A FAIR TAX PLAN
October 20, 2006
Junking the current tax system in its entirety would create a modestly graduated tax system with a very broad base - consumption -- says economic columnist Scott Burns.
By replacing both the income tax and the employment tax (among others) with a single sales tax, we would accomplish these good things:
- Eliminate the fastest-growing and most regressive tax in our lifetime -- the employment tax.
- Massively broaden the tax base from only some income to all consumption.
- Eliminate the corporate income tax and the entrenched, corrupting lobbies that it has engendered.
- Make visible, for the first time, the size of our collective tax burden.
- Save the incredible amount of time and money wasted on tax planning and scheming.
- Create a path for dealing with the unfunded liabilities of Social Security by increasing the tax base that supports it.
- End the biannual festival of finger-pointing and envy that has become the hallmark of every election cycle.
- Remove the embedded expense wedge that reduces the competitive position of American-made goods.
The Fair Tax proposal calls for giving all households a so-called pre-bate of what they would pay in sales taxes for the necessities of life. The pre-bate would be paid to households monthly, eliminating the burden of taxes on our poorest families.
Because of the pre-bate, the new tax would amount to a graduated tax, says Burns.
Source: Scott Burns, "Some call Fair Tax plan unfair," Dallas Morning News, October 19, 2006.
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