But with the flat tax "their taxes" aren't done in two minutes - or at all - by the idealized method you cite. As I said previously there are other taxes such as payroll and withholding taxes which many peoople aren't aware of as well as the taxes embedded in the cost of things we buy at retail.
The Flat Tax is no better at giving a taxpayer a complete picture of his tax burden. In fact if a taxpayer is truly interested in keeping track of it the FairTax offers the best and most complete picture of the true tax burden. If the person doesn't want to retain records (or enter the data into a spreadsheet each week or perhaps each month or so) the total tax burden is probably not of interest to him.
The fact remains that it cannot be obtained correctly with the flat tax.
The Flat Tax is no better at giving a taxpayer a complete picture of his tax burden. In fact if a taxpayer is truly interested in keeping track of it the FairTax offers the best and most complete picture of the true tax burden.What about the federal taxes that would be embedded in their state and local taxes? How are they to keep track of that?
Unfortunately, the only way to correctly calculate the embedded costs in retail prices is if that cost is ZERO.
The only way to accomplish THAT is to give up the fiction that businesses can pay taxes without adding them into their prices.
The only way to accomplish THAT is to remove all taxes -- income, payroll, property, etc. -- from businesses. That would make it clear that all taxes were being paid for by individuals.
The only way to accomplish THAT is to eliminate all income and payroll taxes from individuals. Why ? Because otherwise individuals would soon shift all their income to where it was business income. Businesses would have no employees -- only sub-contractors.
So. To get prices to reflect the true, untaxed, cost of production and profit, we have to eliminate all income and payroll taxes from both business and individuals.
Can anyone say "FairTax" ?