Why FairTax is stupid



1. Tax collection responsibilities are shifted from the IRS to the state, to coincide with the current state sales tax collection infrastructure.

I'm not sure if you've noticed, but states are even more corrupt that the federal government. The last time I checked, the state of New Jersey has shut down all state-sponsored prescription plans, the state gaming commission, and countless other programs while sending home wihtout pay 10's of thousands of state employees because they cannot agree on a 2007 budget.

Links: http://www.nj.com/news/expresstimes/nj/index.ssf?/base/news-2/1152158828188530.xml&coll=2

2. All cash expenditures are linked directly to you.

To further investigate this claim, I will need to read further into the matter. However, no literature I have read on the matter discuss the specific tax collection practice. Even a cursory look at the collection will lead you understand that a record needs to be kept by both the retailer and customer about each transaction (sale). This will require the retailer to uniquely identify you (social security number). Also, it is quite likely in practice that any such system will be implemented such that your "sales record for tax purposes" will be kept associated with your itemized sales receipt. What this creates is a record of every retail item purchased in the US to its purchaser.


P.S. Anonymous purchases could be abused. Since one would simply purchase all but $10,000 of products anonymously, be considered poor, and have that money returned.

3. Let's just barter and forget these stupid records
The black market would destroy real businesses, since their prices are 23% cheaper. Some claim government intervention would alleviate this. Large businesses would be hit hardest by this factor, and they would be the largest (sole) force presuring the FairTax investigators. Through the influence, this would mean that only small businesses will be scrutenized for tax purposes. This will result in the largest infiltraction of the tax collection agency by large busineses since Scientology.
4. The Foreign Market
1. Put your money in a Swiss bank
2. Buy all your shit overseas.
3. ... (this step isn't even necessary)
4. Profit!!!


Anonymous said…
I see now that sales receipts not need to be kept. Other arguments remain.
Anonymous said…
After enlightenment, I now understand:

What is the worst possible tax system?

One that has been "clarified" for over a hundred years.

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