[gitmogrunt]

23% National Sales Tax = 100% Black Market Purchases to avoid the 23% Tax.

[SAJ]

Absolutely correct, except that the effective 'fair' tax rate is 29.87%, not 23%.

When Nixon put on those idiotic wage-price controls in 1971, I recall doing very nicely by purchasing goods (chemicals in this case) for companies that didn't buy enough in the infamous 'baseline' period, and so thereafter couldn't buy enough for their needs after the controls came on.

The 'fair'y-tale tax would create lots of similar opportunities. LOTS. For example, people on the Gulf Coast would be able to profit very nicely by sailing across the Gulf to Mexico, buying a bunch of whatever goods, and selling them outside the 12-mile limit. Or perhaps even bringing the goods ashore and trunk-jobbing them.

[cake_crumb]

Can you imagine what a 23% tax on food and other nacessities would do to our economy?

[MrB]

So... does a 30+% marginal tax rate on income mean that all of those people are currently working under the table for cash?

[Ditto]

23% National Sales Tax = 100% Black Market Purchases to avoid the 23% Tax.

So Wall Mart is going to turn into a "speak easy" to keep the revenuers from getting in? Ford and GM will be selling cars at 3 am in some back alley? Amazon.com is going to switch to selling for cash out of the back of UPS trucks?

Just how does this blackmarket operate?

Also keep this in mind. If it weren't for the insanity of the income tax code, Enron, WorldCom and the other fast operators could have never hoodwinked the investment community the way they did with their Byzantine financial statements. Get rid of the IRS and get rid of the myth that corporations actually pay rather than collect taxes, and tax fraud will go way down.

[Turret Gunner A20]

23% National Sales Tax = 100% Black Market Purchases to avoid the 23% Tax.

That is laughable. Thanks for the chuckle of the day.

[ReignOfError]

23% National Sales Tax = 100% Black Market Purchases to avoid the 23% Tax.

BS. Is there rampant moonshining and cigarette smuggling? Sure, it goes on, but the vast majority of liquor and cigarette sales are through licensed premises, and the taxes are paid.

And even if the black market grows, it's still a a molehill next to the mountain that is the income-tax industry -- paper games, off-shore corporations, shady investments, workers paid under the table, all to avoid paying tax. Yes, under the Fair Tax, some folks will fail to collect taxes on the goods and services they sell. The same folks who aren't filing their W2s and 1099s today.

I wouldn't expect an explosive growth in dishwasher smuggling.