The FairTax is a system that seeks to replace our current tax system and replace it with a national sales tax. To do this, it will repeal the 16th Amendment and abolish the income tax, estate tax, gift tax, capital gains tax, alternative minimum tax, Social Security tax, Medicare tax, self-employment tax, and corporate taxes. The sales tax will have to be set high enough to bring in the same amount of tax revenue as our current system does.
What makes it awesome?
- The true percentage Americans pay in taxes is rolled into a single sales tax. Americans are aware of this painful number every time they go to pay for something.
- Transparency! The government can no longer secretly raise taxes through miscellaneous increases in fees, fines and taxes without everyone knowing. They are exposed.
- American exports will instantly be worth ~23% more internationally. This will bring jobs back to the USA.
- Tax dodgers will have to pay.
- Illegal immigrants will have to pay.
- Drug dealers will have to pay.
- Tax day is gone. This will save us an estimated $265 billion/year in tax administration. The IRS will cease to exist. Tax accountants will have to find real jobs.
The FairTax seeks to keep our current progressive (tiered) tax rates so that the rich pay a higher percentage (currently 35%) than the poor (currently 0%). Since it eliminates the income tax, there is no "tax day" and no rebate at the end of the year. Instead, it replaces this with a prebate. What makes this great is that the prebate is sent out in advance, every month and to every American. Here is what it will look like:
Politicians. The FairTax is a major threat to them, because it removes the power they have over us to easily increase taxes and increase the size of government. Only a handful of honest, financially smart politicians support it. FairTax is a neutral goal and will benefit every American.
What can you do?
- Get the word out. Talk to your friends and family and tell them about it. Once enough people support it, politicians will be forced to vote in favor of it or they will be in jeopardy of losing their jobs.
- Write your Congressman - tell them you support it:
- As a last resort, people can start a movement in their state to amend the Constitution. Congress can be bypassed, if 3/4 of state legislatures ratify a Constitutional amendment.
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