. ISBN 0-262-11286-8.
• Ose, Al (2002). America's Best Kept Secret: Fairtax: Give Yourself a 25% Raise, Paperback, Authorhouse. ISBN 1-4033-9189-0.
• McCaffery, Edward, J. (2006). Fair Not Flat: How to Make the Tax System Better and Simpler, Paperback, University Of Chicago Press. ISBN 978-0226555614.
• Warwick, Nelson (2007). Fair Tax: A Wolf in Sheep's Clothing, Paperback, AuthorHouse. ISBN 978-1434314628.

The FairTax Book, co-authored by Neal Boortz and John Linder, was published on August 2, 2005, as a tool to increase public support for the FairTax Plan. ... ReganBooks is a controversial American bestselling imprint or division of HarperCollins book publishing house, headed by editor and publisher Judith Regan, who has been called the worlds most successful publisher.[1] ReganBooks focuses on celebrity authors and controversial topics, sometimes from recent tabloids. ... ReganBooks is a controversial American bestselling imprint or division of HarperCollins book publishing house, headed by editor and publisher Judith Regan, who has been called the worlds most successful publisher.[1] ReganBooks focuses on celebrity authors and controversial topics, sometimes from recent tabloids. ... MIT Press Books The MIT Press is a university publisher affiliated with the Massachusetts Institute of Technology (MIT) in Cambridge, Massachusetts. ... AuthorHouse, formerly known as 1stBooks, is a print on demand publisher that provides aspiring authors self-publishing services. ... The University of Chicago Press is the largest university press in the U.S. It is operated by the University of Chicago and publishes a wide variety of academic titles, including The Chicago Manual of Style, dozens of academic journals including Critical Inquiry, and a wide array of texts covering... AuthorHouse, formerly known as 1stBooks, is a print on demand publisher that provides aspiring authors self-publishing services. ...

Results from FactBites:

 What Is the FairTax? - by - The Heartland Institute (208 words) The FairTax, pending in Congress as HR 25 and S 1493, is a non-partisan proposal that would abolish all federal income taxes, including payroll, self-employment, alternative minimum, income, capital gains, corporate, and death taxes, replacing them with a simple, visible, federal sales tax. FairTax advocates say it is a fair, efficient, and intelligent solution to the frustration and inequity of our current tax system, which particularly burdens poor Americans and fixed-income retirees. The FairTax proposal includes specific protections for those Americans, including ending the narrow, regressive Social Security tax, ending income taxes, and beginning a rebate to zero all federal taxes for Americans (with a legal Social Security number) whose annual incomes are less than poverty level.
 FairTax - Wikipedia, the free encyclopedia (8723 words) The FairTax Book, co-authored by Neal Boortz and John Linder, was published on August 2, 2005, as a tool to increase public support for the FairTax Plan. The current FairTax legislation was introduced by Linder in the House and by Georgia Republican Senator Saxby Chambliss in the Senate. Under the FairTax, households would receive a monthly tax rebate (known as a "prebate" as it would be paid in advance) equal to the estimated total FairTax paid on poverty level spending according to the poverty guidelines published by the U.S. Department of Health and Human Services.
More results at FactBites »

Share your thoughts, questions and commentary here