FAIRTAX: RESPONSE TO BARLETT'S CRITIQUE
Studies on the FairTax
specified in Congressional bill H.R. 25/S. 25, the FairTax
is a proposal to replace the federal personal income tax,
corporate income tax, payroll (FICA) tax, capital gains, alternative
minimum, self-employment, and estate and gifts taxes with
a single-rate federal retail sales tax. The FairTax also provides
a prebate to each household based on its demographic composition.
The prebate is set to ensure that households pay no taxes
net on spending up to the poverty level.
studies suggest that the effective (tax inclusive) tax rate
needed to implement H.R. 25 is far higher than the proposed
23% rate. But according to the Beacon Hill Institute, a 23%
rate is eminently feasible and suggests why others reached
the opposite conclusion. In addition to determining the FairTax
rate, BHI has also studied its effects on the economy at large
and charitable giving and tax equity.
Comparison of the FairTax Base and Rate with Other Tax Reform
Distributional Analysis of Adopting the FairTax: A Comparison
of the Current Tax System and the Fair Tax Plan
Economic Effects of the FairTax: Results from the BHI CGE
FairTax and Charitable Giving
Administration and Collection Costs: The FairTax vs. the Existing
Federal Tax System
Federalism: The National FairTax and the States
also Tax Notes Reprint November 2006
Sales Under the FairTax: What Rate Works? Complete
03/07/2008 2:01 PM
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