Stinger said:
It's "Inclusive" and Exclusive" not internal and external. The income tax is an Inclusive tax so the rate for the fair-tax is quoted that way because that is the tax it replaces. As an exclusive tax it is 30%, but the effect on the taxpayer is the same.
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Figure 5: 23 percent tax-inclusive vs. 30 percent tax-exclusive
Nothing "slick" about it, trying to claim they were trying to hide the actual cost was trying to be slick though.
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Saying it is a 23% tax, when for most people if you add a $30 tax to something that costs $100 that would be a 30% tax, is "slick" IMO.
But if you want to talk about slick and misleading, that little chart is another perfect example.
When you look at this chart, you think Wow! With the fair tax, I keep all my money. I can spend the same, and I’ll have an extra $23 left over to save or buy more stuff, and the Govt gets the same tax revenue!
Amazing! What a great idea!
But here's the little trick -- if you spend $77 with the Fairtax system, the tax is included in that $77 as a 23% internal tax (ie the tax is 23% of the price). Therefore, the Gov’t only gets .23 x $77 = $17.71. You’d have to spend the entire $100 for the Govt to get the 23% tax.
Cute, eh?
Plus, the implication is that the $77 you spend gets you same amount of stuff as the $77 you spend now, which ignores the fact that with the Fairtax there is a 23% sale tax embedded in the price, so you are really only getting $77-23%=$60 worth of stuff. With that 23% tax, you’d have to spend $100 to get the same amount of stuff ($100-23%=$100-$23=$77). You essentially end up in the same place as before.
But that is not what the chart is meant to suggest, of course. That is the misleading part of it.
You've shown no evidence of that.
Not in this thread. This is not a thread about the fairtax. But I'll add "in my opinion". We can start another fairtax thread and debate it again. I'm sure my posts on it are buried somewhere.