Ten Reasons the Fairtax was the Best Tax Plan in 2006

1. The Fairtax will build this economy as no other system of taxation will. It has been estimated by several economic think tanks including one from Prof. Kotlikoff and other economists and professors that in the first year of implementation of this new consumer-based taxation that the economy of the U.S. will increase tremendously. He predicts that the GDP will rise by about 10% or more! When you consider that a 4% rise in GDP is considered very healthy, you can only imagine how increasing this by 2.5 times that rate will spill through our entire economy and improve life for every American. The GDP tags domestic production and when that production goes up, more income is created for citizens, more jobs are created, and more purchasing goes on, stimulating the economy all that much more.

2. The Fairtax will help alleviate and turn around poverty . Is it a panacea? No. But what it will do is this: every family will receive a rebate for the taxation they spend based on figures from the Department of Health and Human Services. This will give monthly rebates to all wage earners to the amount spent at the poverty level, thus exempting the poor from paying any tax at their income level. For instance, a wage earner who supports a total family of four will receive a rebate around $400/mo. for all the taxes he/she has paid for the previous month. It will really reduce the burden of taxation on the working poor and struggling middle class.

3. The Fairtax will enable every taxpayer to take home the entirety of his/her paycheck with no witholding whatsoever. Thus if you make $360/wk. you take home that full $360 instead of around $300. Would that make a difference to struggling families? You bet it would! It would put around $240/mo. extra into the pockets of that wage earner who worked hard for his/her money. Then, add to that the monthly rebate of around $400 for a family of four (remember point # 2 above?) and you're looking at a considerable income increase. Even if you're married and have no children and both spouses are working, each person will receive a rebate for themselves and take home their entire paychecks. Goodbye witholding. Goodbye April 15th gloom and angst. Goodbye the nightmare of filing and fear fo being audited and penalyzed for an inadvertant mistake.

4. Saving is not taxed as it is now. When we are taxed from our paychecks that is one time. But suppose you decide to tighten in your belt and save a few dollars from each paycheck and either put it in a savings account or invest it. You are taxed on the interest or gains on that investment when you draw it out. That's a second taxation on that initial money you earned from that one paycheck. Then, in addition, you're taxed again at a very high rate, when you die and want to leave that money to your family and children. This is yet another taxation on that paycheck. So, friends, our dear, wise Congress has chosen to allow the benevolent IRS to take money that you earned One Time and tax it three or four times, thus stealthily hiding their greed from the hard working taxpayers. The Fairtax does not tax ANY savings, period. Thus hard working citizens and the poor, especially, will be able to save with less hardship and to reap the entire reward for that saving without tax penalty. The Fairtax is designed to promote saving and to promote wealth and growth for even "the little guy," and to eradicate the built-in punishment for saving and prosperity by the present income-based system.

5. The Fairtax will eliminate Corportate taxation and its system of passing their taxes to consumers. Only consumers pay taxes. In reality corporations do not; they simply pass their tax burden and compliance costs on to the consumer. This is a truism which is well known to educated people, but not apparent to millions of Americans. It is a truth acknowledged by the likes of Alan Greenspan and any tax account worth his/her salt. It's just a fact. When these taxes are passed on to the consumer, who is hurt? The consumer pays and the corporation pays in inability to increase their competitiveness. Corporations either have to raise their prices or lower their pay in order to increase their profit share. They may move offshore and use layoffs to do this. Who really suffers are the taxpayers who foolishly believe the demogogic dribble doled out to them by politicians that advocate "punishing" the "evil and greedy" corporations. The corporations have a bottom line and if you punish them, they will simply pass on that punishment to their consumers or move offshore to escape some of the burdens of doing business in this country. The Fairtax will take out corporate taxes and encourage pricing competition, which will drive prices down very quickly. It will also encourage companies offshore to move back inside the U.S. Moreover, it will attract overseas companies to move to the U.S. because of the Zero taxation available here. The total effect is to create a magnet for the economy and to create new jobs in manufacturing, a sector which has all but dried up in the last half century. One's imagination is unlimited when considering the benefits of this facet of the Fairtax. Removal of corporate taxes will especially help mom and pop businesses hurt by big box stores like Walmart and even the playing field.

6. The Fairtax will fund Social Security and Medicare. At the 23% tax inclusive rate on purchases of new items the tax will fund all government obligations for social security and Medicare at the present rate. Of course, we need to insist that congress be restricted from raiding the so-called "trust fund" that was dissolved and moved to the general fund. But this is a separate issue. As written, the social security and Medicare costs will be funded by consumption instead of depending on an ever-dwindling pool of young workers paying in the system to fund pensions of an ever-increasing baby boomer explosion of retirees. As funded now through the income tax system the entire social security system is due to melt down and become bankrupt in some estimated 20 years. If allowed to continue with the IRS system of taxation, we can expect to see a gutless Congress constantly either increase the age of eligibility or to place an ever more onerous tax on the already stressed out young people who are supporting this huge idiotic Ponzi Scheme. The Fairtax is the ONLY solution to this problem that should be pleasing to both parties.

7. The Fairtax is entirely discretionary. While it is true that we Have to purchase some items like food, gas for automobiles, our housenotes and utility bills, we get no payback for those purchases or deductions for them from our tax. The Fairtax Will offer a sort of prebate for these necessities at the poverty level. The rest of our purchases are mainly discretionary and we can choose to cut back on them for a while if we choose to save for something in the future, or we can purchase whatever we want. With a full paycheck and the reduction in prices from the elimination of corporate "pass-on" taxes, purchase costs are estimated to fall within the range that they're at now more or less, even with the Fairtax added back in at the check out counter or in a sales contract. The proportion of their paychecks spent on taxes by the poor should actually be much less than it is now, given the monthly prebate and the full paycheck. The very wealthy will also make larger purchases consistently. They will get the prebates too, but the effect on their income will be miniscule, while their ability to spend large money on big ticket items will remain the same.

8. The Fairtax will make the system of taxation fair, simple AND Progressive. Under the IRS income tax, if you're a millionaire, you probably have elaborate set ups to shelter your money and reduce taxation. Under the Fairtax there would be no longer any reason whatsoever to keep up this charade and play the game of tax avoidance through expensive and complex legal maneuvers or to take their money in offshore accounts. They would see all their income with no ability of avoidance whenever they make a purchase. They will not stop making large-scale purchases, but a lot more taxes will be captured for the government coffers when they do purchase. Because every purchase of a yacht or a brand new Lexus will put 23% of that purchase into their tax component.

9. The Fairtax will save an estimated $200 Billion to $300 Billion in annual compliance costs for the entire economy. Small businesses, corporations, and individuals will be saved vast amounts of time, stress and money yearly. From having to hire people to decipher this ridiculous several million word long atrocity that is today's tax code, to having to spend sleepless nights in worry and stressful days gathering files and notes and receipts to file with, our tax system is a true atrocity that has been growing tentacles and reaching deeper and deeper into our pockets since its questionable inception in the year 1913. It has done nothing but create a system which encourages back room deals, corporate lobbying fortunes and scandals, turn our nation's capitol into a cesspool of money-trading which would make Scrooge ashamed. It has created a vast segment of privileged in a sea of increasingly impotent and beleaguered workers. While pretending to be "progressive" it is anything But that. The fortunes of the very wealthy have grown while the hard-working middle class has been shockingly shrinking year by year, now assaulted by the dreaded "alternate minimum tax" that is for the first time encroaching into the legions of middle class taxpayers who never thought it would hit them. Never having factored in inflation indexing, this despicable tax is one more incompetent scam that demogogued its way into the tax code by using class warfare and the ridiculous accolade of "progressiveness" to push its way through a myopic, cowardly, greedy and incompetent Congress.

10. I leave this one item for last because it has less to do with the specific benefits as it does with something less tangible. However, it is perhaps the most important advantage of the passage of the Fairtax (refer to #9 above). Our system is not only broken, it is severely corrupt. Much of what goes on inside the cesspool beltway is very secretive in the sense that nobody has the time or the experience to follow what is in the bills passed in Congress. We rely on the mainstream or alternate media, most of which is either under-informed or incompetent. One hand feeds the other in the system, while the poor working stiff gets stiffed. When the Fairtax is passed every single person making a purchase will know immediately what tax he/she is paying pure and simple. It's right there on your receipt or sales slip--no hiding it in witholding, no bait and switch on social security and Medicare funding. No more sleight of hand by our talented but ignorant "elite" magicians who hobnob together in the hallowed halls of Congress and wine and dine each other and take lobbyist junkets paid for by you and me, pal. Sure, there'd be some lobbying going on in that little club, but it would not involve the very much of the tax system like the majority of it does today.

11. I must include another very important feature of the Fairtax that must be realized by anyone investigating this total reform. This tax will provide a partial relief from the illegal immigration issue. While not "solving" it, the Fairtax will capture a huge amount of revenue from the illegals living here and acting as parasites on the benefits systems, while sending most of their money home and not paying their fair share of taxes. Every time they make a purchase they WILL pay the tax. But if they do produce a verifiable social security number they will Not be able to get the monthly rebate. Chew on this for a moment. We could be collecting considerable revenues from the estimated 11-20 million illegals living in this country today. Now think about something else. Do drug pushers and porn pushers pay income tax on their smutty gains? Heck no. But under the Fairtax they certainly would. Even if they happened to have a job and qualify for the monthly prebate, they would also now be looking at paying their taxes on the SUVs and snazzy jewelry they purchase with these illegal activities. Then look at the visitors to these shores--the visiting students and tourists--another source of income which is completely untapped by the IRS system. Every purchase made by a tourist would go to the government coffers.

In closing, I will tell you that we will vastly increase the base of taxpayers--through tourists, exchange students, pimps, drug and smut peddlers, and the huge hoard of wealthy who will no longer be able to shield their taxes offshore and escape or minimize taxation. That's four very large sectors that the present IRS does not tax or taxes at the minimum possible. With a larger base to draw from and the more steady and reliable method of taxing consumption, the entire system of collection will be more fair, effective, reliable and cost-effective. AND. . .it finally Will be progressive.