The “Fair Tax”: An Idea
Who’s Time Has Come
Could it be
that before the bell tolls for the next tax day, taxpaying citizen Americans
could have a new tax system in place? Not likely. However, more and more
tax-weary Americans are demanding relief from the current crushing, and
complicated tax system, and the one idea gaining the most momentum is scrapping
the current tax system in favor of a “Fair Tax”.
Adoption of the Fair Tax would have an immediate, soothing impact on a shrinking American workforce that is simply no longer able to shoulder the heavy tax burden of our nation and its people. In short, the American workforce is being crushed by the increasing weight of our current tax system, and is in need of real relief.
The Fair Tax would do just that—moving the tax burden from the workforce to the consumer. Two bills in Congress, S. 1025 and H.R. 25 are proposing just that, and in fact, are drawing the attention of lawmakers who are being asked by constituents to support repealing the 16th Amendment and doing away with the IRS in favor of a progressive, benefit-laden “Fair Tax”.
So what is the “Fair Tax”?
Simply stated, the Fair Tax is a 23 percent consumption tax that would be
applied to all new purchases. In other words, for every $100 dollars spent,
consumers would be taxed $23. The more consumers spend, the more they are taxed.
But unlike the current tax system that requires workers to surrender 23 percent
for every $100 earned, the Fair Tax gives the consumer control over how much
they are taxed. Again, under the Fair Tax, consumers are only taxed on new
items--used goods, including big-ticket items such as cars are not taxed.
Considered a Federal Retail Sales Tax, the Fair Tax would replace the entire, and we repeat, the ENTIRE federal income tax and social security tax systems. This includes personal, corporate, capital gains, estate, gift, Social Security taxes and more. Americans would keep 100 percent of their earned income (minus state income taxes). Wages, savings and investments are never taxed. Unlike the current system, the Fair Tax actually encourages Americans to save aggressively. And if that weren’t good enough, the progressive tax would fully fund the federal government, and Social Security and Medicare!
Do we have your attention,
now?
Another important part of the Fair Tax system is the Prebate—a monthly advance
rebate to cover purchases of necessary goods and services up to the poverty
level. Some mistakenly think this is reserved for the poor. Not so. A prebate is
not tied to income levels, and is applied to everyone--except illegals (another
benefit to the Fair Tax system). Illegal aliens would not receive any such
benefit because they are here illegally.
In addition to giving
Americans control over their tax burden, the Americans for Fair Taxation, says
the Fair Tax would also stimulate the creation of more jobs, and allow U.S.
exports to sell overseas on a level playing field. While profit margins would
remain about the same on exported goods, AFT suggests the U.S. would be able to
sell for 22 percent lower. With the Fair Tax in place, the U.S. would also have
a “definitive pricing advantage, which foreign tax systems could not match.” (www.fairtax.org).
Yet another advantage to the Fair Tax is the elimination of corporate taxes.
With nearly every purchase consumers make, there are hidden taxes embedded into
the price—hiking it as much as 20-30 percent. The Fair Tax eliminates the need
for such a tax. As columnist George Will says, a Fair Tax would be a “great
incentive for businesses to relocate here”, and would “unleash freedom around
the globe.”
Is the Fair
Tax in our future?
Not right away. However, with organizations like AFT, Grassfire and others
aggressively spreading the word about the Fair Tax to citizens around the
nation, support is building, and it is hoped that this wave of grassroots
momentum will reach our Washington lawmakers to support legislation like S. 1025
and H.R. 25.
But Grassfire is also doing more. Through our national “Fair Tax” petition, we expect to rally a minimum of 100,000 citizen supporters who embrace forward-thinking changes to our current tax system. Though our Government may be slow to change, they will listen, and respond if enough Americans mobilize and demand action.
Take action with Grassfire today:
#1 – Add your name to our “Fair Tax” petition.
#2 – Share this
message with your friends, family and co-workers.
#3 – Call your Senators and Representative today urging them to fully support
Fair Tax
Act of 2005 (S.
1025, and H.R. 25 respectively). If you don’t know
the necessary contact information, call the Capitol Switchboard
at 202-224-3121.