Regarding your opinion on needing to overhaul the tax code, it
has been asserted that a national consumption tax like the FairTax
would harm the economy, and more specifically would harm retailers
in New Jersey. This is not the case.
Editor,
Regarding your opinion on needing to overhaul the tax code, it has been asserted that a national consumption tax like the FairTax would harm the economy, and more specifically would harm retailers in New Jersey. This is not the case.
If one closely reviews the argument for the FairTax, the case is made clear that we already pay a consumption tax, through retailers in the form of a hidden charges covering the income taxes of all of the components of the products we buy new. In the FairTax thesis, the income tax must be eliminated completely in order to eliminate the hidden charges on new goods and services. Then the retail sales tax fills up the gap in equilibrium.
True, any retailer who tries to maintain pricing for non-existent hidden charges will suffer greatly, and that is the point of FairTax – that market pressures will cause the pricing of most new goods and services to remain at the same level before and after the sea change to a FairTax system. In consideration for the few goods and services for which there will be an increase in pricing due to the FairTax policy, a rebate system is established so that the government returns money each month to the consumer rather than withholding it.
The FairTax is rather ingenious and more importantly, it is a fair, efficient and transparent way for the government to collect revenue. Finally!
Please stop repeating the nonsense about sticker shock! The only shock people are concerned with today is paycheck confiscation shock … and that has to stop.
Mark Olin, Indiana
