The FairTax brings the world to America
If you haven’t heard of the FairTax, you really should check out the proposal. It’s a 23% national retail sales tax that replaces all current federal taxes including the income tax, payroll taxes, and corporate taxes, among others. In order to ensure that the burden of this taxation is not taken on by the lower class, the FairTax includes the prebate. The prebate gives money to every American family before the month begins up to the poverty level.
Bringing Capital Back Into America
Currently there are some $10 trillion dollars of capital that has been moved away from the United States into foreign assets in order to shelter these assets from the aggressive and oppressive United States tax laws.
All of this investment is currently building other nations roads, sending foriegn children to school, and building the very factories that steal American jobs.
Wouldn’t it be absolutely wonderful if we could bring all of this money back into America? Think about what America could do with $10 trillion in additional capital invested into our economy. Think how many jobs we could create, think how much would be invested in our future, in our economy. Think about how much would be purchased with those investment gains.
America – The Labor Front
If the FairTax were passed in America, our country would soon become the tax haven of the world. There would be no corporate taxes, which would enable foreign companies to move there operations to the United States in order to gain favorable tax advantages.
All of those manufacturing jobs that are heading elsewhere in the world would be on the next ship back to America because of the enormous tax advantages. Talk about creating jobs!
Prices Compete Globally
Since the FairTax is not charged to products sold to international customers, America no longer plays at a 20% disadvantage because the embedded tax the current system causes is gone. With the embedded tax removed Americans will pay that 23% FairTax, but if Apple sells iPod’s around the world they will be able to reduce prices because the embedded cost of taxation will be removed.
Therefore, America companies will be able to gain a greater share in the market. In this globalized market, it is important for companies to nail down as much of the international market as possible.
3 Responses to “The FairTax brings the world to America”
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I’m not against a consumption tax in principle - I’m not quite sold on it either.
But if there’s one pet peeve I have it’s proponents of the Fair Tax calling it a 23% sales tax - it’s dishonest. It is a 30% sales tax - period. Yea, yea if you compare it to the way the income tax is calculated then it’s 23% but that’s not how we calculate a sales tax.
If you buy $1 worth of goods you will pay $1.30…
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Jeff,
The reason it is defined as an inclusive 23% is because its the same way our current taxes are paid. You pay a certain percentage of your current income towards federal income tax right? Lets say its 23% You make $100K then you pay $23K in taxes. Guess what, you take home $77K so you paid 30% of that in taxes, 0.30*$77K=$23K. So a good that is worth $1.00 has $0.23 worth of tax already included.
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David,
As I said in my original comment I understand why they define it the way they do. But that doesn’t make it any less dishonest. Nearly everybody in this country pays a state sales tax and they are accustomed to how that gets calculated. If you start talking about a national sales tax then you should use the axioms already in place for how a sales tax gets calculated.
It should be advertised as a 30% sales tax…
Jeff Pruitt
September 20th, 2008 at 10:33 pm