Since under the FairTax a taxpayer pays the tax at the time he makes a retail purchase, I'd be interested in complete detail on what you see as the "black market".
Please define and quantify it and provide some links to some definitive studies that characterize it. Just claiming there is one isn't sufficient.
Governments have been around for something like 6,000 years - since the time of the ancient Sumerians and all governments tax in some manner since they themselves intrinsically have no money ... so what???
Since under the FairTax a taxpayer pays the tax at the time he makes a retail purchase, I'd be interested in complete detail on what you see as the "black market". Please define and quantify it and provide some links to some definitive studies that characterize it. Just claiming there is one isn't sufficient.The black economy is made up of two constituent activities: ................1.. Legal activities that are not reported to the tax authorities and the income from which goes untaxed and unreported. For instance: it is not illegal to clean someone's house, to feed people or to drive them. It is, however, illegal to hide the income generated by these activities and not to pay tax on it. In most countries of the world, this is a criminal offence, punishable by years in prison. .......2.. Illegal activities which, needless to say, are also not reported to the state (and, therefore, not taxed). ................These two types of activities together are thought to comprise between 15 percent (USA, Germany) and 60 percent (Russia) of the economic activity of a country (as measured by its GDP).
Right now, employers take out taxes before the employee gets his hands on the money. The employer will not risk losing his business for the economic benefit of one of his workers.
With a 23% Federal sales tax, each buyer will have to decide if it is better to buy goods and services "retail" or "under the table" for a 17% savings after the illegal seller gets his 5% cut for selling "under the table".
Governments have been around for something like 6,000 years - since the time of the ancient Sumerians and all governments tax in some manner since they themselves intrinsically have no money ... so what???
Exactly. And for all those years, governments have been battling black market tax evasion. Income taxes, and therefore income tax evasion, is, historically, a recent invention.
If you think that the disappearance of the Income Tax means the disappearance of the Tax Police, you will be in for quite a shock.
The Tax Police hold a news conference in Moscow. Igor Tabakov, photographer.