One of the authors of the FairTax bill tells it like it is ...Well he sure contradicts everything you guys are selling about employer paid FICA for price reductions and not going to the "100% paycheck"
.Dan R. Mastromarco and David R. Burton respond to a recent viewpoint claiming that a national retail sales tax would be detrimental to the real estate industry.
[26] If the $47,129 of our family's income was all wage income, then that couple would have paid $3,605 in employee payroll taxes on those wages. Note also that their wages were also about $3,605 lower because of the employer payroll tax. As noted earlier, economists generally believe that the employer share of the payroll tax is borne by the employee in the form of lower wages. After the standard deduction, the couple would pay income taxes of $6,433, most of which would be in the 15 percent rate bracket, but some of which would be in the 28 percent rate bracket. /5/ Hence, using a standard deduction, the couple would have paid $10,038 of taxes on $47,129, leaving our family $37,091 after taxes. Of that disposable income, 4.3 percent is $1,595....---
[28] Under the AFT Fair Tax plan, their disposable income will increase to $50,734 because of the repeal of all payroll and income taxes.
You've stubbed you toe again since the $50,734 does not include the ER portion - only the EE portion. The $47,129 was their takehome pay.
Your own post even noted that it would have been $3,605 higher with the ER portion - which it didn't have.
Try something else - this didn't work (either).
Your reading of thie is exactl right, the wage income was $47,129. And the employer is paying $3,605 employer half of FICA on top of that, for a total wage cost to the employer of $50,734.
The takehome pay would be the 47,129 less $3,605 employee half FICA less $6,433 withheld income tax for a total annual "take-home paycheck" of $37,091 just like you posted.
You are right that if gross salaries were raised to include the Employer half of FICA as part of the "100% paycheck" promise as the author states, then there would be almost no cost savings to business due to the enactment of the FairTax, so prices would go up by almost the full amount of the 30% tax.
Pigdog, as usual, is incorrect.