FairTax FACT: Retail prices no longer hide corporate taxes or their compliance costs, which drive up costs for those who can least, afford to pay.
FairTaxFraud: Corporations will still pay taxes, will still buy raw materials, will still hire labor, and will still pass on costs to the consumer. Nothing has changed there. The FairTax only deals with federal taxes. Again, the federal taxes lost will need to be made up by someone. However, under the FairTax the working poor and middle class will now be paying a huge 30 percent tax on new homes, a 30 percent tax on health care, surgery, prescription drugs, day care, legal services, etc. The FairTax Plan drives up the cost of good for the working poor and middle class to astronomical levels. Corporations and the rich make out like bandits. Why would anyone endorse a plan that treats businesses better than people? The alternative No-Tax Plan would allow the anybody (including corporations) to pay no taxes if all their income was earned at a job or manufactured in America with American workers.
FAIRTAXER: First, corporations do not “pay” taxes. They never have and they never will. What they do is pass their “tax burden” on to (in this order), their consumers (in the form of higher prices), their employees (in the form of lost or reduced pay raises), and their share holders (in the form of reduced dividends). Remove the “tax burden” and you have removed a cost – a cost that no longer needs to be passed on to you, the consumer. Second, the “raw materials” that corporations pay will be non-taxable, as ALL business to business taxes will be eliminated; the labor they hire will no longer be taxed on their income, and the employer will NO LONGER be required to pay their portion of FICA taxes. Those are all additional cost reductions that can (and most likely WILL) be passed on to consumers.
“the federal taxes lost will need to be made up by someone” ~ FairTaxFraud
FAIRTAXER: As the FairTax is a revenue-neutral replacement tax, there is no loss. The FairTax is designed to replace the taxes currently embedded in the goods and services we buy now. Over $25Million Dollars in research performed by 80 world renowned economists (including a Nobel Prize recipient) has shown that to be fact, not opinion.
“However, under the FairTax the working poor and middle class will now be paying a huge 30 percent tax on new homes, a 30 percent tax on health care, surgery, prescription drugs, day care, legal services, etc.“~ FairTaxFraud
FAIRTAXER: Let’s look at this from two different angles; the business angle, and the home buyer angle. First, the business angle: The FairTax untaxes all business to business transactions, it removes your employer’s share of payroll taxes (FICA, and eliminates all SECA taxes too), and it completely removes the federal tax burden from all US businesses; meaning that businesses no longer have to spend millions of dollars on tax compliance costs annually. That means HUGE savings on the business side from lumber and nails to the purchasing of hammers, specialty tools, and the hiring of labored workers. As costs drop in one area, the savings are passed on to others down the line.
Now, the home-buyer angle. You’re a hard-working American with a spouse and two wonderful children. You not only qualify for the prebate, you’ve registered for it and are now being reimbursed $564 per month ($6,767 annually). On top of the monthly prebate check, you have been relieved of paying federal income taxes, and you’re no longer paying that regressive FICA tax that has been stealing 7.65% of your pay. So, if you and your spouse earn a meager $40,000 between the two of you, instead of bringing home ~$31,000 annually, you are bringing home $46,767. That is an added $15,767 that can be used to help you buy that home you’ve dreamt of.
“The FairTax Plan drives up the cost of good for the working poor and middle class to astronomical levels. Corporations and the rich make out like bandits. Why would anyone endorse a plan that treats businesses better than people?“~ FairTaxFraud
FAIRTAXER: Incorrect. I don’t know where FTF get’s their “astronomical numbers”, but they are dead wrong. The FairTax Plan is a replacement tax, NOT an added tax. When Corporations get hit with taxes, what do they do? They increase their prices to cover those additional costs. Wouldn’t you agree? So wouldn’t it make sense that when taxes are cut, corporations would drop their prices because they no longer have those additional costs? And wouldn’t dropping their costs make them more competitive on the market? It sure makes sense to FairTaxers. Of course you may have the occasional outlier who doesn’t want to drop their prices, but they are only hurting themselves by doing so.
As for “the rich”, they will continue to pay the majority of taxes paid in the USA. How? By buying bigger, more expensive goods and by paying for more services. Look at is this way: Would you (I’m assuming you’re a regular “Joe” like me) ever buy a new Yacht to impress your friends? Me neither. Would you hire a professional Landscaping Company to maintain your 4 Acre land on a monthly basis? Me neither. Would you pay a professional Air Conditioning & Heating company to come in and clean your ducts semi-annually, or replace your filters quarterly? Me neither. Would you pay to keep an expensive Attorney on retainer throughout the entire year? Me neither. And would you pay some expensive tax attorney tens of thousands of dollars annually to find and exploit loopholes to save you money? Okay, well this last one won’t be an option under the FairTax because there won’t be any loopholes, but you see where I’m going with this right? They WILL continue to pay more taxes than we ever will. Just because you don’t know where their money goes, doesn’t mean they don’t spend it. These guys from FTF want you to believe that “the rich” are going to hoard all their money and switch to completely buying used – but they can’t, and they won’t.