Again, the national sales tax would replace the tax burden already embedded in the product. The price out the door would not change.
Under the current system, if you buy a wooden chair, the person that sells the wood includes what he pays in taxes in the price of the wood when he sells it to the mill. The mill includes what it pays in taxes in the price of the wood when he sells it to the manufacturer. The manufacturer includes what he pays in taxes when he sells it to the store. The store includes what it pays in taxes in the price for the chair. So the price of the chair includes roughly 20% in taxes. Under Cain’s plan, the amount of taxes embedded in each stage drops by 9%. The 9% gets added on at the point of sale and the out the door price does not change. The total price plus sales tax will be what you were paying before.
You pay income tax right now. Where do you get the money? From your employer. Where does your employer get the money? From the customer. It doesn’t change under Cain’s system except that money is collected at the point of sale instead of passing through your hands.
Under the current system, if you buy a wooden chair, the person that sells the wood includes what he pays in taxes in the price of the wood when he sells it to the mill. The mill includes what it pays in taxes in the price of the wood when he sells it to the manufacturer. The manufacturer includes what he pays in taxes when he sells it to the store. The store includes what it pays in taxes in the price for the chair. So the price of the chair includes roughly 20% in taxes.Whew! It's a good thing there aren't more people involved in the production/sale of that chair or it would exceed 100% tax.