| | This does nothing to lower taxes, and would only shift around how they are collected. If it was the question between 23% theft via IRS vs. 15% theft (with corresponding reduction in govt spending) via consumption tax, the latter would be a clear winner. IRS would clearly be preferable if the numbers were reversed. Given that the tax is to still be 23%, however, the only consideration would be whether the other factors are less bad with consumption tax instead of income tax.
Obviously there would be a big one-time loss to businesses to switchover for more training, point-of-sale software upgrades, etc.
Trade off some transaction costs of companies doing withholding every two weeks and citizens spending 10s of hours each year doing tax forms with transaction costs of recording taxes on each transaction. Costs at payday are reduced but not eliminated in the majority of states which still have state income tax. Costs of adding collection of sales tax is entirely new in the few states which do not have a state sales tax.
Trade off federal government being aware of what you make - for instead knowing everything that is legally bought and sold.
With the same tax level, a one-time cost to change over, and what seem to me like higher transaction costs and decreased privacy, this 'fair' tax proposal actually manages to sound like a losing proposition compared to income tax and IRS.
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