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I really do want to understand and I am almost finished the Booortz/Linder book. I would like to get behind this and push it but if I can't understand it in a fairly simple way, then I have no chance of selling it to others.

As an example, I am able to explain supply side economics by explaining that tax payments are a brake on the economy and that reducing effective tax rates causes the economy to grow increasing overall revenue.

But the FairTax people are not counting on a larger economy to generate the revenue from what I have read, and from what I am reading. They are using a static model.

Let me try to restate what I don't understand.

As an upper middle class taxpayer right now I pay a substantial amount to the IRS in the form of income tax, plus I pay $X for all goods and services I buy. These prices are estimated to have a hidden premium of 20-25% in order to compensate for the tax related costs.

Under that Fair Tax as an upper middle class taxpayer, I will no longer pay any income tax to the IRS, and neither will any one else. This lack of taxes in the cost of goods and services, will result in a reduction in the price of those goods and services of about 20-25%. Under the Fair Tax, I will pay the same amount for all my goods and services in the end when the government collects the 23% Fair Tax.

The 23% the government collects will replace the money that they had been collecting in taxes embedded in the product. So where does the government collect the money to replace what I am presently paying in income tax?