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|   **NESARA\                                                           |
|   The National Economic Stabilization and Recovery Act**              |
|                                                                       |
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|   **Monetary and fiscal policy reform that will double the standard   |
|   of living for every American\                                       |
|   within one generation and restore economic and social prosperity    |
|   across the land.**                                                  |
|                                                                       |
|   ** **                                                               |
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|                                                                       |
| **[NESARA---A Proposed                                [**Draining the |
|   Bill](http://nesara.org/bil                                         |
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  ***How Does NESARA Compare to Other Proposals?\
  The Fair Tax Act of 2003 (H.R. 25)\
   ***

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| Although NESARA proposes replacing the income tax with a national     |
| retail sales tax, the NESARA and FairTax plans differ considerably.   |
|                                                                       |
| FairTax taxes all retail sales events. That means all necessities of  |
| life---food, medicine and mandated expenses---all will be taxed. Such |
| an approach is                                                        |
| [regressive](http://nesara.org/main/dictionary.htm#regressivetax).    |
| NESARA provides 20 classes of straightforward at-the-counter          |
| exemptions ([NESARA, Part II, Section                                 |
| 5(C)](http://nesara.org/bill/part2a05.htm#c)).                        |
|                                                                       |
| To offset this violation of basic rights and regressive approach,     |
| FairTax proposes a monthly rebate to "qualified families" (*FairTax,  |
| Title II, Sections 301--305*). This action clearly voids some of the  |
| reasons for abolishing the income tax---the intrusion of government   |
| into our private lives and the continuation of the social welfare     |
| state. Americans have had enough of this administrative legal plunder |
| mind set.                                                             |
|                                                                       |
| Qualified family eligibility is dependent upon an arbitrary           |
| administratively defined poverty level, with Health and Human         |
| Services defining that level (*FairTax, Title II, Section 303*). The  |
| government-by-administrative-agency nonsense continues. Worse yet,    |
| the Social Security Administration stays involved in the tax game     |
| because that agency has been delegated as the agency to mail the      |
| monthly rebate checks (*FairTax, Title II, Section 304*). No family   |
| member may be counted toward the rebate unless the family member      |
| applies for and receives a social security account number (*FairTax,  |
| Title II, Section 302(b)(2)*). So much for privacy and the end of     |
| that obnoxious number.                                                |
|                                                                       |
| Furthermore, to remain qualified, families must register              |
| ***annually*** (*FairTax, Title II, Section 302(d)*). Fail to         |
| register every year and families lose their eligibility for receiving |
| the rebates (*FairTax, Title II, Section 302(f)*).                    |
|                                                                       |
| Almost comically, if not so sad, FairTax excludes family members who  |
| are incarcerated, or will be incarcerated (*FairTax, Title II,        |
| Section 302(l)*). This is a strange concept. Apparently the entire    |
| reason for the rebate program is to negate the regressive effects of  |
| the tax on essentials of life, especially to those considered living  |
| below the so-called state-defined poverty level. Nobody needs to be a |
| rocket scientist to know that many of the people who are incarcerated |
| are people who live below the poverty level, and are often the        |
| breadwinners of the family. The same holds true for political         |
| prisoners---people who have been convicted of arbitrary statutory     |
| crimes.                                                               |
|                                                                       |
| Lastly, notice that the natural rights and essential purchases of     |
| only "qualified" families are acknowledged (*FairTax, Title II,       |
| Section 302*). The rest of America is evidently not qualified. Legal  |
| plunder continues.                                                    |
|                                                                       |
| Under FairTax, the federal government still will be in the social     |
| welfare business, handing out checks. Proponents of FairTax claim no  |
| exemptions are necessary because to do otherwise will promote special |
| interests lobbying. Yet, those proponents turn right around and       |
| provide exemptions to so-called "qualified" families, instead of      |
| straightforward exemptions at the cash register. Such proposals allow |
| for government noses to stay protruded into people's lives.           |
| ***Everybody*** has a special interest in working, eating, housing,   |
| receiving medical care and buying insurance. What is so hard about    |
| exempting the ***essentials*** of life and simply getting government  |
| out of our private lives? The entire rebate process is repugnant and  |
| preposterous.                                                         |
|                                                                       |
| The question must also be asked, what are the ***administrative***    |
| costs of this complicated rebate process, as opposed to simple,       |
| straightforward at-the-counter exemptions? Additionally, what are the |
| administrative costs associated with the complicated system of        |
| credits provided by the bill (*FairTax, Title II, Sections            |
| 201--207*)?                                                           |
|                                                                       |
| Although the working class pays the sales tax, purchases made for     |
| business/trade purposes are ***exempt*** from the sales tax           |
| (*FairTax, Title II, Section 102, 103(g)*). Perhaps people can see    |
| why so many businesses, corporations, and trade associations are in   |
| favor of the bill! Not only are big business, that is, big            |
| contributors, relieved of the corporate income tax, capital gains     |
| taxes, depreciation schedules, and paperwork on employee withholding, |
| those companies also will be subject to ***no*** national sales taxes |
| on any business investments. Who is left with the burden of the       |
| national sales tax? The working class of America. Surprise! Surprise! |
|                                                                       |
| FairTax attempts to tax barter transactions (*FairTax, Title II,      |
| Section 103(f)*). Barter is ***not*** a commercial retail event and   |
| is not taxable. Barter is a like-for-like trade action between        |
| private parties and is not an event in commerce. FairTax will convert |
| an honest transaction into a crime. Shades of the current Internal    |
| Revenue Code.                                                         |
|                                                                       |
| FairTax requires sellers to establish bank accounts (*FairTax, Title  |
| II, Section 501(e)*). As with the income tax, we smell a few unlawful |
| seizures around the corner, as well as a few fishing expeditions by   |
| the taxing authorities. Under NESARA, sellers are liable to pay the   |
| tax. Period. That is all that is needed. Numerous sellers could make  |
| their deposits directly into a single national sales tax bank account |
| opened by the government at each local bank much more efficiently     |
| than forcing ever seller to open and maintain a separate commercial   |
| bank account for their sales tax deposits. It is rare for anyone to   |
| have problems depositing money into a bank account; getting the money |
| out is the usual difficulty.                                          |
|                                                                       |
| In any case, bank accounts are irrelevant, nor should any person be   |
| coerced into opening a bank account. Forcing people to open bank      |
| accounts is a violation of the fundamental right to contract and not  |
| contract. So much for financial privacy and protection of rights!     |
|                                                                       |
| FairTax requires sellers to post bond (*FairTax, Title II, Section    |
| 501(g)*). There is no reason for such nonsense.                       |
|                                                                       |
| Worse, FairTax requires all sellers to *register* with Uncle Sam      |
| (*FairTax, Title II, Section 502*). FairTax states that any seller    |
| who fails to register is not allowed to sell (*FairTax, Title II,     |
| Section 502(e)*). In other words, *failing* to register converts the  |
| normal business of selling into a crime! Again, so much for privacy.  |
| Instead, we have nothing but a clever disguise for State control and  |
| monitoring. Resistance against registration likely will be just as    |
| belligerent as with the current income tax.                           |
|                                                                       |
| Of course, because FairTax will tax service contracts, that           |
| essentially means all laborers and contractors must register with the |
| state. Furthermore, taxing labor is a [time bomb waiting to           |
| explode](http://nesara.org/faqs/nrst.htm#shouldlaborbetaxed) (please  |
| read the following sections).                                         |
|                                                                       |
| NESARA proposes a national sales tax rate of 14%, equal to \$14 on a  |
| taxable purchase of \$100 for a total cost of \$114. This is the      |
| usual method of calculating a sales tax---as an add-on. The FairTax   |
| national sales tax rate is 30%. That is a total cost of \$130 for     |
| buying a \$100 item. FairTax proponents claim an initial rate of 23%, |
| somewhat deceptive because that rate is calculated by dividing the    |
| \$30 tax by the total cost of \$130.                                  |
|                                                                       |
| FairTax also eliminates all payroll taxes including Social Security   |
| and Medicare (*FairTax, Title I, Section 102*) making the initial     |
| FairTax sales tax rate (*FairTax, Title II, Section 101(b)*)          |
| necessarily that much higher than the rate proposed by NESARA         |
| ([NESARA, Part II, Section                                            |
| 5(A)](http://nesara.org/bill/part2a05.htm#a)). Still the NESARA       |
| proposed base rate of 14%, is less than the general revenue rate of   |
| 14.91% proposed by FairTax (*FairTax, Title II, Section 101(b)(3)*).  |
|                                                                       |
| Although neither bill attempts to resolve the Social Security and     |
| Medicare mess, NESARA leaves the payroll taxes untouched. FairTax     |
| eliminates the payroll taxes, but employers still will have to report |
| wages paid in order for employees to receive Social Security credits  |
| (*FairTax, Title II, Section 903*).                                   |
|                                                                       |
| There is a subtler problem with the FairTax sales tax rate. FairTax   |
| declares an initial rate of 23% (*FairTax, Title II, Section          |
| 101(b)(1)*), but after 2003 the sales tax rate will be the sum of the |
| declared general revenue rate (14.91%); the old age, survivors and    |
| disability insurance rate; and the hospital insurance rate (*FairTax, |
| Title II, Section 101(b)(2)*). The first rate is currently 6.2% and   |
| the latter is 1.45%. In other words, after 2003, the national sales   |
| tax rate would be 22.56%. But notice that with an increase in any of  |
| those rates, the national sales tax rate also increases. With the     |
| current Social Security and Medicare mess, which Congress has         |
| repeatedly failed to adequately address, what do you think will       |
| happen to future national sales tax rates?                            |
|                                                                       |
| FairTax essentially places the burden of proof on all accused         |
| (*FairTax, Title II, Section 506*). That is, any person *merely*      |
| accused of failing to pay a tax will be guilty until proven innocent. |
| As with the income tax, here we go again! Burden of proof must be on  |
| the government. Period. Worse, FairTax maintains one of the most      |
| invasive features of the current tyrannical income tax: the authority |
| to summons, and to conduct examinations and audits (*FairTax, Title   |
| II, Section 508*).                                                    |
|                                                                       |
| NESARA provides a simple, straightforward [administrative             |
| process](http://nesara.org/bill/part2a07.htm) in tax disputes. Under  |
| NESARA, should the National Tax Service (NTS) believe a tax has not   |
| been paid, the NTS merely prepares a statement of the alleged taxable |
| activity and issues an Assessment/Preliminary Notice of Deficiency    |
| ([NESARA, Part II, Section 7](http://nesara.org/bill/part2a07.htm)).  |
| That's all that is needed and the burden of proof stays where it      |
| belongs---on the government. Should an alleged taxpayer desire to     |
| dispute the alleged tax, the alleged taxpayer can certainly introduce |
| their books and records as evidence to quash the allegations, but     |
| nowhere does NESARA authorize the tyrannical practice of continuing   |
| the madness of issuing summonses and conducting examinations, audits  |
| and fishing expeditions. Such practices are tyranny and invasions of  |
| privacy.                                                              |
|                                                                       |
| FairTax states that government purchases are subject to the sales tax |
| (*FairTax, Title II, Section 102(a)(3), Section 703*). That makes no  |
| sense. Every time the government buys something, it taxes itself, and |
| pays itself the revenue? Such a ploy is a facade, only circulating    |
| currency in and out of government coiffures. There is no net effect   |
| of such a maneuver except added administrative costs. Why pay the     |
| cost of all that extra accounting and paperwork? Isn't the national   |
| sales tax supposed to reduce paperwork and administrative costs?      |
| NESARA exempts all sales to the United States government ([NESARA,    |
| Part II, Section 5(C)(1)](http://nesara.org/bill/part2a05.htm#c)).    |
|                                                                       |
| FairTax allows for withholding of income for non-resident aliens      |
| (*FairTax, Title II, Section 905*). So much for the so-called         |
| abolishment of the personal income tax. Expect the same confusing     |
| arguments about vague terms such as gross income.                     |
|                                                                       |
| FairTax, H.R. 25, is a terrible start, and we can do better. Much     |
| better. NESARA not only provides fiscal policy reform, but monetary   |
| policy reform ([NESARA, Part                                          |
| I](http://nesara.org/bill/bill_main1.htm)). With NESARA, the          |
| purchasing power of the currency will stabilize. FairTax has no such  |
| provisions.                                                           |
|                                                                       |
| FairTax also provides no relief from current banking laws ([NESARA,   |
| Part I, Section 7](http://nesara.org/bill/part1a07.htm)).             |
|                                                                       |
| Both FairTax and NESARA are designed to be revenue neutral. That      |
| means neither bill changes the current income and outgo of revenues   |
| collected. Other than that similarity, the differences between NESARA |
| and FairTax are obvious.                                              |
|                                                                       |
| FairTax addresses only symptoms, not root causes. The bill continues  |
| the intrusion of government into our private lives. FairTax is        |
| regressive in nature because not all households will qualify for      |
| rebates, and the bill contains no provisions to resolve the root      |
| problem, an ***unsound monetary system*** ([NESARA, Part              |
| I](http://nesara.org/bill/bill_main1.htm)). Tax reform is a good      |
| start, but ultimately ***futile*** without monetary reform. NESARA    |
| solves both problems.                                                 |
|                                                                       |
| NESARA is built upon the foundations of life, liberty and property,   |
| does not unduly tax the necessities of ***life*** and does not        |
| support intrusions into private lives. NESARA was written from within |
| the grass roots of America, not by special interests. That's why      |
| NESARA will work. FairTax is ***not*** the answer.                    |
|                                                                       |
| [Read H.R. 25 on                                                      |
| line](http://thomas.loc.gov/cgi-bin/query/z?c108:H.R.25:).            |
|                                                                       |
| [Go to the comparison                                                 |
| chart](http://nesara.org/comparisons/tax_comparison_chart.htm)        |
|                                                                       |
| [Send a letter to your representatives Voicing Opposition to H.R.     |
| 25](http://nesara.org/political_contacts/letter_25.htm).\             |
|                                                                       |
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