What is fair?

I have to hand it to Mr Boortz and Con­gress­man Lin­der: whether you like their pro­pos­al or not, they are actu­al­ly think­ing about how to improve our cur­rent hideous tax­a­tion sys­tem. In fact, their pro­pos­al replaces the entire Inter­nal Rev­enue Ser­vice so unless you’re a big fan of the dev­il you know, right off the bat their pro­pos­al almost has to be a good one.

The Fair­Tax is a pro­pos­al to scrap the income tax in Amer­i­ca and estab­lish a con­sump­tion-based tax — essen­tial­ly a nation­al sales tax. Remem­ber the first part there when­ev­er you hear oppo­nents to the Fair­Tax claim that it would add a sales tax to the income tax­es we have already.

Boortz and Lin­der paint a com­pelling pic­ture, and it’s not my intent to restate their argu­ments. I’d rather you read the book or do oth­er research your­self and make up your own mind. Hav­ing said that it’s com­pelling, I am oblig­ed to pro­vide some rea­son that I’ve found it compelling.

First, *it would tax the wealthy with­out loop­holes and with­out sti­fling the econ­o­my*. That by itself seems like it should be the holy grail of tax sys­tems. The cur­rent debate over tax­ing the top 2% of earn­ers seems sim­ple to both sides, but the fact is that it’s not so sim­ple. Because both busi­ness­es and ind­vid­u­als are taxed by the same mech­a­nisms in the Unit­ed States, you can­not levy a tax against the fat cats with­out also hurt­ing the indus­tries (most­ly small to mid-sized busi­ness­es) we need to pro­vide jobs and do oth­er things that fall under the cat­e­go­ry of «eco­nom­ic growth.» Would­n’t it be nice to get rev­enue from the wealthy with­out stag­nat­ing the econ­o­my? Well, the Fair Tax is the answer to your dream.

Sec­ond, *it would end the night­mare of fill­ing out tax forms*. Since the Fair­Tax would be built in to every pur­chase of new goods, only retail­ers (most of whom are already fill­ing out forms for state sales tax­es) would have any increase in paper­work. And that increase would be more than off­set by the sav­ings in paper­work from not hav­ing to fill out cor­po­rate income tax forms for the business.

Third, *it would make it impos­si­ble for an indi­vid­ual to dodge pay­ing tax­es*. Sure, there are plen­ty of ways one could avoid pay­ing tax­es — by only pur­chas­ing sec­ond­hand goods, for exam­ple. But there are many neces­si­ties that can only be pur­chased new.

Fourth, *it would encour­age eco­log­i­cal­ly-friend­ly re-use* whereev­er pos­si­ble. Since the Fair­Tax only applies to new goods, there would be a sig­nif­i­cant price advan­tage to pur­chas­ing sec­ond-hand goods. In a cul­ture that already has too many dis­pos­able items, pro­vid­ing finan­cial incen­tive for peo­ple to pass on their goods and buy used items rather than fill­ing land­fills with per­fect­ly good equip­ment is a great move.

Final­ly, do I even need to say it? It’s fair. Peo­ple would get taxed based on their own choic­es. Peo­ple that buy yachts and Lam­borgh­i­nis will pay more each year in tax­es than I’ll earn in a decade, but they could eas­i­ly have avoid­ed pay­ing tax­es sim­ply by not buy­ing the stuff they want­ed to get. It makes it real­ly hard to com­plain about tax­es when you pay on what you spend rather than on what you earn.

I encour­age any­one to inves­ti­gate the Fair­Tax, whether you actu­al­ly read this book or not. How­ev­er, it is a pret­ty quick read, so any­one inter­est­ed in find­ing out more would do well to start with this book.

What I think will be more impor­tant than read­ing is writ­ing… I’m talk­ing about let­ters to your elect­ed rep­re­sen­ta­tives. Noth­ing will ever change unless there is demand from the con­stituen­cy for improve­ment. At this point, even get­ting the Fair­Tax into a more promi­nent part of the nation­al dis­course would be a great step in the right direc­tion. In the end, it seems clear that we real­ly ought to dis­man­tle the dra­con­ian behe­moth that is the IRS and get the coun­try’s rev­enue in a sim­pler and more reli­able way. The Fair­Tax may not be the sys­tem we end up with, but it’s a much bet­ter idea than the sys­tem we’ve got.