[The "prebate" would indeed become a massive welfare system.]
Nonsense. If the only way to get a large prebate is to raise the rate, then the only ones that will want a higher rate are the ones that don't aspire to live above poverty.
I don't think it will be tough to sit on the HHS poverty figures.
The vicious circle is that prices would rise on necessities, generating greater revenue, also generating screams of "unfairness" by the "lower 1/3 of wage earners". Demands for their prebate to increase as a percentage of necessities to luxuries based on their income would rise dramatically. Viola! welfare.