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A Few Thoughts on the FairTax Act

Robert Dimuro

Posted on July 21, 2019 09:25

2 users

The FairTax is arguably the most beneficial tax system for the taxpayer AND the federal government.

Not too many Americans would disagree with the statement that our tax system is rife with problems and needs reform, just like healthcare. However, not too many Americans realize that there are common-sense alternatives to our oppressive tax system that would streamline the tax-collecting process and allow taxpayers to keep much more of their wealth without having to relinquish government benefits. One of these solutions is the FairTax.

The simplest way to describe the FairTax is as a system that implements a national sales tax and eliminates all other federal taxes. Although politicians haven't touted the FairTax as much as the flat tax or the VAT (Value-Added Tax), it's arguably the most beneficial for the taxpayer and the Federal government.

If the FairTax were implemented, the taxpayer would receive all of the money they earned in their salary. At the same time, the government would receive more revenue, as the FairTax would broaden the tax base and increase total economic output. Consequently, the government would function as it normally does, avoiding the political nightmare of having to cut spending on public benefits. 

Other benefits for taxpayers would include the elimination of the IRS, the elimination of multiple taxation, and the re-taxing of money already taxed. Moreover, the FairTax would incentivize states to eliminate state income taxes to be more competitive with other states. Taxpayers would be encouraged to save and invest more of their money. If there are any cons to this system that I haven’t mentioned, the benefits would seem to far outweigh them.

The beauty of the FairTax is that it doesn’t have to be branded as either a tax increase or tax cut - rather, simply, as a tax replacement for our current system that is both inefficient and outdated. In light of this, the FairTax should have bipartisan support and have no trouble getting through both houses of Congress en route to the President’s desk. 

Sadly, there's virtually no chance that Democrats in Congress would ever endorse this idea. They would insinuate that this system is unfair, as it wouldn’t tax the wealthy enough. However, the FairTax would come at no expense to the benefits received by the nation’s poor and the net amount of taxes they would ultimately pay. This makes sense when you understand the Democrats' value system. They place more emphasis on supporting initiatives that are perceived to be fair and moral than ones that are economically viable. 

Ultimately, a tax solution that's simple and practical will almost surely never be implemented because of the power and influence that our fourth branch of government exerts on society. Just think of the turmoil that would unfold if we were to eliminate an entire government agency. Even the latest partial government shutdown over which Trump presided was blown out of proportion by the media and the Democrat Party. Unfortunately, our tax system is much more likely to become more progressive and more oppressive as the years go by.

Robert Dimuro

Posted on July 21, 2019 09:25

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Justin Dent , The Hill There should be bipartisan agreement that proposed tax reform will significantly benefit the millennial...

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