earning on savings are taxed.
Correct. Taxing earnings on savings decreases compound growth. The FairTax doesn't tax earnings and thus increases compound growth.
Just because she has to pay sales tax when she buys goods is no different than today, as embedded taxes are included in legal purchases today.
They will not be paying the compliance cast that they are today.
You are not gaining a dime from the illegal economy,
Wrong! You are not always right -- neither conservative nor correct. If the illegal economy remains static the economy gains from not paying $400,000,000 (four hundred billion) compliance cost. That waste of 400 billion dollars is lost opportunity regained. Speaking of economic opportunity. Rep. Bill Archer, Chairman, House Ways and Means Committee:
"A recent survey was done, in Europe and Japan, of the major corporations and I was astounded at the results. They were asked, 'If the US abolished its income tax and went to a sales tax, would that have any impact on your decisions?' Eighty percent of the corporations said they would build their factories in the United States of America. Twenty percent said they would move their international headquarters to the United States of America."
Boatloads of new jobs and economic boom. With the increased tax base and economic growth -- increased retail sales = increased tax revenues -- will continue the momentum to reduce the FairTax rate. Every person feeling the effect of how much government really cost them at the cash register -- seeing that 23% of their purchase is federal tax --will have them quick to demand government reduce spending.
That is really frightening. If this "fair tax" scam depends on such a pipe dream, it is already dead because it would necessitate a police state of unprecedented immensity and the destruction of our republic.
Odd, you claim I am 'wrong' but you do not dispute the point. The point was concerning the illegal economy, not compliance costs. I will concede there will be some compliance costs savings, much closer to $100 billion than $400 billion though. That is one significant advantage along with making our exports cheaper as another significant advantage. There are some attractive features to the sales tax, but it is rarely sold that way. The fairtax is usually marketed as a free-ride/everyone wins plan, which is bs. If you think you must spin the truth to be a conservative, than I suppose by your definition I am not. I personally hate the fairtax because it will be devastating to the new housing industry, which is my livelihood.