‘Fair Tax’ is a better way to compete
I recently heard ads that criticized a candidate for wanting to eliminate corporate income tax, and I looked into the proposed changes at FairTax.org.
The TV ads left out most of the story; individual income tax and Social Security tax would be completely eliminated and replaced by a consumption tax. The Fair Tax is revenue-neutral; it is progressive due to a “prebate” paid to citizens and legal residents. You are not taxed on anything that you earn or save, but only on what you consume.
Creating jobs and investing in production will not be taxed. Exports will be less expensive and more competitive, and imports will be taxed at the retail price. The Fair Tax is the best approach that I have seen for helping the U.S. compete in world markets and create jobs at home.
We, the consumers, already pay for corporate income taxes in the form of higher prices for all goods that we buy, spending our income that has already been taxed and Social Security deducted as well. Our employers paid matching Social Security and Medicare payments. Even those who receive Social Security payments are taxed again.
Our tax code is so complicated that even the current Secretary of the Treasury said that he couldn’t figure out his personal taxes. The tax code also penalizes companies that bring profits home from abroad, raises costs of our exports, and effectively subsidizes sending jobs overseas.