Original sentence: However, for taxes such as the FairTax proposal that are not withheld and reported by an independent third party to the government, evasion rates rise to 30 percent or more
Edited sentence: Focusing the same resources that currently monitor 170 million taxpayers on only two million taxpayers should result in virtually zero evasion in this 85% base.Hence, even if the other 15% of retailers completely evaded the FairTax, the 23% FairTax applied to only these retail sales would raise more revenue than all existing Federal Taxes.However, for taxes such as the FairTax proposal that are not withheld and reported by an independent third party to the government, opponents claim evasion rates rise to 30 percent or more.In the United States, 85% of Retail Purchases are made at only 15% of Retail businesses.In this way, savings that were tax-deferred under the Income Tax in IRA and 401K or other plans will see a large benefit under the FairTax.The FairTax requires each receipt to declare the tax paid.The significant difference between a VAT and a Retail Sales Tax is the lower compliance cost to all of the businesses along the supply chain due to collection only at the final retail sale.These two parties will have to trust each other before engaging in evasion.This 85% of retail sales represents $10 trillion of the $12 trillion economy.This could be mitigated to some extent by a reporting mechanism which compares the retail sales amount and the business inputs to that retailer.This equates to just two million businesses to be monitored by the collection agencies.This is similar to the evasion that occurs under the income tax when a business owner uses his business to purchases personal items but expenses them to the business.This means evasion requires two parties -- the seller and the buyer.This money will be taxed only once when spent.This would ensure the retail sales exceeds the business inputs or trigger an audit by the state Sales Tax authority.Under the Income Tax system, it would have been taxed once when withdrawn and a second time to pay for the embedded taxes in the goods and services purchased.Under the income tax, it only requires one party to evade by failing to declare all income