From a Student of Tax - Reader comments at The New York Sun

Reader comment on:
On Taxes, Huckabee Leads
in response to reader comment: Mike Huckabee's Fair Tax reform issue

Submitted by Jeff Gillingham, Dec 8, 2007 18:09

Sir,

I am also a Texan (by way of UT Austin) and am a large supporter of Mr. Huckabee and his fair tax proposal, as well as the no-income tax policy of the state of Texas. I don't mind an extra little bit of tax on goods I purchase - I much prefer it to spending time filling out a state income tax return (and I'm not making interest free loans to Texas by way of withholdings).

Your calculation of the fair tax is incorrect though - it is actually a 30% charge on the price of the good - not 23%. I believe this is misleading and has been a major criticism used by opponents of the fair tax. I wish fairtax.org would change their calculation method. The $1 good becomes $0.78 after the removal of imbedded tax, then the 30% tax is put on top of that price, making it $1.01. Fair taxers call it a 23% sales tax because .23 (1.01 - .78) is approximately 23% of 1.01.

As a master's student of accounting at UT Austin, I am amazed at how complex the federal government has made the tax system. I spend tens of hours researching and writing each tax memorandum for my tax research classes, and believe it is all a big waste of time (and my tuition). If fair tax passes, it will save American's approximately 6 billion hours per year preparing their federal income tax returns, rid ethical American's of bearing the brunt of nearly $290 billion of tax evaded dollars, save corporate America billions of dollars in professional tax service fees (meaning lower costs for you and I), rid ourselves of the $10 billion a year IRS (which will be replaced by a smaller monitoring agency to ensure corporations are collecting taxes on sales), and give all Americans, young and old, a major incentive to save and invest for their future wants or needs (ie. education, a home, a vacation) because they won't have to file tax returns.

-Jeff G

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Reader comment on:
On Taxes, Huckabee Leads
in response to reader comment: Mike Huckabee's Fair Tax reform issue

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Reader comment on:
On Taxes, Huckabee Leads
in response to reader comment: Mike Huckabee's Fair Tax reform issue