I finally could see that if an employer would give all an employee's withholding back to him he could not simultaneously deduct that amount from his prices. However, there is still a 7.65% FICA that the employer pays to the government. He does not withhold it from his employee and has no obligation to give it to him. That must be recovered in his selling price.
Would you agree with that?
He does not withhold it from his employee and has no obligation to give it to him.Where, except at AFFT is that written?
That must be recovered in his selling price.No. The employer half is paid on behalf of the employee. The Fairtax rate is calculated to replace the employer half to be paid by the employee in sales taxes. The employer would not be paying sales taxes, the employee would.Would you agree with that?
If the employee doesn't recover the employer half it would be a windfall to the employer at the employee's expense. Retail prices could only be reduced on domestic produced goods...that's not very much if any.
`(d) OLD-AGE, SURVIVORS AND DISABILITY INSURANCE RATE- The old-age, survivors and disability insurance rate shall be determined by the Social Security Administration. The old-age, survivors and disability insurance rate shall be that sales tax rate which is necessary to raise the same amount of revenue that would have been raised by imposing a 12.4 percent tax on the Social Security wage base (including self-employment income) as determined in accordance with chapter 21 of the Internal Revenue Code most recently in effect prior to the enactment of this Act. The rate shall be determined using actuarially sound methodology and announced at least 6 months prior to the beginning of the Calendar year for which it applies.Add it up. That puts the entire 15.3% burden on the employee/consumer.`(e) HOSPITAL INSURANCE RATE- The hospital insurance rate shall be determined by the Social Security Administration. The hospital insurance rate shall be that sales tax rate which is necessary to raise the same amount of revenue that would have been raised by imposing a 2.9 percent tax on the Medicare wage base (including self-employment income) as determined in accordance with chapter 21 of the Internal Revenue Code most recently in effect prior to the enactment of this Act. The rate shall be determined using actuarially sound methodology and announced at least 6 months prior to the beginning of the calendar year for which it applies.