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New FairTax Book

March 3, 2008

Boortz and Linder recently came out with another FairTax book, called FairTax: The Truth: Answering the Critics.

It’s been billed as their effort to “answer the outspoken and misinformed critics” of the FairTax. The main disappointment I have with the book is that it really only does that for about two chapters.

The book is still good, though, including more history about how the FairTax developed. The book does a good job of dealing with criticisms, even if it’s a little short on explanations here and there. It does not assume that you’ve read their first FairTax book, nor does it assume you’re familiar with all of the aspects of the FairTax. Between giving some history on the FairTax, and explaining most of its basic concepts, it’s not until about halfway through the book before they really take on the critics.

Perhaps the best stuff in the book is towards the end, though. There’s a great section where they describe what it would be like to have lived under the FairTax all of your life – receiving your entire paycheck. No payroll taxes. Knowing exactly what government is costing. Not having to base business or investment decisions on their tax consequences. And then they describe a politician trying to come and sell the current system as an improvement. Taxing your income. Taxing business profits, so there’s a hidden tax cost in everything you buy. Taxing investments. Even taxing death.

It’s a very interesting way to look at it, and it really helps to make it clear how much simpler the FairTax is, and how it removes government from more day-to-day business and personal decisions.

If you’ve been suspicious of the FairTax, I highly encourage you to pick this book up. It’s less technical than the first one, in some ways, and more visionary in tone. And many of your questions and concerns about the FairTax are probably dealt with in this book.

One criticism I felt like they should have dealt with better is the progressive nature of the FairTax. They explain the prebate well, and how that prevents anyone from paying taxes on the basic necessities of life (defined by the poverty level), and they explained how this makes the FairTax progressive. They also talked a good bit about net effective tax rates under the current tax system. But I think they could have talked more about net effective tax rates under the FairTax. I’ve left comments about this over at FairTaxBlog.Com, and I’ll probably work on a post about this particular issue in the future. It’s really important to consider net effective rates when people initially react to the idea of a 23% inclusive consumption tax.

(Actually, if you have serious questions or concerns about the FairTax, check out FairTaxBlog.Com. There are a lot of supporters and critics that can support their points very well there.)

I think this quote does a good job of describing the overall goals of tax reform, and what the FairTax will enable.

Under the FairTax Vision for Tomorrow, every time an American buys a loaf of bread or a new car, he’ll know, to the penny, how much of that money is going to the federal government.

Our vision for tomorrow sees a government that’s a partner with the business community and the people, not an adversary; a government with a tax system that encourages economic development and the creation of the new business, rather than a government and a tax system that chases valued businesses to foreign shores.

Our vision for tomorrow is one where governance returns to the local level; were communities are allowed to make the important decisions regarding their government and their schools. No longer will politicians be able to hide regulations and programs that control every aspect of our lives in 9 million words of confusing and draconian codes and regulation. The FairTax will demand political honesty…

Our vision for tomorrow sees an America where jobs are insourced, not outsourced… sees America becoming the safest and most secure tax haven for trillions of dollars currently languishing offshore… sees an America that will enjoy a virtual $400-billion-per-year tax cut… an exporting powerhouse, selling goods and services into a global economy unburdened by the 22 percent tax component now burdening our price system…

People see all of this and say, “how can a different tax system do that?” One point that I haven’t seen made clearly enough, is that the FairTax wouldn’t be responsible for any of this. The truth is that these “benefits” would not be due to enacting the FairTax, they would be due to completely getting rid of all of the oppression of the current tax structure on our economic decisions, while still funding our government. It is not the FairTax that would produce such wonderful results – it would be the American people, unencumbered by an oppressive tax system. How can you disagree with that?