Second in a series of commentaries in support of the Fair Tax Bill.
By PAUL LIVINGSTON
Reform is defined as removing abuse, eliminating bad practices and change for the better.
The American Institute of CPAs at their website www.aicpa.org has a list of criteria to evaluate proposed tax reform. The FairTax bill HR25/S122 is based upon the following five principles and is in compliance with the AICPA criteria for tax reform:
• Fair: This means no loopholes, no special deals, no exclusions, no class rates and no exceptions. Everyone is treated alike.
The present tax code divides us into classes based upon income. United we stand; divided we fall.
The Fair Tax is one rate of 23 cents per dollar in the sale price of all new goods and services. The rate of 23 percent is figured inclusively in the retail price of goods and services just like our present income and payroll tax rates are figured inclusively on our pay. The same 23 cents per dollar tax would be 30 percent if figured exclusively or as an addition to the sale price.
The Fair Tax system is progressive because of the rebate to not tax purchases up to the poverty level as determined by the Department of Health and Human Services. This monthly tax rebate in the Fair Tax system is called a “prebate” as it is sent out the first of each month to all registered families with valid Social Security numbers.
The Fair Tax is a progressive tax, capped at 23 percent, on the standard of living that the family can afford. Imagine regaining lost economic freedom by controlling how much tax you pay by controlling how much you spend.
The Fair Tax greatly reduces the taxing powers of politicians, lobbyists and special interest groups to use the tax code to their advantage and best interests.