But if the States are still able to tax you on your income the same as now, then the 23% is added on top of the State income and sales tax.States predicate their income taxes on Federal income tax data. Once the federal income tax is gone, it is highly unlikely that individual states will be willing to implement the necessary infrastructure that would allow them to keep their income tax. A FAR more likely outcome would be that states would conform their sales tax base to the new federal sales tax base and raise the same amount of money they currently do with the sales tax alone and with a much lower overall tax rate.
Please see The FairTax: What’s in it for the states?
“A FAR more likely outcome would be that states would conform their sales tax base to the new federal sales tax base and raise the same amount of money they currently do with the sales tax alone and with a much lower overall tax rate.”
Ok. Thanks.
But wouldn’t that be predicated on the States actually abolishing the income tax, and not just keeping it as is?
Living in New York State, and considering who (whom?) we have running the government here, I wouldn’t be too sure they wouldn’t do both.