[OHelix]

A receipt would read:

$100 item
$29.87 tax
$129.87 total

29.87 is 23% of 129.87

If you earned 129.87 and 23% income tax was levied on it, you would have $100 after tax. Thus a 29.87% sales tax is the same as a 23% income tax. One is the inclusinve rate, the other is exclusive rate, but they are the same amount.

To compare it to most state sales taxes, you would use the 29.87% rate. To compare it to Federal income and payroll taxes, you would use the 23% rate.

[jonestown]

Exactly.
In plain english, the Fair Tax rate would be 29.86% .. And be printed as such on a sales receipt. Correct?

[I doubt that the proposal would ever be accepted in that form, but whatever]