It will certainly all shake out in the end before the bill is passed - and it will be passed since there are too many benefits to the US economy for it not to pass.
Regardless of the differences on the percent of wages taken home (or not), there is still he matter of business income taxes (and no, s-test, that is not just Subchapter C-corps but all businesses). Those cascading embedded taxes are done away with by the FairTax whether you admit it or not - and they are sizeable. Are you pretending that they do not go to lowering prices?? And the taxes ARE calculated as the amount of tax paid divided by the amount of income subject to taxes just as the example (and the IRS SOI) shows (called "tax rate" in the example) and NOT as a percent of revenue.
Keep in mind the example included only business income taxes and not employees' taxes or compliance costs. So that others can see how the embedded tax mechanism works, here's the example again using the marginal tax rate of the Subchapter C corporations that s-test insists are the only business tax payers:
LEVEL 1 2 3 4 5 6 INPUT $1.00 $1.44 $2.08 $3.01 $4.34 $6.27 33.00% PROFIT MARGIN $0.33 $0.48 $0.69 $0.99 $1.43 $2.07 34.40% TAX RATE $0.11 $0.16 $0.24 $0.34 $0.49 $0.71 SELL PRICE $1.44 $2.08 $3.01 $4.34 $6.27 $9.05 Accumulated tax costs $0.11 $0.28 $0.51 $0.86 $1.35 $2.06 Tax costs as % of 7.86% 13.31% 17.09% 19.70% 21.51% 22.77% sell price
And, oh, yes, s-test does not understand the mechanism and tries to make it out to be some sort of compilation of arriving as a sales price - that's not what's involved but instead is an insight into how income tax paid by business is embedded into prices and cascades being taxed again at the next level. Nightie also tries to warp this into something it is not.
What it is is a simple example that clearly illustrates the mechanism of cascading embedded tax costs - these are over and above tax on employees wages and over and above compliance costs.
Your chart is a pathetic joke a normal person would be ashamed of. It's not based on any reality whatsoever...
The Boortz/Linder book clearly sells the plan as being one where all wage earners would realize an immediate gain in purchasing power. This is an impossible "free lunch" plan when it is described that way. Dr. Jongenson confirmed that he was NOT modelling a "free lunch" plan.
Perhaps the misrepresentation is inadvertent and caused by ignorance, I do not know. I do not allege malice. But now that they have been made aware of the error, they must take some action to correct the wrong explanations that they have given in their book.
As I have said many times, my interest in this is to discuss the FairTax plan honestly as it was intended to be implemented and then decide whether it is a good approach or not.
You, pigdog, appear to still cling to your dreams of the "free lunch". Face the facts, pigdog, without the worker payroll and income taxes reduced from a businesses costs, there is nothing else to get an immediate reduction of more than about ten percent-- tops. And it could be as low as 7-8% savings.
A more controllable way to decipher these accumulated tax costs is to reverse the model offered by pigdog (as my original treatment of this topic did.) By starting with consumer price and recursively extracting tax costs from any number of levels of production upstream, the model quickly approaches a finite limit of the true embedded tax (ie, the model converges) rather than exploding ad-infinitum depending on the inputs and number of levels you choose (ie, the model diverges.)
This top down approach will never give such untennable answers as "the tax accumulated after the nth level of production exceeds the total of all Federal tax receipts..." as pigdog's method can. And it doesn't require you to know the number of level of production ... by choosing a suitably large number, the top down model converges.