In response to my lengthy paper regarding H.R. 25, the “Fairtax”, Mr. Neal Boortz published a response responding to a few of the issues discussed in my paper.
Let’s first go to Mr. Boortz’s refusal to acknowledge and admit that the Fairtax is a 30% sales tax. He says:
The Fairtax is not a traditional sales tax. Consumer prices are quoted with the sales tax included.
The first sentence of this statement is inaccurate. A sales tax is commonly defined as a tax levied on the sale of goods and services. The tax proposed under H.R. 25 is a traditional sales tax, a tax levied on the sale of goods and services. The only difference is that the tax under H.R. 25 is calculated in an untraditional manner and in a manner that arguably attempts to hide the rate of the tax from the public.
Traditional Sales Tax Calculation
Cash going to the seller
$100.00
Traditional sales tax at 23% rate
$ 23.00
Total price to customer
$123.00
Taxes paid by the customer
$ 23.00
H.R. 25 Sales Tax Calculation
Cash going to the seller
$100.00