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BHI on the FairTax

 

BHI Studies on the FairTax

As 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.

Previous 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.

BHI Studies (PDF)

A Comparison of the FairTax Base and Rate with Other Tax Reform Proposals

A Distributional Analysis of Adopting the FairTax: A Comparison of the Current Tax System and the Fair Tax Plan

The Economic Effects of the FairTax: Results from the BHI CGE Model

The FairTax and Charitable Giving

Tax Administration and Collection Costs: The FairTax vs. the Existing Federal Tax System

Fiscal Federalism: The National FairTax and the States

See also Tax Notes Reprint November 2006
Taxing Sales Under the FairTax: What Rate Works? Complete Study (PDF)
& Tax Notes Memo to Bruce Bartlett February 2008
The FairTax: Response to Bartlett's Critique

Taxing Sales Under the FairTax: What Rate Works?
BHI Presentation to American Enterprise Institute, February 2007

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