I don’t think you can just add your state tax and a NST and say that’s going to be your tax burden.
Several other things about your financial situation will change.
For example, if you are employed, you are now paying payroll (”Social Security”) tax, sometimes listed on your pay stub as FICA.
That is around 7%, although presently it’s temporarily lower as part of a “stimulus” program. (BTW, ironic isn’t it, that even President Obama agrees that lowering the payroll tax helps the real economy. I guess Cain’s idea on this point isn’t so looney after all, eh? :O )
Under 999, that payroll tax is eliminated. You would no longer pay that 7% (just using a round number). Now remember that was 7% on every dime you earned, whereas the NST would be on every purchase you *decided* to make.
I think if you do your numbers, you’ll find that getting 7% more of your pay compared to paying 9% on your consumer purchases (which are majority discretionary) works out well for you.
And that doesn’t factor in that lower corporate tax rates under 999 would free up corporations to drive sales through lower prices if they wish or are “forced” into it by competition.
The black market has nothing to do with your payroll taxes. The black market is about when something becomes financially viable for cheating.
What I have read is that as a sales tax approaches 20% that it becomes worth the risk of cheating to find black market means to avoid that tax.
So, rather than pay $240 bucks to get your brakes done at the shop, you have the mechanic visit your house after hours for a cash transaction of $200 or less. You just saved 40 bucks.
You have a shop owner that begins getting shelf supplies through other than kosher distribution, and to those he’s comfortable with, he gives them $240 worth of purchases for $210, pocketing both his profit and $10 extra for helping you avoid the tax.
I’m sure there are more lucrative examples than I’ve shown. If a $200,000 house would end up being $240,000 bucks, then 40,000 in tax is paid. Playing with the price of the house between buyer and seller on the sly could make thousands of dollars worth of difference.