That is not the point. The point is how does the employer realize the $1.3 Trillion worth savings from the taxes the employee now pays. Without the employer seeing those savings, the employer can not significantly reduce his prices.
Like I said, I don't know about this particuar plan. If they are saying that the business owner gets a windfall of 20% because he doesn't have to withold taxes, then that is just silly. However, there certainly WOULD BE savings if we went to a tax system where I am not forced to be the collection agent for the fed, as a small business owner.
Why do you persist in trying to make the spurious argument that the only costs imposed by the income tax system are the taxes themselves when you KNOW that to be untrue?
"All goods and services produced in the United States already contain the embedded costs of the current tax system in their prices." is a far cry from embedded taxes only!