Thanks all for the replies.
There ain't no free lunches. I think the majority of fair tax supporters think they are going to be better off, but I don't see it.
I've dealt both with IRS and our state's tax agency, and I'll take IRS any day. The thought of sending all tax compliance burden to the states is a chilling thought to me.
I also don't see a way around the black market.
I think I've done a decent job of showing that the initial economic impact will be pretty much a wash (purchasing power remaining roughly constant). But I do think that the improved economic growth will make the FairTax better economically in the long run.
The more important aspect is personal freedom -- individuals not having to report their personal finances to the government. Having first claim on your own production. And so on. No form of income tax, flat, progressive, or otherwise, can come close to that same form of freedom.
I also don't see a way around the black market.
All forms of taxes have people evading them. Instead of a labor black market, they'll be a goods black market. The net effect is, again, pretty much a wash. Most people are honest, and the bulk of retail purchases are done at large retailers (and for black marketeering, if the seller isn't playing along, there's no black market happening).
True. I think the FairTax will be a big improvement over the status quo. OTOH, that doesn't mean there are other reform plans that are equally as good if not better.
What sort of "black market", specifically, do you envision?? How exactly would it work? What would be gained by the differect parties?
Have you compared the size of such a "black market" to the illegal economy (drug dealerss, illegal aliens, etc.) presently which evades taxes and makes no contribution to tax revenues when they will be taxed under the FairTax. Do your think any "black market" under the FairTax would be larger that this existing illegal economy (which is the equivalent of the "black market" right now)? On what do you base your information?
"I've dealt both with IRS and our state's tax agency, and I'll take IRS any day."
I have been through income tax audits and sales tax audits and sales tax audits are trivial compared to income tax audits. In addition, individuals will no longer be subject to audits, only busineses, The number of points of enforcement/compliance will be dramatically cut.