[looscnnn]

And you ignore the fact that the only way prices can drop like that is if wages are reduced. And since wages can't be reduced across the board, price almost certainly won't be going down.

Wrong answer, wages are not the only thing that affect prices. You have the price of doing business ("corporate taxes"), supplies, materials, utilities, transportation, etc. on top of wages. Prices can drop due to reductions in the cost of any/all these items. The fair tax would eliminate the corporate taxes, which would also reduce the cost of all the items due to their corporate taxes, which are embedded into their prices, being eliminated.

They would have to be very poor to approach an 5.4% effective rate under the FairTax....People consuming exactly at the poverty level will have a higher than 0% effective rate. It's closer to 4%.

Not true, the prebate would cover that. Also, if they were shrewed enough in their buying they could actually make money from the prebate by paying less sales taxes than they get in the prebate.

[Your Nightmare]

Wrong answer, wages are not the only thing that affect prices. You have the price of doing business ("corporate taxes"), supplies, materials, utilities, transportation, etc. on top of wages. Prices can drop due to reductions in the cost of any/all these items. The fair tax would eliminate the corporate taxes, which would also reduce the cost of all the items due to their corporate taxes, which are embedded into their prices, being eliminated.

Corporate income taxes are not a "price of doing business." According to your logic, a company that lost money and therefore paid no taxes would have to raise their prices once they started turning a profit and paid corporate income taxes. Prices are set by the market equilibrium, not arbitrarily by the business.

They would have to be very poor to approach an 5.4% effective rate under the FairTax....People consuming exactly at the poverty level will have a higher than 0% effective rate. It's closer to 4%.

Not true, the prebate would cover that. Also, if they were shrewed enough in their buying they could actually make money from the prebate by paying less sales taxes than they get in the prebate.

Actually what I posted is exactly correct. The rebate is calculated by multiplying the poverty level times the inclusive FairTax rate. The FairTax at the poverty level is the poverty level times the exclusive rate.

[lewislynn]

Also, if they were shrewed enough in their buying they could actually make money from the prebate by paying less sales taxes than they get in the prebate.

If that's possible it would mean everyone else is paying more tax through an increased rate than what is actually needed to fund the government. Or does the money come from the magic government money tree?

If the "prebate" is such a good idea for some taxpayers why not increase it so even more people can profit from it?...Why not everyone?