[RobFromGa]

Of course that is true, but the economics for Bob's bakery and Jack's Bakery are the same, and if the price of bread with a 30% tax on it is higher than people are willing to pay, then one or both bakeries go out of business.

[Tribune7]

Of course that is true, but the economics for Bob's bakery and Jack's Bakery are the same, and if the price of bread with a 30% tax on it is higher than people are willing to pay, then one or both bakeries go out of business.

Only if people no longer need bread. They are going to have more money to spend.

If the FairTax is revenue neutral the same amount of money will flow into D.C. as before. I think it's safe to say prices will rise. OTOH, I think there will be more overall consumer spending power due to the efficieny in compliance.