Your list of those "hurt" by the Fair Tax is bogus.
The average worker will IMMEDIATELY see his paycheck jump by 25% or more (think gross pay instead of net pay). The sales tax on the first $25,000 of it will be rebated monthly so that low income folks are not hurt by it.
Businesses and industries who are thinking of moving (or who recently moved) to other countries to take advantage of lower taxes and wages will now reconsider and MANY of them will crunch the numbers and realize that financially it no longer makes sense to move to Mexico or Indonesia.
Giving to charaties for the deduction it would bring is stupid. Why would I want to give $1000 to a charity just so I could reduce my taxes by $280? Charities existed before the income tax and will exist after.
As for tax exempt organizations being in the "losers" column, I see it as a gain. No longer do they have to kowtow, shut their mouths, and kiss the ass of the IRS for fear of losing their tax exempt status. One of the most horrible pieces of unconstitutional legislation ever passed was the one that threatened the tax exempt status of the churches if they DARED to be involved in politics as they had been since our country began.
From the book, pg. 165: "With taxes at the 39 percent level, why would they spend $1000 to save $390?"
Saving $390 (or my marginal income tax rate amount) reduces the impact of my giving the $1000. It sure affects my thinking when I write out a check to a charity. And Boortz pooh-poohs this? It must affect others as well.
Regarding currently tax-exempt organizations:
I mentioned that their comparative advantage is reduced.
This has been shown to be FALSE. The FairTax study assumed that wages would be reduced to current take-home pay levels in order to remove the embedded tax costs from the pricing in products. See these threads for the whole story:
| JORGENSON EXPLODES FAIRTAX MYTH (FR Exclusive) |
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| Posted by RobFromGa On News/Activism 08/25/2005 12:40:44 AM EDT · 701 replies · 7,599+ views |
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| MONEY finds flaw in 'FairTax' bestseller [FairTax myth busted by major magazine] |
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| Posted by Your Nightmare On News/Activism 09/08/2005 7:48:28 AM EDT · 238 replies · 2,830+ views |
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"One of the most horrible pieces of unconstitutional legislation ever passed was the one that threatened the tax exempt status of the churches if they DARED to be involved in politics as they had been since our country began."
Great point. I still don't understand how African-American churches can use the pulpit for political purposes all they want, but other churches can't.
I would give $1000 to a charity because I want that charity to have $1000. The fact that I am really only giving $720 and the gubment is giving $280 is just an added bonus! {;o)