But some day, he or his descendants will spend his profits, and taxes will be collected. At the same time, those less fortunate will receive a rebate lowering their total tax bill and effective tax rate, even if they don't save a nickel. This is a system all Americans can understand and be united behind and voluntarily pay. The tax system would achieve greater enforceability with less intrusiveness. No single industry is more burdened by the multitude of state and Federal tax laws than retailers.
Retailers are today both tax collectors and taxpayers.
Under the FairTax, there will be no more uniform inventory capitalization requirements, no more complex government rules on employee benefits and retirement plans, no more tax depreciation schedules, no more tax rules governing mergers and acquisitions, and no more international tax provisions. While respected economists haggle over the dimensions of the economic benefits, they are unanimous in their view the FairTax would greatly enhance economic performance by improving the incentives for work and eliminating the current bias against saving and investment. Even the National Retail Institute's study by Nathan Associates shows that the economy would be one to five percent larger under a sales tax than in the absence of reform. I appreciate the opportunity to speak before this subcommittee today, and I would be happy to answer any questions that you might have.