Both the FairTax and the flat tax reduce marginal tax rates dramatically, though the FairTax does more so.

This is an excerpt from fairtax.org/flattax. It explains why the flat-tax (HR1040) hurts middle-class America and how the FairTax treats every citizen who spends above the poverty level equally.

Flat tax supporters often emphasize, correctly, that marginal tax rates, rather than average or effective, are the most economically relevant tax rates. It is the marginal tax rate that affects an individual’s decision about what to do.

A consumption tax can be viewed as imposing a zero marginal tax rate on labor and
capital income, if the economic incidence of the tax is on consumers. Alternatively, one canview the incidence of the consumption tax on the factors of production (labor and capital). The comparison below is based on the view that the consumption tax is incident on the factors of production.
The most commonly quoted flat tax legislation would reduce the top marginal income tax rate to 17 percent. This rate, however, is not revenue neutral. The flat tax is revenue neutral at about 21 to 22 percent, not taking into account the impact of the plan on economic growth. In the real world, the flat tax would cause economic
growth that would increase the tax base, perhaps reducing the revenue-neutral
tax rate to 20 percent (within a few years). The flat tax would not affect the employer or employee Social Security or Medicare payroll tax. Those that have earnings below the Social Security wage base ($90,000 per worker in 2005) would, therefore, face a marginal tax rate of 32.3 percent. Taxpayers over the Social Security wage base
would face a marginal tax rate of 19.9 percent on wage income and 17 percent on capital income. These figures are about 3 to 5 percentage points higher in a revenue-neutral flat tax.
Under the FairTax, the poor experience negative effective tax rates because of the
universal rebate. No American pays any tax on spending up to the poverty level, but this is most telling with the poor. Affluent taxpayers pay 23 percent at the margin.
Thus, middle-income taxpayers pay a much lower marginal tax rate under the
consumption tax than under the flat tax. This is because the FairTax replaces payroll taxes as well as the income tax. Affluent taxpayers pay comparable marginal tax rates under the consumption tax and the flat tax. These differences are summarized in the table below.
Comparative-Marginal-Tax-Rates

Comparative Marginal Tax Rates

The FairTax generally has a more positive impact on marginal tax rates than does the flat tax.

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