You claim you will have to charge your customers 30% more than current prices. That is dependent on what taxes you currently pay and what your current costs are -- because both of those will decrease under the FairTax.
How can you possibly say they are irrelevent and expect anybody to take you seriously ?
Of course I could provide numbers for you, because you've obviously not even done your own numbers. You are just making blanket generalizations.
Here are your numbers. You refused to provide numbers, so don't complain about these.
Under Income & Payroll Tax
Actually there is a case where lewislynn may actually have to up his prices by 30%.
The key lay in the validity of an assumption involving any specific business actually paying a tax under the income/payroll tax system or for that matter having any costs related to it.
There is a whole cash sector of the economy that has no declared incomes or payrolls on which taxes are paid or for that matter even an accounting kept in order to comply with the current system.
To assume all businesses actually pay taxes or even have tax compliance costs under the income/payroll tax system is clearly be in error by IRS statistics. For it is clear many individual, small businesses actually manage to incur neither according to the IRS's investigations into the matter.
The cash sector is one of many reasons there exists a very large discrepency between what theoretically would be collected as tax revenues by the government and what it actually collects.
Oh and as to "errors":
Your take home pay was increased by 20% per Rob's assumptions
I missed that Rob assumptionBUSINESS COSTS: If we assume that businesses get to keep their half of the payroll taxes (7.65% of all payroll costs up to first $95k per employee), plus taxes on corporate profits (average <2% of Cost of Goods sold) and some tax compliance savings (being generous we'll call this 1% savings), this gives the business about 8% of cost savings with which to potentially reduce prices.
I told you I don't have "wage costs" and I also don't want the FCA. Sorry no savings there.
Using your numbers:
My take home under the income tax was $216,000 AFTER TAXES... My take home under your scam is $257,000 BEFORE taxes or $198,000 AFTER TAXES or .
Under your two scenarios $84,000 (14% of the gross) was collected from my business activity under the income tax...Under the sales tax $158,000 PLUS another $59,000 (when I spend my money) or a total of $355,890...OR 52% of the even higher gross was collected.
So, using your numbers including the HUGE 20% increase "error" my net takehome as well as lower "non-wage costs" was an even smaller percenatge of a 14% increase in prices
Bottom line is your entire assumption is either a gross mistake or a pathetic lie...you can't even make the numbers work when you make them up yourself...Here are your numbers. You refused to provide numbers, so don't complain about these.
Those are NOT my numbers. Don't blame me for your idiocy because I chose to not furnish you with my personal financial information on a public forum.
Under Income & Payroll Tax
Under FairTax
Increase in prices: $131K / $600K = 21.8%
Purchasing Power delta: (288/216)/(1.2) = 1.1
Note, purchasing power for this individual rose 10% because he was an extraordinarily high income earner (> 96% of all earners.) He may (or may not) choose to lower prices more depending on his competitive pressures and business needs.
Interestingly enough, if this businessman DOES lower his prices further, he is eroding the value of the tax base needed to raise the required revenue: prices lowered by MORE than the saved tax cost = smaller FairTax base = less FairTax collected => Higher rate = higher prices. Either way, the customer is going to pay the 20% price increase.
If this businessman was of more modest means, his prices would still increase about 20%, but his take-home would have not risen as much:
Under Income & Payroll Tax
Under FairTax
Increase in prices: $73K / $381K = 19%
Purchasing Power delta: (73/63)/(1.2) = 0.97
To break even, this businessman would have to increase prices further (another $3K). That would bring his price increase to 20%.
You have incorrectly assumed too much non-wage price reduction, 100% compliance with "net-zero-purchasing-power-delta" target by highly profitable businessman (read that "businessmen in noncompetitive markets") and ignored the net purchasing power decrease of highly competitive (low profit) businessmen.
Yet another example of how anecdotal analysis does not tell the whole story.