The rebate and an exemption schedule are equivalent in intended effect, i.e. to avoid taxing the essentials of life. A rebate is a more effective approach than exemptions, since the rebate:
It occurs to me someone should mention the basic premise of the FairTax. The current income and payroll tax system is perverse, unfair, incorrect, indefensible, incompatible with a healthy economy, dangerous to our future as a nation and basically un-fixable. Every time we meddle with income tax to fix some problem, we create new opportunities for influence-peddling and indulgences, taking a step closer to bureaucratic despotism and the dissolution of freedom. Or the chaos of revolution - after all, you don't think folks will stand for this forever, do ya? As long as there is a direct tax on individuals someone will desire to wield it as an instrument of power and influence. And we'll never get the issue of spending for power and influence.
But we can't just throw the whole thing out without causing tremendous upheaval and destroying the country. That's the status quo the spenders and looters would prefer, to prevent us interfering with their power. The FairTax is the answer to the challenge. Replace the payroll and income taxes with the FairTax and the relationship between spending and taxation becomes crystal clear. The tremendous influence of the government over social policy, which has always been misused, is now diminished to let us live freely again.
So, I view the FairTax as kind of a litmus test. Are you going to be part of the problem or part of the solution?