[danjarch]

To move the discussion to the idea of the "Fair Tax" itself. It has two major flaws and would gain thousands more if it ever became law. The first flaw is that it still hides the true amount of taxes you pay. That's the biggest reason the government has been able to grow out of hand. Most people think they get money from the government rather then get a portion of what they paid in, back. Unless your self employed or own a business, it's easy to forget that what you see on your W2 under medicare, social security, and fica is only half of what's been paid on your behalf. Then there is the unemployment tax that you never see but is paid on your behalf.

Of course there are plenty more taxes that you never sit down and write a check for, so don't often think about or figure out how much your paying, such as sales tax, exercise taxes, utilities taxes, airport taxes, telecomunications taxes, corporate income taxes, etc.. . All told we pay something like 48 cents out of every dollar we make in taxes. But most of it goes out with out our being aware or having to write a seperate check. The fair tax plan, repeats this existing flaw. Hiding the total amount of taxes paid in your name.

The second problem is that it creates a major disadvantage on small businesses. Think of a maid service that is state wide and buys it's cleaning products by the truck load, in condensed form. Being able to get a big discount for buying in bulk. It's then increased by being hit with a lower tax bill. Meanwhile a independent person working as a maid, is going to be paying as much as 3 times as much for cleaning supplies, this will be compounded since the tax difference would be again multiplied by three.

In simple terms, if bottle of off the shelf floor cleaner is $6 and the tax is 30% bringing the total to $7.80. Now that big company is only paying $2 for that same amount of condensed cleaner, adding in the taxes it comes to $2.60. So an already $4 disadvantage becomes a $5.20 disadvantage.

I know it doesn't seem like much, but imagine all the small plumbers, contractors, maids, and other trades that already have to manage to overcome there lack of bargaining power.

The third fault is that it is in no way safe from being manipulated by congress. As already mentioned they just love trying to use the tax laws to incourage or discourage behavor. You can just imagine what would be going on right now if we were under the fair tax plan. They would be trying to exempt green products from the tax, or trying to give out 6 month exemptions for this industry or that industry.