[SALChamps03]

As I say at the end of the letter, this plan is still worth debating without the windfall pay increase for every wage earner. And there won't be any income or payroll taxes taken out of the new lower salary. And efficiencies can cause the amount to rise back up later to everyone's benefit.

There is no pay increase. If you make $50,000 a year, your employer pays you 50,000, but he takes part of it and sends it to the government. The cost to him is still $50,000. Under the Fair Tax, the employer pays you $50,000 a year, but instead of sending part of it to the government, he pays it all to you. Where is the pay increase? The taxes you would have paid are paid at the point of sale, instead of being withheld from your check.

[Dimples]

Sorry, I should have read further.

Under the Fair Tax, the employer pays you $50,000 a year, but instead of sending part of it to the government, he pays it all to you.

So from where does the cost savings come that allows the business to reduce his prices by the amount of the tax?