The Flat Tax is a much simpler, much less costly, and much more efficient means than the Fair Tax to collect federal taxes. Furthermore, I believe the Flat Tax is a much fairer tax than is the Fair Tax, because it taxes all dollars of income equally. The Fair Tax does not tax all expenditures equally, thereby making it an unfair tax.
1. Federal sales tax on the sale of all new products and services except education;
2. Sale of used products are not taxed;
3. The Fair Tax’s sales tax is collected by businesses that then pay the accumulated tax to state tax authorities;
4. State tax authorities monthly or semi monthly pay the accumulated fair tax to the federal tax authority;
5. All heads of households receive a prebate, based on dependents, from the federal tax authority that cover all taxes on necessities;
6. The fair tax rate—23%—and items taxed are specified by Congress in the adoption of the original Fair Tax Bill, and can be changed only by a two-thirds majority of both houses of Congress;
7. The Fair Tax requires a Constitutional Amendment that requires that there will be no other federal tax.
8. The Fair Tax eliminates all paperwork for keeping track of incomes, investments, et cetera;
9. The Fair Tax increases all state and federal paperwork for keeping track of all expenditures and the tax on expenditures;
10. The Fair Tax picks up more taxpayers, drug dealers, prostitutes, illegals, and tourists—a larger than current base of payees who will all pay taxes;
11. The Fair Tax makes American products cheaper overseas as their prices will not include taxes in them when sold overseas, but products coming in from overseas will be taxed at 23 percent.
1. All gross annual individual income is taxed at the same rate per dollar regardless of the magnitude of the individual’s gross annual income—for example, a 6% tax rate on a $10 thousand gross income is taxed $6 hundred, on a $1 million gross income is taxed $60 thousand, on $1 billion gross income is taxed $60 million, on $1 trillion gross income is taxed $60 billion;
2. All gross annual individual income taxes are paid directly to the federal tax authority;
3. The flat tax rate—10%—on all gross annual incomes is specified by Congress in the adoption of the original Flat Tax Bill, and can be changed only by a two-thirds majority of both houses of Congress;
4. When the total of gross annual individual incomes is $10 trillion, the total taxes collected by the federal tax authority would be 10% of $10 trillion = $1 trillion;
5. The Flat Tax picks up more taxpayers who will pay taxes that have not previously been required to pay income taxes—about 45% of income earners— making a larger base of payees who will pay taxes;
6. There are zero deductions, exemptions, prebates, refunds, or other exceptions;
7. The Flat Tax requires a Constitutional Amendment that requires that there will be no other federal tax.
Total Personal Income ($000s), U. S. and States: 1990 to 2010
Area 2010p 2009r 2008r 2007r 2006 2005 2004
U.S. $12,530,101,184 $12,168,161,000 $12,380,225,000 $11,900,562,000 $11,256,516,000 $10,476,669,000 $9,928,790,000
Area 2003 2002 2001 2000 1999 1998 1997
U.S. $9,369,072,000 $9,054,702,000 $8,878,830,000 $8,554,866,000 $7,906,131,000 $7,519,327,000 $6,994,388,000
Area 1996 1995 1994 1993 1992 1991 1990
U.S. $6,584,404,000 $6,194,245,000 $5,866,796,000 $5,558,374,000 $5,335,268,000 $5,013,484,000 $4,831,282,000
Annual analysis for 2010.
1.0 trillion/12.530 trillion = .07981 or 7.981% = 8.0%
$12,530,101,184,000 = $12.530 trillion
.08 * $12.530 trillion = $1.0024 trillion
A trillion dollars in annual federal revenue is more than enough to finance the lawful functions of the US federal government.