Dear Mr. President:

America is currently plagued by the problem of joblessness, and in spite
of your best efforts, little, if any, progress is being made. Other
countries, such as China, Japan, Korea, and others seem not to have this
problem to the great extent that the US has. Americas retail shelves are
stacked with cheaper foreign goods that have driven American
manufactured goods out of the market. Americans no longer provide many
services in the US because they have been outsourced to foreign
countries such as India because labor costs are much cheaper there.

Methods of taxation in other countries also contribute to the American
unemployment problem. Most Americans do not realize the Europeans,
Australians and Canadians (with their GST-Goods and sales tax), and
countless others with a VAT (Value Added tax) have had a discriminatory
tax on American goods and services for decades! This discriminatory tax
is 15 to 25% in Europe.

It works like this; every business has many costs, one of which is taxes
(payroll, tax on profits, etc.). In the US these costs, like all other
costs, are included in the prices of our products, but we don\'t itemize
(clearly show) the specific increment that is taxes. When we ship that
product to Europe, etc., they add the VAT to the already tax laden
American product.

Companies in the VAT countries, like American companies, have to pay
taxes, but they keep track of the taxes as the product proceeds through
the production process. They call the incremental taxes VAT. When the
product is put on the retail shelf in Europe, etc., it includes the VAT,
and the VAT is revealed to the customer.

Now it gets interesting: when a tax laden American product (about 22% on

average) is put on the shelf next to the EU product, in Europe, the VAT
is added to the American product. Now the American product is 20+% more
expensive than the comparable EU product! Guess which one sells? Talk
about a stacked deck.

Conversely, when the EU product is exported, they remove the VAT! When
that EU product is exported to the US, it sits on the retail shelf in
the US with no taxes included right next to the American product with
all the taxes included! So, once again, the American product is 20+%
more expensive than the comparable EU product, and on our own shores!
Guess which one sells this time? You better believe it.

We have put up with this nonsense for decades, while we debate tariffs
on foreign steel and other like products produced domestically in the
US. If some of our domestic industries are to survive they need
protection from foreign competition. Tariffs and other protectionism
measures have proven to be an unsatisfactory solution to protecting our
domestic job market (because other countries retaliate). The
Smoot-Hawley tariff act of 1930 was enacted to protect the American
farmer from competition from much cheaper imported farm products. It
represents the high-water mark of US protectionism in the twentieth
century, and it precipitated negative results (retaliation by other
countries).

Why have I told you all this? Because there is a plan ready to go that,
when enacted into law, will produce the kind of super-rapid economic
growth and new job creation that is sorely needed\.....plus will
generate many additional good results for our nation! It is H. R. 25,
the Fair Tax Act of 2003. This bill has bipartisan sponsorship,
widespread support among the hardworking, taxpaying voters, and fast
growing support within the House of Representatives and Senate (over 45
cosponsors).

The Fair Tax will produce these highly desirable results:

\*Our nation will enter a period of many years of sustained economic
growth with new job creation unequaled by anything in our history.

\*The Fair Tax will bring back a measure of fairness and freedom to
America that has been trampled-upon by the Income Tax System (and IRS)
for many, many years.

\*Receipts from the Fair Tax will be more than sufficient to fund the
Social Security System and Medicare plus enable the government to meet
its needs and steadily paydown the national debt.

The Fair Tax draws on a much larger tax base (our GNP, gross national
product each year, when it is sold) than does the income tax; virtually
no one will be able to evade paying at the \"check-out\" counter. This
will lighten the load for all of us. Under the Fair Tax the \"sticker
price\" of all that we buy will fall 20-30%. So, even with the 23% Fair
Tax added on, the cost of living would be no more than it is now, more
likely less. Most importantly, we would all be shopping with our gross
paycheck.

The Fair Tax will:

\*Replace the current complex and unfair federal tax system with a
simple sales tax.

\*Eliminate personal and corporate income taxes and Social Security,
Medicare, gift and estate taxes.

\*Save taxpayers an amount estimated to be between \$250-600 billion
wasted in complying with the current tax code.

\*Lower \"sticker\" prices 20-30% by removing the cost of business
compliance with the current tax code.

\*Make American products more competitive with foreign products. Thus,
hurling American manufacturing levels to dizzying heights not seen
within recent memory.

\*Provide a more stable revenue source and raise the same amount of
money for the federal government with the imposition of a 23% sales tax
with no loopholes.

\*Dramatically lower tax rates for lower and middle income Americans by
pre-bate payments to households to offset the sales tax on necessities.
(To be mailed from the Soc. Sec. Administration an organization easily
equipped for the task).

\*Protect and ensure the funding of Social Security and Medicare.

\*Repeal the 16th Amendment and eliminate the Internal Revenue Service.
Taxes on income will no longer be constitutional.

\*Bring capital investment flooding onto American shores. Businesses, no
longer being taxed, will enjoy America as the most: business-friendly\"
nation on earth.

The current 7 million word tax-code requires 1168 pages (2 volumes) to
publish, and an additional 6,439 pages of Federal Tax regulations that
apply to income taxes. The IRS has created 480 tax forms with an
additional 280 to explain how to fill out the 480. More Americans work
in tax compliance occupations (CPA\'s, Tax Attorneys, etc.) than serve
in the entire US Armed Forces. The IRS is twice as big as the CIA and
five times as big as the FBI. The compliance costs dwarf the amount of
the tax collected. In addition to that, the IRS spends a yearly \$9
billion budget. The total national cost of compliance (not counting the
taxes paid) is \$250 billion yearly. That\'s \$850 per capita of US
population.

The Fair Tax reform proposal, which may be fully understood at the
website [[www.fairtax.org]{.underline}](../www.fairtax.org)
\<[[http://www.fairtax.org/]{.underline}](http://www.fairtax.org/)\> is
the best alternative to replace the IRS. It is a simple (retail only)
national sales tax. It is not a VAT (value added tax\-\--applied at
every level of the production process). Business-to-business
transactions, not being retail, are not taxed. Nothing is deducted from
the employee\'s paycheck. He has to spend it on new goods only, not used
goods, for it to be taxed. Thus, one is in charge of one\'s own \"tax
destiny.\"

The individual person is allowed to spend the first \$8,860 of his
yearly income tax-free (he will get monthly reimbursement checks (in
advance) for taxes paid on that amount), \$17,720 (for a couple),
\$20,800 (household of 3), \$23,880 (h.h. of 4), \$26,960 (h.h. of 5),
\$30,040 (h.h. of 6), \$33,120 (h.h. of 7, \$36,200 (h.h. of 8).

Under this system, \"sticker\" prices would fall 20-30%, thus, giving
our exports a much better competitive edge when sold abroad. This would
\"kick\" the economy into high gear. Businesses (no longer having to
send the IRS any money at all) would simply pass the savings on to the
consumer, their shareholders, and their employees as higher wages.
Forty-five of the fifty states use a sales tax to generate revenue
because they know that it is the fairest, simplest, easiest, most
cost-effective, most problem free method of taxation. The state taxing
authority in each state would assume the duty of collecting the national
sales tax for the US government. Only the retailers file a tax return
(it merely declares the amount of their sales for the year). For
everyone else, April 15 is just another spring day.

Each taxpayer gets a monthly pre-bate check in the amount taxed on his
spending up to the poverty line. So, in effect, he is only taxed on his
spending above the poverty line. In no case will anyone sacrifice more
than 23% of his total income to the sales tax, even if he spends all of
his income on retail purchases.

Unspent income remains tax-free and available for investment or
education expenses. Compliance cost of administering the Fair Tax is
only \$8 billion yearly. That is a huge savings compared to the \$250
billion we now pay. The IRS, with all the taxpayer support services that
it has made necessary, is intolerably burdensome and expensive.

When visiting the Fair Tax website, please don\'t stop with the first
frame. Click on each of the major headings for more complete
information. It will take awhile for your staff to do this, but it is
the only way to get the complete picture.

See also
[[http://www.geocities.cmcofer/compare.html]{.underline}](http://www.geocities.cmcofer/compare.html)

\<[[http://www.geocities.cmcofer/compare.html]{.underline}](http://www.geocities.cmcofer/compare.html)\>
and
[[http://www.geocities.com/cmcofer/fca3.html]{.underline}](http://www.geocities.com/cmcofer/fca3.html)

\<[[http://www.geocities.com/cmcofer/fca3.html]{.underline}](http://www.geocities.com/cmcofer/fca3.html)\>

America, producing an endless supply of high quality, competitively
priced goods and services, will have a behemoth-size trade surplus.

An ever-expanding economy will shift the balance of payments in favor of
the US. America will be a lender to many, a debtor to none. There will
be jobs and income for all who want to work

Please put the power of your office behind this legislation and the
millions of people who have already committed to this task will do all
we can to help. Wholeheartedly support House Resolution #25\-\--the Fair
Tax reform proposal as a curative solution to relieve the American
people of the tyranny of our present tax system (income tax-IRS) and put
Americans back to work. Wouldn\'t that be a great legacy to leave the
American people.

Thank you for your time and attention to this vitally important matter.

Respectfully Yours,

Harry R. Hahn

St. Louis, MO