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Actually it's not a matter of preference whether to use the inclusive or exclusive tax rate for a sales tax. Using an inclusive rate for a sales tax is just wrong. Just like using an exclusive rate for income tax would be wrong.

Because an income tax is subtractive, if you change one of the tax rates being applied, the other taxes still collect the same tax because the amount being taxed (gross income) doesn't change. So if a person has $50,000 income, adjusting the income tax rate or the payroll tax rate does not change the fact that those taxes are being applied to $50,000. The inclusive rate is natural and correct for a subtractive tax like the income tax.

A sales tax is additive, if you change one of the tax rates being applied, the other taxes collect more or less tax because the amount being tax (gross payment) has changed. The inclusive rate is unnatural and incorrect for a additive tax like the sales tax.

Example:

Tax Inclusive General Revenue Rate
14.91%

Combined OASDI & Medicare Rates
8.09%

Total Rate
23.00%

Gross Payment on $1000 item
$1,298.70

Amount going to General Revenue
(14.91% x $1,298.70)
$193.65

Effective Tax Exclusive General Revenue Rate
19.37%

Now with an increase in the combined OASDI & Medicare rates (the ones set by the SSA) and keeping the statutory 14.91% general revenue rate.

Tax Inclusive General Revenue Rate
14.91%

Combined OASDI & Medicare Rates
10.09%

Total Rate
25.00%

Gross Payment on $1000 item
$1,333.33

Amount going to General Revenue
(14.91% x $1,333.33)
$198.80

Effective Tax Exclusive General Revenue Rate
19.88%

So you have a general revenue tax increase without changing the rate. I really don't see how this situation is tenable.

This clearly illustrates that exclusive rate is the only correct rate to use for a sales tax. If you want to compare the tax exclusive sales tax rate to the tax inclusive income tax rate, the conversion is very simple.

Now a lot of the FairTax supporters have become very dogmatic about the inclusive rate and y'all will be inclined to go into attack mode. Instead I would suggest you take a close look at what's going on in this illustration and ask if having a rate that has a slight relation to the current system that y'all want to abandon and have forgotten worth the effect shown here. I haven't seen this effect shown anywhere previously (it may have been, but I haven't seen it) so I'm guessing most of you weren't aware of it.

Changing to the exclusive rate doesn't change any of the fundamentals that y'all believe make the FairTax such a great idea, but it's obvious that the way the rate is expressed will have to be changed before this becomes law. The sooner the better for your cause.

ask if having a rate that has a slight relation to the current system that y'all want to abandon

They may want to, or claim to want to abandon it, but suspiciously, you won't find bigger defenders of the income tax either.

Everything you said is meaningless if you addressed my other reason for quoting it inclusively: how it will be collected:

On the retailer side it will be 23% as well. In it's simplest terms, the NRST will tax 23% of a retailers TOTAL SALES. Make $10,000 in sales this month? Remit $2,300 to the government. Retailers charge whatever the hell they want to make up for the tax burden. State and local sales taxes can be taxes this way too; their rates would have to slightly adjust. Most states are going to modify their tax system to accommodate the new federal system anyway.

In fact, it will make tax collection streamlined to the point where it's painless.

OK, you're Bill the Retailer. The Feds say they want 23% of your sales, the State wants 3%, and the City/County want 1.5%. You (Bill the Retailer) then raises his prices enough to cover these costs. 27.5% of your sales get remitted instantly from the register.

Quick. Simple. Easy.

As for the receipt printed off, it looks like this:

Sticker price: $100
23% FED: $23
3% STATE: $3
1.5% CITY: $1.50

Total Taxes: $27.50

Item X: $72.50

Total Paid: $100

Customers are STILL reminded every time they buy something how much of that item was taxes.

It's not hard to use subtraction instead of addition.

It may be easier to think about it as a "Single-Layer VAT".

-- Remember, our $100 sticker price is merely the hypothetical final price after the retailer raises his prices to compensate for the tax burden. If Bill the Retailer needed to raise prices to $110 instead, then there would be a $110 sticker price.