[Eagle of Liberty]

When I do a service for $130, I can legally only keep $100 and must remit the $30 to the state. I have $100 to spend. When a drug dealer/prostitute get $130 they keep $130 and have $130 to spend. They cheated the fairtax system $30.

But, if they turn around and spend that $130, currently none of that goes to the feds. Under the Fair Tax, 23% of that, or $29.90 goes to the feds. They now get taxed.

[Always Right]

But, if they turn around and spend that $130, currently none of that goes to the feds.

It works the same way as it does today. When the crook spends money in the legal economy, that money flows through and pays the embedded taxes. Until the fair tax figures out a way to collect on the services of the prositute, then they are still cheating the system. The tax base for the fairtax does not include the illegal economy. It does not add to or subtract from the tax base, just like today.

[pfony1]

I gather you "think" that when a prostitute buys drugs, the drug dealer will collect the "fair tax" and send that money to the government.

LOL!