That's when the revenue is captured. Unlike the situation now.
It doesn't matter what the drug dealer buys. Yes, I will argue that if the drug dealer buys a fancy car, that a flat tax, VAT or even the current income tax will capture that transaction.
The VAT would. But no income tax will, flat or otherwise.
I would agree that both the FairTax or a VAT would capture it, but I don't know how the FlatTax would.