“Yes it would but you must realize the expense that would now be involved for individual states to maintain their income tax systems without being able to rely on the federal system for the necessary data.”
Would this also eliminate states ‘borrowing’ from the Federal government to increase their budgets?
If it did, then I would be all for it because, according to what has been explained, they would have a ‘set’ amount that they would receive and would have to live within their budget amounts.
The FairTax proposal is for FEDERAL tax reform and thus makes no attempt to dictate what individual states can or should do. Having said that, there are certain practical matters - such as those I have already mentioned - that states which currently have an income tax would have to deal with when the Fairtax becomes the law of the land.