Corporations would pay tax on the thins they buy like everyone else. Airlines would have fuel taxes like hey have now.
We are talking about a replacement for the income tax.
Right now, only half the population pays a tax on their income.
The federal sales tax would compensate for the one half of Americans who pay an income tax and replace that revenue for the government. and the government would have to learn to live within its means.
What we do about the corporate tax is another issue.
Things would have to be done incrementally.
What’s your plan?
Well, clearly if you believe in some kind of corporate tax, then some kind of agency is going to be necessary to enforce the system. And, if Cruz believes that individuals should pay tax (even on a postcard, which is an absolutely ridiculous idea), then something like the IRS is necessary. No, I don't work for them...I fight with them on a regular basis. However, the ridiculous idea of doing away with them, THEN starting a brand new agency called the "Cruz replacement group which will be much nicer than the IRS" is almost laughable. It will cost 100X as much to start over than it would be to clean up the present system.
And, by the way, there will be just as much cheating on his ridiculous "postcard" return as there is now. The problem is (and always has been) defining "Income". Some folks say that income is only wages. Some say it is only investment income. Some say it is neither. The problem isn't the "flat rate" (like Cruz claims), it is defining the thousands of ways to make money, but not make it look like I made money. Capital gain? That was Romney's gimmick. Holding stock? That's Buffet's gimmick. Bartering? That is half of the Preppers gimmick. Without an "IRS", these characters would bring the tax paying public to 4% of the population.
And, as far as a plan...notice the problem. If all individuals take money "in" and spend money "out", then the challenge is to capture a bit of it going each direction. If we have just an "income" tax, then the slick willys find a way to earn it offshore (witness UBS, and the Cayman Islands). If we have just a "sales" tax (a consumption tax) then we will drive folks to buy offshore or through the internet avoiding the 23% sales tax add-on. If you think job creation is tough now, wait until there is no consumption of American made and sold goods.
But...if we lower the income tax rates, remove some of the reasons that a person can use to not file and pay (that is, take away the Earned Income Credit for folks above $ 25K), take away Social Security for the folks earning $ 500K and above and compel everyone to pay some PLUS have a small consumption tax (say 5%, rather than 23%), then we capture some revenue from all folks either coming or going. And. let's face it...even though we would like to tar and feather the guys who ramped up the debt (Obama, the Dembs, the Rinos) WE ARE GOING TO HAVE TO PAY it back. So, we might as well face into it and roll up our sleeves.