[RobFromGa]

The reason that your idea will not work is because if they exempted all that money, the FairTax rate on the rest would have to be even higher to make up for the loss of revenue.

John Linder has admitted that one of the beauties of the FairTax is that it is a “tax on accumulated wealth” so it isn’t likely that they will turn around and exempt accumulated wealth is it?

Think about the opposite situation, someone who is a big debtor and owes $75,000 in credit card bills, two car loans for a total of $50,000 and a $500,000 mortgage balance and a home equity line of credit. Every single one of those items would now be paid off in the “new dollars” so all debtors would right off the bat owe about 15-25% less “work hours” to pay off their debts.

Does this seem possible without the whole thing being a big free lunch scheme?

[Polybius]

The reason that your idea will not work is because if they exempted all that money, the FairTax rate on the rest would have to be even higher to make up for the loss of revenue..... John Linder has admitted that one of the beauties of the FairTax is that it is a “tax on accumulated wealth” so it isn’t likely that they will turn around and exempt accumulated wealth is it?.... Think about the opposite situation, someone who is a big debtor and owes $75,000 in credit card bills, two car loans for a total of $50,000 and a $500,000 mortgage balance and a home equity line of credit. Every single one of those items would now be paid off in the “new dollars” so all debtors would right off the bat owe about 15-25% less “work hours” to pay off their debts.

Their position is becoming crystal clear to me now.

[lucysmom]

John Linder has admitted that one of the beauties of the FairTax is that it is a “tax on accumulated wealth” so it isn’t likely that they will turn around and exempt accumulated wealth is it?

I guess elimination of the estate tax is compensation for double taxation in old age - of course that doesn't help the average retiree much.