Under the fair tax the lawyer still makes his 90K and the drug dealer still makes 3.2 mil but, the lawyer buys a new BMW for 50K and pays $11,500 in taxes. However, the drug dealer (this one just happens to live in West Palm Beach) buys a new yacht that cost $500,000 and has a sales tax of $115,000.
According to Boortz, a $10,000 car would still cost $10,000 with the fair tax added and hidden tax removed (interview with Sean Hannity).
What's to prevent the drug dealer from buying his yacht outside the US? Or the lawyer from buying a slightly used BMW; lots of them available around here along with SUVs (a Honda would be more difficult to find).
Just to clarify. this poster is talking about a $38,500 pre-tax BWM with $11,500 FairTax added to bring the total price to $50,000 in case anyone is confused.
Under the FairTax, the BMW that costs $50,000 now would have at most 8% removed from its cost to bring the pre-tax price down to $46,000, and then the FairTax (@29.87%) brings the total price to $59,740.
If an accurate higher FairTax rate is used, the car will be over $65,000. This is the same car that would be $50,000 now. And yes, you will need to finance the new higher amount.
Only possible if wages are decreased to current take-home levels.
Boortz is neither the author or a cosponsor of either FairTax bill.
That's another great thing about the FairTax. It's voluntary!
With the income tax system, the gubmint is stealing 30% right off the top from every paycheck and there ain't a damn thing that you can do about it.
But under the FairTax, if you don't want to pay any taxes, don't buy anything.