Firstly -
The original thread is here and it has a lot of valid information and discussion - I wanted to bump it once I had some knowledge of the bill and such, but the thread sorta wandered away before I could butt in. I'd like to discuss this more now because I'm going to be a manager of a Jackson Hewitt location this upcoming tax season, and I'm in the process of studying for the 2006 Special Enrollment Examination. Bills such as the FairTax have a direct impact upon my future.
The FairTax bill -
Summary, Full Text, Status of this bill as it stands in the Senate.
Senate sponsors to the bill (other bills with the senator's sponsorship are noted in the {*}):
Saxby Chambliss, GA-R.{*}
Tom Coburn, OK-R. {*}
John Cornyn, TX-R.{*}
Johnny Isakson, GA-R.{*}
In essence, the Fair Tax repeals 26 USC Subtitles A, B, and C, leaving D through K. (ps: don't click on that unless you want to download a 24mb text file - if you want to see the code, try looking here.) Among these surviving contents are excise taxes, administration guidelines, and health benefit constructions, all of which have definitions and rulings that are in part based upon the contents of Subtitles A through C. One thing that I find interesting is that while fairtax.org's main page lists abolishing the IRS as one of the main points in the bill, nowhere in the summary or full text is IRS abolishment specifically mentioned. Furthermore, the full text gives a sample tax form (which would need to be filed monthly instead of annually) that would need to be processed by some organization; with this and the code that would survive with the changes, an IRS-like organization would be needed to administer the tax code and collection.
One projection of the FairTax's impact can be seen here.
VAT -Quote:
The Flat Tax bills to replace the Tax Code, S. 812 and S. 1099 (there were none in the House during the First Session[10]) would result in savings of $47.4 billion. A related proposal, the Fair Tax Act (H.R. 25 and its companion bill, S. 25) would save $11.2 billion annually over the next five years.
One alternative mentioned earlier was the value added tax. Such a concept has been tried in Michigan under the Single Business Tax. The SBT has been blamed for Michigan's poor economic growth and is set to expire by 2009.
Last points -
While it is important for American citizens to be fairly taxed, I think the NTU article shows that even substantial tax reform wouldn't offset the other problems and lack of balance in the federal budget. Even if the IRS were abolished, I think it would be in name only. Also, I feel that if 1040EZ were simplified any further, it would be a restaurant placemat.
