A little about the fair tax

Judging by the responses I have gotten there are a lot of people interested in tax reform. A few weeks ago, I discussed in this column that Americans deserve a tax code that is simple, fair and promotes economic growth. Many of you asked me to share with you a little about the different ideas. I’ve always said that your priorities are my priorities, so this week I’ll tell you a little bit about the fair tax.

The fair tax would replace the current 54,000 page, 2.8 million word tax code. There would no longer be a federal income tax and no taxes on social security, capital gains, gifts or the alternative minimum tax. Instead taxpayers would be charged a single rate on new goods when they are purchased.

So for example if the tax rate were twenty percent, then any purchase at the store would include a federal tax of twenty percent. Your paycheck would no longer have taxes deducted from it by the federal government. April 15 would become just another day as the yearly ritual of trying to get your taxes filed on time would end.

One of the reasons I like the fair tax is because you determine the amount of tax you pay every month. Every taxpayer would receive a rebate for the essential services that you consume like food and clothing. I still have many questions about this type of tax, but I look forward to hearing more about it when my Tax Reform Advisory Council meets.