a rehash of fairtax misinformation

Once more proponents have to deceive in order to make a point. I would think most of the people writing this stuff have a better education then I, however with as misleading as this is I begin to wonder. If the Fairtax was instituted the market would decrease the prices by the amount of taxes which have been removed from the item being sold. This is the magical 23% that is being bantered around. Now it stands to reason for anyone that can think that if the cost of all products were decreased by 23% then a 23% sales tax was instituted on said product the result would be the same.
Take the candy bar example, a dollar candy bar with a 23% tax would cost $1.23 however with the fairtax the imbedded taxes are removed which makes the one dollar candy bar retail for $.77 and then the 23% tax is added which brings the cost of said candybar to a dollar.
Don't take my word on it though read up on the bill yourself with the link below, keep in mind however the 23% figure was based upon government expeditures before the republican controlled congress went hog wild with the checkbook

http://www.jpfo.org/fairtax.htm

The rate of a national sales tax would be colossal. Remember, even the proponents admit they'd need a 23 percent tax rate to fund the current size of the federal government. However, they are starting out their new fair tax system with highly deceptive language.

H.R. 25, Section 101(b)(1) states �FOR 2005- In the calendar year 2005, the rate of tax is 23 percent of the gross payments for the taxable property or service.� Note the phrase �of the gross payment.�

Here's how it works: You buy a candy bar for a total price, including tax, of $1.30. One dollar of that price pays for the candy bar, $.30 goes to the federal government.

One dollar purchase + $.30 in tax sounds like 30 percent to you and me (and to every state that currently has a sales tax). But the �FairTaxers� don't calculate it that way. They say: $1.30 total price. $.30 = 23 percent of $1.30, therefore the tax is 23 percent.

Many critics have pointed out that this is a deceptive way to calculate a sales tax. AFT rebuts the critics by saying (we paraphrase for simplicity), �If you made $1.30 in income and paid $.30 of it in tax, you'd call it a 23 percent tax rate.� The 23 percent figure is what AFT refers to as the �tax inclusive� rate.

But a sales tax is not an income tax, and when we see national sales tax advocates and uncritical journalists promoting the 23 percent figure without giving the underlying explanation, we can only think that some very thick wool is being pulled over people's eyes.

It gets worse. A 1998 analysis by the William Gale of the Brookings Institute calculates that in reality (to pay all current government expenditures while also compensating for such factors as tax evasion), the national sales tax might have to run as high as 67 percent. AFT disputes that high figure. But they do not dispute that their initial �23 percent� tax rate would actually be achieved by adding 30 percent to the purchase price of goods.

Bruce Bartlett a senior fellow for the National Center for Policy Analysis, slams the 23 percent claim, also, saying it's too low even to cover current government spending. He writes in the National Review:

When Congress' s Joint Committee on Taxation scored the Linder proposal [The �Fair Tax Act�] four years ago it estimated that it would actually require a tax-inclusive rate of 36 percent, not 23 percent, to equal current federal revenues. Calculating the rate in a normal, tax-exclusive manner would mean a 57 percent rate.(2)

Once again, although the FairTaxers dispute most of Bartlett's claims on their website, they make no attempt to refute the basic fact: their �23 percent� is really 30 percent, under the rosiest possible scenario.