But you fail to include state income taxes. If states drop the income tax and piggyback off the NRST, then the state exclusive sales tax rates would have to be closer to the 5-7% level. Otherwise we are still stuck reporting income to the state.That's a good point. Currently, according to the NIPA tables, revenues from state and local sales and income taxes are equal to 1/3 of federal revenues. If the states were to drop the income tax and pick up the FairTax base for their sales tax, they would have to go with a rate of ~10%. Which would be ~40% when added to the FairTax rate.
Wrong. As I've pointed out several times with the reuisite reasoning, the conforming state sales tax would decline. In a state such as CA where in places thera is a 7.75% (note the 2 decimal places) t-e rate, the FairTax conforming rate would drop toi something like 2% to 3%.
And just like the effect of the FairTax oveall, the increase in economic activity brought about would bring in more state revenue even at the lower rate.