Missouri's 7th District, U.S. House of Representatives




Congressional Issues 2010
The "Fair Tax"

Congress should
  • Not adopt a "Fair Tax" proposal unless subsequent to or simultaneously with the abolition of the Internal Revenue Service.
  • Cut taxes by cutting unconstitutional spending
  • Cut taxes more by cutting spending which might be "constitutional," but is still wasteful compared with a Free Market (e.g., USPS).

According to proponents, The FairTax:

  • Abolishes the IRS
  • Closes all tax loopholes and brings fairness to taxation
  • Maintains our current Social Security and Medicare benefits
  • Brings transparency and accountability to tax policy
  • Allows American products to compete fairly
  • Reimburses the tax on purchases of basic necessities
  • Enables retirees to keep their entire pension
  • Enables workers to keep their entire paycheck
  • Makes America's tax code truly voluntary, without reducing revenue
  • Replaces today's indecipherable tax code with one simple sales tax
  • Protects lower-income Americans by covering the tax on basic necessities
  • Eliminates billions of dollars in embedded taxes we don't even know we're paying
  • Brings offshore corporate dollars back into the U.S. economy

Jim Cox has noted the following excellent points made by promoters of the "Fair Tax" (numbers in parentheses refer to The FairTax Book by Neal Boortz and Congressman John Linder):

  • The progressive income tax is noted as a major plank in Karl Marx’s ten-point plan for a communist society (p. xx–1) as are government schools (1).

  • Tax confiscations are limited only by the people’s willingness to tolerate it; politicians have no limit to what they would take (10).

  • The U.S. survived with no income tax for most of its history (10).

  • The intended federal system, with 95% of the governing at the local level and a mere 5% by the national government, is noted (10–11).

  • Citing Thomas Woods, it is noted that the war of 1861–1865 was not a civil war, but a war for independence from the national government (11).

  • The sordid history of the income tax, based on the work of Arthur Ekirch, is recounted in detail (11–30).

  • It is routine for politicians to give a bill a deceptive title (12).

  • Charlotee Twight is referenced regarding the history of the withholding feature of the income tax (23).

  • Corporations don’t pay taxes; only individuals do (32–37).

  • The high cost of tax compliance is noted (39–50).

  • The employer’s share of Social Security and Medicare is actually paid by the employee (42, 125).

  • The IRS helpline gives out faulty information as a matter of routine (48).

  • Taxes add significantly to the cost of goods we buy (51–60).

  • Corporations move offshore to avoid the high US tax rates (62–67).

  • The fraud of the Earned Income Tax is noted (83).

  • The politicians have the audacity to call any money they don’t tax away from those earning it, "tax expenditures" (96).

  • Milton Friedman is quoted on the relation of economic freedom to freedom in general (109–110).

  • Knowledge of the tax code is the lobbyists’ intellectual capital (114).

  • There have been ten thousand amendments to the simplified tax code of 1986, all to the benefit of those lobbying for the changes (115).

  • Unearned income is set off in quotation marks to indicate the phony distinction between it and earned income (126–128).

  • James Bovard’s book Lost Rights is recommended (145).

  • An entire chapter is devoted to IRS outrages (139–146).

  • Milton Friedman is quoted on the ill effects of a Value Added Tax (154).

  • Congress can be depended on to spend every dollar it gets its hands on to fund vote-buying programs (136).

  • Frank Chodorov is favorably cited as a champion of liberty (175).

  • America became great due to the freedom of the people rather than due to government programs (176).

All of this means that no matter how well-intentioned supporters of the Fair Tax might be, politicians cannot be trusted to cut taxes. The Fair Tax Act needs to be sharply limited to exclude additional new taxes or retention of the old Income Tax.

next: Taxation