23% national tax

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[quote="farmerc83"][quote="Skip OK"]When I have heard about the Fair Tax previously it was to replace the current income tax system; not to cover Income tax, Social Security tax, estate tax or any excise taxes. If this is not true, then the "5% of the taxpayers pay 95% of the taxes" statement is obviously untrue, since Social Security taxes for every working American equal 14% of salary (you pay 7% and your employer pays 7%).[/quote]

Explain your logic here. You said yourself that this wasn't just taking Social Security with its set percentage into account. Add in income and estate taxes and it makes perfect sense cause rich folks have larger incomes and estates to be taxed on, plus the incomes are taxed at higher percentages. Throw in gift taxes and the fact that at least 40% of folks don't pay taxes and the 5% pay 95% doesn't seem that far fetched.[/quote]


The point I was trying to make was that, if you include the payroll (Social Security) tax as what "people are paying now", then the "95 % of taxes are paid by 5% of taxpayer" statement is clearly wrong. The difference between the dollar amount of payroll tax paid by the(very few) richest workers as compared to the (very many) poorest workers simply isn't that great.

If the Fair Tax is simply to replace the income tax (which is by far the most inequitable part of our individual tax bill) then a 23% rate might work.

[GAHEEL83]

It's a great idea as it would abolish the personal income tax AND the corporate income tax rate of 35%, which is the second highest of all industrialized nations in the world. This rate is also one of the main reasons that many of our corporations are being aquired and moving their headquarters to other counties because of the competitive advantage that the lower rate in other countries provides.

Embedded taxes like the corporate income tax add over 50% to the cost of any item purchased in this country; the flat tax would remove all of the imbedded taxes and the price of goods would go down substantially. With no corparate income tax, corporations would flock back to the US and you would have to hide not have a good job.

I highly recommend the book The Flat Tax by Representative John Linder and Neal Boortz. Linder is a Republican congressman from GA and Boortz is a Libertarian talk show host.