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FAIRTAX 101

 

In response to the growing interest in the FairTax, the Chippewa Valley chapter of the FairTax campaign was established. Our goal is to educate you on the FairTax Act, gain your support, and let our representatives in Washington know who you are and that you would also like them to support the Act. We do not endorse any particular candidate for office nor are we affiliated with any political party. Read our Mission Statement

FairTax History

In 1994, three Houston businessmen were meeting together for lunch. As was common, they began commiserating about the ridiculousness of the Federal Income tax code. But at this particular lunch, they decided to do something about it, and each pledged $1.5 million as seed money to hire the best tax experts in the country to identify the faults with the current system, to determine what American citizens would like to see in tax reform, and then to design the best system of taxation. With their initial infusion of $4.5 million, the three went on to raise an additional $17 million. That money funded focus groups with citizens around the country as well as studies with nationally prominent experts in tax policy. The market research also included telephone surveys, targeted advertising, and measuring website hits from that advertising. All the research was extensive and distinguishes the FairTax from every other tax reform proposal ever put forward. The FairTax is a thoroughly and professionally researched response to the question: "What do the American people want in their tax system?"

FairTax Basics

The FairTax is an idea. It imagines the Federal government collecting taxes in a revolutionary way. In this idea the government no longer collects Income tax, Social Security tax and Medicare tax, meaning you would bring home everything you make. The government would no longer collect Payroll tax, which means employers wouldn't be taxed for paying their employees or see a tax increase every time they give their employee's a raise. The government would no longer collect estate tax and capitol gains tax, which means you don't get more taken from you the more you get ahead.

The FairTax idea calls for the government to replace the current system, with all of its deductions, revisions, brackets, loopholes, and politicking, with one national consumption tax on all NEW goods and services at the retail level rate of 23/30 percent. What this means is that a tax is added to the price of every new good or service that is sold retail. Business to business transactions are tax free which, along with the elimination of the payroll tax, would create a business environment second to none in the world. Business' would inevitably flood to the U.S.

The FairTax would expand greatly the number of people paying taxes because the current system doesn't tax non-citizens or those working under the table. This alone would make for a worthwhile debate, but the FairTax doesn't stop here. The FairTax recognizes that under any tax system the ones hit the hardest are the poor. And while the FairTax as an idea would do more to encourage hard work, saving and growing one's wealth than any other tax system ever, it proposes an idea to help the poor just as they are.

The FairTax calls for a monthly "Prebate" that would pay every American citizen the amount in taxes spent on goods and services up to the poverty line. To clarify, the government would determine each year what the poverty line is. Then they would determine how much one would pay in taxes on that amount each month. Whatever that amount is, would be paid to every citizen at the beginning of every month. For those living below the poverty line, they would actually end up with a monthly revenue stream.

The FairTax is more than just an idea; it is a bill that has been drafted by United States Congressman John Linder (R-GA). This bill sits in waiting for the support necessary to push it past lobbyists, political favors, politicians dependant on the current system to buy votes - enough support to push it all the way to the President's office.

FairTax Act - Thumbnail Sketch
FairTax Act - Plain English Summary
Democrat Benefits

Eliminates the regressive tax on wages of    the working poor and middle class
Meets the entire Democratic tax agenda,    starting with progressivity
Promotes the American Dream
Taxes every dollar of accumulated wealth    in the most effective way possible - when it    is spent
Rewards education and upward mobility
Creates equality because everyone's    resources get taxed at the same 23%    effective rate
Eliminates steep budget cuts by    eliminating the income tax system and    replacing it with a revenue neutral tax    system

Watch Jessica Wexler speak out in
support of the FairTax

 

Republican Benefits

Removes the IRS and 67,500 pages of tax    code and $265 billion spent annually on    tax code filing and compliance
Provides a boost to the American economy
Creates transparency in government by    removing tax code as a way for Congress    to punch enemies and help friends
Keeps the military strong by creating a    broader base of tax revenues for funding
Creates a new system that does not favor    debt over wealth -- unlike our current tax    laws
Taxes everyone, allowing no one to fly    under the tax-paying radar including illegal    immigrants and tourists who currently    don't pay taxes
Brings job back to America by making the    US a worldwide magnet for capital and    investment

 

National FairTax Effort