Tax Update Blog: Permalink

Fairtax is based on absurdities, and fallacies.

The absurdity first -- taxing the federal government to pay for federal government. Boortz writes "The federal government itself will become a major taxpayer" (Page 148)

Thats because Boortz would tax the government on all purchases,

Thats like taxing yourself 10,000 dollars a day. Silly stuff really. You can write the check, you can even desposit the check, but at the end of the month, you sure as hell dont have 300,000.

You can pretend the US Navy gives the Treasury 4 billion dollar sales tax on a 12 billion dollars air craft carrier. You can even have the Navy write the check, and the Treasury deposit the check. But the government sure as hell doesnt have 4 billion more dollars.

Thats just ONE thing. Boortz HAS to pretend he can tax the government -- or his numbers wont add up. The reality is, he cant tax the federal government to pay the federal goverment.

The fallacy next.

Its a fallacy that fair tax "eliminates the tax burden on middle and lower income Americans." Because middle and lower income Americans get cancer, have operations, go to nursing homes, need medication. A 23% tax on cancer surgery and chemo could be 50,000 in sales tax! Nursing home patients could have 30,000 a year in sales taxes!

These people would scream bloody murder -- and get exemptions.

SO would renters. Rent, incredibly, is taxed 23%.

So -- big chucks of the economy, Fairtax wont be able to tax. Health care, rent, and goverment spending. Wont happen. But if Boortz admits that, he has to admit the fairtax rate would be ove 60%.

Oh yes, supposedly fairtax will make all cost go DOWN and then the fairtax just replaces it.

NON SENSE. Ask any apartment complex owner how much FICA he pays (thats the main embedded tax) Its less than 1% of his total receipts. He can't cut his rent 22% when he only saves 1%.

My family owns a small business. It would save about 3% from not paying FICA for employees. We sure as hello can't cut our prices 22% cause of that.

This tax is a farce. IT might sound good, if you buy the premise. Too bad, the premise is a shell game, and wishful thinking, and BS.

Why would I want to pay 23% or whatever the correct number would be when my wife and I pay less than 10% now on income in the low 6-figures? We use TurboTax to do the returns and this takes less than one hour because we have our records organized. This FairTax thing is a scam being perpetrated on unsuspecting citizens by Boortz, Fairtax.org and their following for whatever nefarious reasons.

I recommend going to the site below and read an actual analysis of the "plan" by an economist/accountant professor
http://www.mises.org/story/1975

Don't be fooled into advocating for something that will really hurt you in the long run.