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The cost of imbedded taxes is larger than just the taxes paid -- it includes complaince costs, lost opportunity costs, higher interest costs, and so on, none of which shows up as federal tax revenue, yet still shows up at the cash register.

$2-3 trillion in compliance costs? Try $100 billion.

Lost opportunity costs? This is in prices? And how are you going to add 30%+ to the cost of ever good and service sold at retail without adding dead weight to the economy? Do you really think you've discovered the only tax that doesn't distort the economy?

Interest is a deductible expense for businesses. The after-tax rate would not drop with the FairTax.

Lost opportunity costs? This is in prices?

Take econ 101 sometime.

Yes, this is in prices. Assets that are tied up in useless (unprofitable) holdings to avoid taxes means that the productive assets have to produce more income to compensate for them. That means higher prices to gain higher return on investment.

You free up all of that captial, and you don't need as high of a ROI in order to make using it worthwhile, which means operating on lower profit margins, and less cost to consumers.

Interest is a deductible expense for businesses.

Which only means that they don't pay tax on it. Interest is still additional outlay which goes into ROI calculations.