A Better Way For The USA
If you are like me, you would rather be sitting in a dentist’s chair than to read a book about taxes - except for this book. Reading as an ordinary taxpayer and not as a financial professional, I had no difficulty understanding the concepts presented by authors Neal Boortz and Congressman John Linder. Please do not let the subject matter discourage you. If I can understand a book written on the “exciting” subject of taxes, anyone can. Given the subject matter, "The Fair Tax Book" is clearly and concisely written. After reading this book myself, I recommend all taxpayers who feel our current system of tax collection can use a bit of improvement read "The Fair Tax Book". After reading it, you may not agree with the plan presented by the authors, but it may encourage you to consider whether or not we, in the U.S., can improve our current method of funding the government and eliminate the bullying tactics of the Internal Revenue Service.
My Job Has Me Driving
Although you will not find me reading “The Wall Street Journal” or “The National Tax Code” on a regular basis, my interest in this book was piqued while listening to a local talk radio station while “on the road”. The show featured a discussion between a number of national figures. This book, a New York Times #1 Best Seller, was mentioned during the discussion. That is also where I learned it was written by Neal Boortz, a nationally syndicated talk show host and attorney, and Congressman John Linder (R-Georgia) who has been introducing the Fair Tax Bill in Congress since 1999.
The book outlines a viable and practical plan to eliminate the IRS and the national income tax. According to Boortz and Linder, our current income tax system is governed by 60,000 pages of regulations. Additionally, each of us probably has experienced or heard horror stories of audits, penalties, and grossly unfair IRS decisions. The average American spends 27 hours per year completing the paperwork required by our system to “request” that the IRS return money we earned and they collected. On the national level, it is estimated that 5.8 billion hours are spent in complying with tax codes at a cost of $194 billion. Can we stop this runaway bureaucratic train? After reading "The Fair Tax Book" which presents a simple and fair plan of funding the government without placing an undue burden on any given segment of the population, I believe we can.
The Book’s Layout and Plan
The authors begin with a brief history of how our system of income tax and withholdings was developed. Either I was sleeping the day they taught this in Civics Class or it was not taught at all. I believe the latter to be the case. After the brief history lesson, an explanation of “embedded taxes,” which are taxes “built into” the price of every item we purchase, is given. This was the first time I had given serious thought to the amount of tax that is added to the price of an item at every stage of production until it makes its way to the consumer.
The heart of the book is, of course, the explanation of how the Fair Tax Plan, as presented by Congressman Linder, is designed to work. The plan calls for the elimination of the income tax as well as all other Federal taxes. With these taxes eliminated, all employees would receive 100% of their paychecks. Without going into the exact mechanism, the competitiveness of the free market economy would automatically remove the amount of previously embedded taxes from the price of consumer goods. These embedded taxes, according to the Fair Tax Plan, would then be replaced by a national sales tax of nearly the same amount. Only new consumer goods would be taxed and no taxes would be collected on used items. Since individuals would decide when and what items they wish to purchase, the tax becomes voluntary.
Another aspect of the plan is the development of a “prebate” to be paid to each household on a monthly basis to cover the estimated amount of sales tax that would be paid on the basic necessities of life. The amount of the prebate would be based on government-defined poverty levels for various sized households. Amazingly, as outlined by this plan, even after the rebate is paid approximately the same amount of revenue would be generated as is presently collected.
A major asset of the tax plan outlined in the book is moving a segment of the population not currently paying income tax into the system. Because taxes would not be withheld from legally earned paychecks but paid in the purchase of consumer items, those who do not now pay tax on their income would be forced to pay during the purchase of these items. Such newcomers to our tax base would include illegal immigrants, drug dealers, cash-only services, and others who now “earn” money but do not pay their share of expenses.
Yet another plus outlined in "The Fair Tax Book" is the elimination of the incentive for companies to move capital offshore to avoid a myriad of taxes. This would, in fact, make the U.S. more attractive for international companies to do business here.
Finally, the authors have included a helpful chapter near the end of the book which proposes answers to the questions and objections that have been raised about the plan. The book ends with a final chapter on what each of us can do to make the Fair Tax Plan a reality.
Why I Recommend This Book
This book provides a plan for a more equitable alternative to our current tax system that would relieve the stress so many of us feel at tax time. There would be no reprisals (penalties, interest, or prison) against individuals who failed to pay their taxes in a timely manner. This is valuable information for all taxpayers.
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