Will the 23% national tax apply to the purchase of gasoline?
The base price of gasoline without the state and federal excises that are levied at the pump, yes. Just as profits and wages that are paid for out of business receipts from the sales of gasoline are taxed today under the income/payroll tax system.
What the FairTax legislation does is repeal federal income/payroll taxes in total, and replaces them with a single tax at the first retail sale of any new product or service.
The base price of gasoline without the state and federal excises that are levied at the pump, yes. Just as profits and wages that are paid for out of business receipts from the sales of gasoline are taxed today under the income/payroll tax system.The Fairtax is "23% of the gross payment" so it also taxes those state and federal excise taxes an additional 30% in the process.What the FairTax legislation does is repeal federal income/payroll taxes in total, and replaces them with a single tax at the first retail sale of any new product or service.
Just as profits and wages that are paid for out of business receipts from the sales of gasoline are taxed today under the income/payroll tax system.Not "just as" because the income tax doesn't tax gross profits including overhead and expenses as the fairtax would in it's "gross payments" tax.