Is the Fair Tax Act a fair tax act?

Have you ever heard of the Fair Tax Act?  It is a pro­posed bill which would (with par­al­lel leg­is­la­tion) repeal the 16th Amend­ment to the Con­sti­tu­tion of the United States of Amer­ica, abol­ish­ing the IRS and fed­eral income tax, replac­ing the sys­tem with a national sales tax.  I am still read­ing up on the Fair Tax Act and the orga­ni­za­tion behind the move­ment, so it would be irre­spon­si­ble for me to offer an opin­ion about either at this time.  At first glance, how­ever, it seems like an inter­est­ing idea that deserves some attention.

From the Fair Tax web­site:

The Fair­Tax plan is a com­pre­hen­sive pro­posal that replaces all fed­eral income and pay­roll based taxes with an inte­grated approach includ­ing a pro­gres­sive national retail sales tax, a pre­bate to ensure no Amer­i­can pays fed­eral taxes on spend­ing up to the poverty level, dollar-for-dollar fed­eral rev­enue neu­tral­ity, and, through com­pan­ion leg­is­la­tion, the repeal of the 16th Amendment.

The Fair­Tax Act (HR 25, S 296) is non­par­ti­san leg­is­la­tion. It abol­ishes all fed­eral per­sonal and cor­po­rate income taxes, gift, estate, cap­i­tal gains, alter­na­tive min­i­mum, Social Secu­rity, Medicare, and self-employment taxes and replaces them with one sim­ple, vis­i­ble, fed­eral retail sales tax  admin­is­tered pri­mar­ily by exist­ing state sales tax authorities.

The Fair­Tax taxes us only on what we choose to spend on new goods or ser­vices, not on what we earn. The Fair­Tax is a fair, effi­cient, trans­par­ent, and intel­li­gent solu­tion to the frus­tra­tion and inequity of our cur­rent tax system.

The Fair­Tax:

• Enables work­ers to keep their entire paychecks
• Enables retirees to keep their entire pensions
• Refunds in advance the tax on pur­chases of basic necessities
• Allows Amer­i­can prod­ucts to com­pete fairly
• Brings trans­parency and account­abil­ity to tax policy
• Ensures Social Secu­rity and Medicare funding
• Closes all loop­holes and brings fair­ness to taxation
• Abol­ishes the IRS

I am inter­ested in hear­ing what oth­ers have to say about the Fair Tax Act.  I have a bit more research to do before I ren­der my own opin­ion, but I have to admit that I love the idea of abol­ish­ing the IRS.  Our tax sys­tem is flawed, unbal­anced, and needs to be replaced.  Not repaired, but replaced.  Is the Fair Tax Act the way to go?

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