The only problem with the Fair Tax system: if you get a tremendous amount of exemptions when current tax laws.
I’ll give you my example: I would have (via the FT calculator, itself—I took the test) $815 LESS purchasing power, with 2.40% LESS spending income, and I would have $586 MORE in federal taxes.
I’d think that you probably missed some of these and instead included the funds in your taxable income (the part spent for taxable consumption).
Among the things not taxed under the FairTax are:
1) annual amount paid out for loan payments, including both principal and interest. (include existing mortgage, auto, and all other loan payments.)
2) annual tuition payments made for education for any age, any level. Include annual student loan payments
3) annual amount of all funds deposited to any savings account or retirement account through a government plan, through your employer, or privately, and all funds used to purchase any stocks, bonds, business, or investment vehicle of any kind.
4) annual amount of all funds you have donated to any Church, profit or non profit charity or organization, or given to any individual through a gift, inheritance, donation, or court order, including child support.
5) estimated annual amount of all taxes paid to any State, County, City, Municipal, Township, and other local governments. Include state income and sales taxes, property taxes, school district taxes, deed transfer taxes, occupational taxes. Include both State and Local taxes paid throughout the year, through payroll deductions and estimate those paid on your own, such as sales taxes.
6) annual estimate of funds spent on purchases of used items (jewelry, clothes, used real estate, used cars, used furniture, antiques, etc.).
7) donations as a political contribution to an individual or political party
Actually, I may have left a few things out, but if you’re being honest with yourself I suspect you’d admit that you missed a few things in the above list - all of which go to reduce your taxable income (and thereby lower your effective tax rate under the FairTax).
Also, don’t forget the offset caused by the prebate as well as the increased purchasing power which - per the “anti” forces is 9% or more.
Perhaps you should revisit your assessment. Here’s a good calculator to use: