Both start withdrawing and spending their money under "fair tax" system. The former would be paying consumption tax, but that would be instead of the previously deferred income tax he has not paid to get his 401k. The double taxation issue concerns the latter: he will be hit with the consumption tax on top of the income taxes he has already paid to put that same 100K into his Roth or in the saving account. Thus, unless there are specific compensatory provisions, like up-indexing of all after-tax accounts, it is a double taxation fraud.
Investors will not be double taxed. The Fair Tax will abolish the income and captial gains taxes
Fair Tax FAQ #2 I suggest you visit and read the
Fair Tax website before you make anymore statements about the Fair Tax.
Maybe it is you who should read more closely, and then think on what you've been reading? Capital gains are currently taxable at 15%, capital cost basis at 0% [already taxed] - and you would like to tax them both at 23%. My point was - exclusively - the double taxation, in this particular case of the capital cost basis.