Could you go over the economics of the Fair Tax Act?

Good morning! I would like to see analysis on Thomas Maddie's Fair Tax proposal and what that kind of (sales/consumption) tax would do. No more income , payroll, capital gains, or corporate income tax. Rebates would be given to families based size to meet their "basic needs" via the Official poverty measure. I fear younger and older Americans and immigrants will feel this burden while established Americans (rich, upper-middle class) will not need to buy goods as much as the former group. The fair tax also assumes the neoclassical assumption that individuals are assumed to want more and more while constrained by budgeted incomes. While this is true in theory, reality means some people may not use the extra untaxed money, and the government is then stripped of its revenues. IRS agents are now without jobs and incomes. Thank you.

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  • Colin Siert
    published this page in Ask Prof. Wolff 2017-02-21 11:17:42 -0500