"Not true. If you bought a house jus before the FairTax and paid $250K for it, and your friend bought one across the street after the FairTax was implemented, he woul pay about $250K after tax. EIther house would sell for about the same several years later, probably $250K + appreciation."
You're missing the point.
If I buy a house today for $250,000. And someone buys an Identical house after the fair tax he will pay $250,000 including the tax.
Then I have to move, so I sell my house. I receive $250,000 minus the federal tax for a net amount of $192,500 and not only lose all my equity, I can't even pay off my mortgage.
Or will the federal government only tax new construction, and real estate won't be taxed again when sold after the first time?
Or will the federal government only tax new construction, and real estate won't be taxed again when sold after the first time?
Tax once but only once is the explicit rule in the legislation.
Used = Tax already paid or property grandfathered as already held for otherthan business purpose, by explicit definition of the term used property in the bill.
Read it. It is enlightening, then ask the questions.
mash yer clicker here ==> H.R.25, S.1493
A bill to promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national retail sales tax to be administered primarily by the States.
For additional information: http://www.fairtax.org, http://www.salestax.org & http://www.geocities.com/cmcofer/ftax.html
"Then I have to move, so I sell my house. I receive $250,000 minus the federal tax for a net amount of $192,500 and not only lose all my equity, I can't even pay off my mortgage.
Or will the federal government only tax new construction, and real estate won't be taxed again when sold after the first time?"
Everything is taxed once and only once. Used goods are not taxed - real estate or otherwise. You would be crazy to sell your house for $192.5K.
-- Like all goods and services, USED homes will not be taxed. The Market Value of your home would be (assuming that your two homes are itendical) is $250,000 plus the FairTax (making it $324,675). You would make out like a bandit.
It's funny, because some arguments AGAINST the FairTax is that used home prices will go far too high and crowd out new construction.