This is not true. The resulting increase in the money supply will decrease the value of savings at transition by the tax rate. That is, if you have $20,000 in savings, it will by 23% less after the creation of the so-called "Fair Tax".
it will buy 23% less
in the long run, compounding savings will allow one to consume much more...
"This is not true. The resulting increase in the money supply will decrease the value of savings at transition by the tax rate. That is, if you have $20,000 in savings, it will by 23% less after the creation of the so-called "Fair Tax"."
Theoretically, this balances itself out rapidly. This is one of the points I am not yet completely convinced. However, the logic does say competitive capitolism will drive the correction to about pre-tax pricing. What may devalue the dollar (inflation) could be the additional spending that Amercans can afford especially if international businesses start setting up shops and factories and there becomes a shortage of workers, which drives salaries, which drives demand, which drives costs.....
There are worse things the country's economy could do.
This is not true. The resulting increase in the money supply will decrease the value of savings at transition by the tax rate. That is, if you have $20,000 in savings, it will by 23% less after the creation of the so-called "Fair Tax".
You also have to consider age.
I have recently entered my 50's and, for my entire working life, I have followed the frugal "Millionaire Next Door" lifestyle while getting socked with income taxes.
Now, after I retire in the next 10 to 15 years, the Fair Tax Plan then taxes the spending of my savings.
So, in the end, I get %$#&ed during the years I earned and saved my money and then I get %$#&ed again during the years I spend my savings.
If the Fair Tax gets passed, I want an "Already Paid My Taxes on This Money" clause.