You are right. What they don't tell you is if the we keep the present system the government intends to give back to us all that money we have already paid in taxes. (Just like God is going to give back my days of youth.) Point being, what is gone is gone. Why impede progress moaning over past mistreatment?
Add to Forbes 17% Flat Tax the 15% SS and Medicare tax withholding, which it keeps but the Fair Tax doesn't, and you get a lovely 32% without all the ancillary benefits of the Fair Tax.
You are almost correct - Flat Tax
17% + 7.65% = 24.65 for individuals 32.30 for self-employed
You need to add -
Corporations will pay the same 24.65 but since they pass those costs onto the consumer (that's us) we will be paying 49.30. We all tend to forget we are paying their taxes already. In fact I would say most of the country doesn't realize we pay the corporate taxes.
32% on wage income. A retired person lives on dividend, interest, capital gains, and withdrawals from savings and investments (already taxed in many cases).
To be revenue neutral, the "Fair Tax" would have to replace the revenue obtained from individual income taxes, a large portion of the total revenue obtained by the federal government, so the tax price of products would be plus up'ed significantly more than the "hidden" taxes that corporations pay in income taxes, and they also have lots of income tax dodges. So of course the retired individual would be double paying taxes on savings as it was withdrawn. The income earner would gain, as their income would not be taxed at the federal level. This is good only for those who are earning wage income, or inheriting money. Those who have saved are screwed by this "fair tax".