Why is the Fairtax not fair?

Question

please try to give informed answers, thanks.

Answer 1

Because different people pay different amounts of tax.  In a truly "fair" system every person would pay exactly the same amount:  Take all government expenditures, divide by the number of people, and that's the amount each person has to pay.  After all, when you buy a movie ticket, it's not some percentage of your income you pay, it's some fixed amount, because you're all seeing the same movie and it doesn't matter what your income is.  If you all get the same government, you should all pay the same amount.

Of course, a tax like that would lead to open revolt since it would be more that some people make in a year making it impossible for those people to pay.  FairTax (and every other viable taxation system for that matter) is a compromise between what is "fair" and what we can actually get away with.

Answer 2

It would tax most heavily those who can least afford it, increasing taxes the most on the poorest. 50% of Americans make less than $40,000 a year and on average have negative savings.Taxing them further would force them into bankruptcy.

The wealthy could easily circumvent such a tax, the poor could not. Furthermore, many people have their retirement accounts in a Roth IRA, in which they paid income taxes up front to exempt it from income tax later. A consumption tax replacing income tax would heavily favor people with 401k accounts (which don't pay income tax until disbursal)  while severely penalizing people with Roth retirement accounts.  

It would also discourage consumption, slowing down the economy. The only area where consumption taxes are a good idea are on the consumption of things that are damaging to society, such as fossil fuel consumption, alcohol, and cigarettes. A large oil import tax would lead to independence from foreign oil.

Answer 3

It is basically federal sales tax.  It doesn't distinguish how much you make, just the same tax on everything you buy.  It would allow the richest people out of the higher tax bracket and put more of the burden on the lower and middle class.