Tom Rants

I dont see how Fairtax can work as advertised. I wish it could.

For one thing — Fairtax is a tax on the federal government, by the federal government.

This just isn't some novel book keeping technique - Fairtax actually depends on collecting about 300 billion in tax, from the federal government, to pay for the federal government.

Boortz writes «the federal government itself becomes a major taxpayer» Page 148.

The federal government a major taxpayer? To itself?.

That's like the guy who decides he needs to make some big money. So he pays himself 10,000 dollars a day to cut his own grass.

Yes, he could write himself a check every day for 10,000 dollars. He can even deposit the check in his own account. But at the end of the month, he won't have 300,000 dollars..

Incredibly, Fairtax thinks they will have 300,000. Well — they pretend they have 300 billion. But they won't.

For example, when the Fairtax makes the US Navy pay 4 billion in «sales tax» on a 12 billion dollar aircraft carrier — the Navy can write the check, The Treasury can even deposit the check.

But the Treasury isnt 4 billion dollars ahead. The treasury had to issue the money to cover the check it cashed.

But Fairtax thinks they are getting that 4 billion -- plus 296 other billions - from making «the federal goverment a major taxpayer.»

Because the Fairtax would collect 300 billion less in tax revenue -- it would have to raise the tax rates -- probably to about 35-38%.

If that was the ONLY fallacy of the Fairtax -- it would be enough to ruin the idea. But there are more fallacies -- of even greater impact.

Another major fallacy — Fairtax pretends it will be able to tax health care. Fairtax looks to tax the 2 trillion dollar health care industry — to the tune of getting people to cough up 460 Billion in taxes on their health care.

Will health care patients just pay this 460 billion? If Fair tax CAN NOT collect this tax, — they lose 460 Billion more in revenue, and the tax rate has to go up to 50-50% percent.

You decide if people will pay the US government 460 billion dollars in taxes, on their health care.

What will a cancer patient do, when just ONE patient gets a tax bill of 40,000 dollars on their surgery, chemo, and hospital bill?

What about when 15 million cancer patients open up all their medical bills, and see a 35-40% sales tax on there? Forget the percentages -- when they see 10,000 - 50,000 tax bills, on TOP of their 30,000- 150,000 medical bills?

What do you think nursing-home patient will say, or the famlies they see a 25,000 tax, per year, on their nursing home care?

What would the parents of an 8 year old leukemia victim say, when they see a «sales tax» bill of 70,000 dollars, on their effort to keep their child alive?. Suppose further that the parents only make 35,000 a year.

Its not like the hospital can waive the sales tax. Its not like insurance is going to pay it.

What will people say when they see their bills — second opinions are taxed — lab tests — taxed — ER visits — taxed. Dental care -taxed. Doctor visits — taxed. Knee replacement — taxed. Child birth — taxed.

The outcry from these folks will be like nothing US history has ever seen before.

Congress would quickly exempt health care expenses from a high sales tax.

If any Congressman dared to suggest the parents of a cancer victim should pay a sales tax — they wont be a congressmen very long.

So the rate would have to be adjusted up — from 35-40%, to 55-60%

My point is — you wont be ABLE to tax health care. The Congerss would exempt it. So thats 460 Billion the Fairtax budget is shy, just from that. And 300 billion shy, just from not being able to tax federal government either.

Now — what would RENTERS say when they have to pay this 40-60% sales tax, on THEIR RENT??

Of the 40 million renters in the USA - I bet not 12 individual renters know their taxes would skyrocket the moment this bill is passed. And wow, will they have a few words.

I could go on — car makers, new home builders, there would be major problems in all markets that are hit by this absurd tax.

Fairtax would come up over a trillion dollars SHORT on collecting 2.3 Trillion.

It won't work. Im sorry.