Will President Trump sign into law H.R. 25, the Fair Tax?

Donald Trump said this during his acceptance speech in Cleveland:

Next comes the reform of our tax laws, regulations and energy rules. While Hillary Clinton plans a massive, and I mean massive, tax increase, I have proposed the largest tax reduction of any candidate who has run for president this year, Democrat or Republican. Middle-income Americans will experience profound relief, and taxes will be greatly simplified for everyone. I mean everyone. 

America is one of the highest-taxed nations in the world. Reducing taxes will cause new companies and new jobs to come roaring back into our country. Believe me. It will happen and it will happen fast. [Emphasis added]

Former Congressman, current Indiana Governor and Vice Presidential nominee, Mike Pence responded to a question about the FairTax resolution H.R. 25. The question was asked during a Town Hall forum in Anderson, Indiana, on April 16, 2009. Here Pence’s response:

Dave Leake a supporter of H.R. 25, the FairTax notes:

[W]hile speaking off the cuff, Pence got a couple things not quite right, and also failed to mention some important stuff. The government rebate (“prebate” as FAIRtaxers call it) would be paid every month, not quarterly. And, for every legal family of three, it would amount this year to $6,417, paid in monthly increments of $535. The size of the prebate is solely determined by family size, NOT on what you spend or earn.

That prebate does not include the pay raise for every family. That pay raise will be equal to every dime taken right now from your pay for income taxes, payroll tax, and FICA.

To learn more about the FairTax visit: FairTax.org/FAQ, FairTaxNation.com or FLFairTax.org

The FairTax Act of 2015 reads:

This bill is a tax reform proposal that imposes a national sales tax on the use or consumption in the United States of taxable property or services in lieu of the current income and corporate income tax, employment and self-employment taxes, and estate and gift taxes. The rate of the sales tax will be 23% in 2017, with adjustments to the rate in subsequent years. There are exemptions from the tax for used and intangible property, for property or services purchased for business, export, or investment purposes, and for state government functions.

Under the bill, family members who are lawful U.S. residents receive a monthly sales tax rebate (Family Consumption Allowance) based upon criteria related to family size and poverty guidelines.

The states have the responsibility for administering, collecting, and remitting the sales tax to the Treasury.

Tax revenues are to be allocated among: (1) the general revenue, (2) the old-age and survivors insurance trust fund, (3) the disability insurance trust fund, (4) the hospital insurance trust fund, and (5) the federal supplementary medical insurance trust fund.

No funding is allowed for the operations of the Internal Revenue Service after FY2019.

Finally, the bill terminates the national sales tax if the Sixteenth Amendment to the Constitution (authorizing an income tax) is not repealed within seven years after the enactment of this Act.


7 replies
  1. Mark Curran
    Mark Curran says:

    Sorry, Pence wont do anything on Fairtax, because he would be ashamed of the fraud he pushed with Fairtax. Just a “few” details Pence “forgot” to mention to folks — massive taxes on every city and county in Indiana (every state, too).

    All wage expenditures, all pension expenditures, all capital expenditures, all operational expenditures, virtually any and all “expenditures” by all city county and states, are taxed 23%. Indianapolis itself would owe over 120 million dollars. Marion County Indiana would owe even more – over 140 million.

    Tiny Richmond Indiana would owe over 12 million.

    Why are all these massive other taxes in the Fairtax fine print? To make their math work.

    In fact, these other taxes (the ones Pence and others dared not mention) are the biggest part of Fairtax.

    Yes, they do tax retail sales, that’s not the problem.

    The problem are these massive other taxes- – and the biggest other taxes are the taxes on city county and states, much of it in advance. Yes, ADVANCE.

    You need to read all the fine print in Fairtax. I doubt you have. But it’s there — check HR25, and then read carefully the “supporting documents” or “official research” by Fairtax hustlers (yes they are) themselves. They do write cleverly, so you have to read closely, and check their math with that same closeness.

    But as President Bush Tax Panel exposed over a decade ago, if you only taxed personal retail sales (and not the massive other taxes in Fairtax fine print) the tax rate would be 89%.

    I was fooled by this — the slogans were great. But I got very curious about a few statements in Fairtax Book by Boortz. He briefly mentioned taxes on government, and made it seem like they would just pay retail taxes too, which is not a big deal. But I wanted to see the fine print, I wanted to see where that was articulated in HR25.

    I found it, and found the clever other documents they call research.

    The reason Pence won’t push Fairtax –it sounds great. But once city county and states learn they would owe collectively over a trillion dollars, and once they learn Fairtax documents actually state they “assume” all city county and states will “raise their tax rates sufficiently” to pay this, Pence would not be welcomed in any city in the state, any county.

    By the way, I was fooled by Fairtax absurd claims of 88 economist who developed it, and the 22 million in research. I chased that down — I could not find anyone, other that one guy at Beacon Hill (fairtax hired Beacon Hill to put out the goofy but clever fine print) who even knew about these massive other taxes. There is no research whatsoever about these massive other taxes, other than the absurd “assumption” in their “research” document that all city county and states will pay them, and then raise their tax rates to recoup the costs.

    SO there are no “economist” who developed this. In fact the guy Neal Boortz named as the main researcher from Harvard, never researched Fairtax at all on these goofy massive other taxes, and himself claimed Fairtax would not work. He did not support Fairtax at all, but clever editing and half truths can make it seem so.

    Still, I would love — love — to pass Fairtax. It would be hilarious.

    I would love to see Pence explain to Indianapolis that they need to pay 140 million dollars, and Marion County even more, and explain to every park district, every library district, every police department, every fire department, that they owe 23% tax on all their expenditures. Not just retail purchases — which would be paid at the cash register- – but these are other taxes, paid separately, and IN ADVANCE per Fairtax footnote.

    Even the federal government – no, really — would be liable for these massive expenditure taxes. Yes, it’s goofy as H to tax all city county and states, and of course Fairtax knew that, which is why they were slick as spit to get it in the fine print. And why they never told anyone candidly.

    So — don’t get made at me you were fooled. Get mad at the liars who fooled you.

    ANd maybe next time, learn something before you teach it. Feel free to contact me at mybookwork a yahoo email.

  2. Jim Duncalf
    Jim Duncalf says:

    Mark you have a very narrow view of the potential impact of the Fairtax system. The first impact that it would have is to cause trillions of offshore dollars to come back to the states and into the banks. Monies which could be used to fund local industries and business. Secondly it would remove the enormous tax burden that the income tax places on every item that the US exports, drastically lowering the cost of every item we make for export. A tax burden not shared by many of America’s industrial competitors. Thirdly, it would remove the disincentive to be successful. If you could actually keep all the money you make and not feel victimized for working harder and making more money. But perhaps the most important thing it would do is something my grandfather said about how the Income tax law effected America. The income tax changed our public servants into slave masters who loved to hate, envy and punish us. It perversely impacted our right to “Life, Liberty and the pursuit of Happiness”.

  3. Franz Meier
    Franz Meier says:

    The Fair Tax will never pass! It is too fair and too simple and it will punish the high income people. The Fair Tax is a moral tax, because the taxpayer decides when he pays, which is when he spends his earnings. But most importantly, the power hungry politicians will never give up their ability to use force when the sheep don’t follow!

    • Dr. Rich Swier
      Dr. Rich Swier says:

      President Trump with the 20% border tax proposal appears to be moving toward a tax on consumption rather than productivity. This is the first step toward implementing the Fair Tax.

      Border tax, simplification of current tax codes, cutting individual and corporate taxes. These all are leading to a national sales tax.

      • Charles White
        Charles White says:

        With all of the controversy the Fair Tax code creates among We The People, why not implement Fair Tax for a trial period. It seems that paying taxes on goods once would be fair for all assuming the tax rate is set evenly across the board!

  4. Heather
    Heather says:

    In order to pass the fair tax, people must understand the income tax. It doesn’t apply to mist to begin with. It operates outside jurisdiction of the 50 states, only applies to Gov. PRIVLEDGE, only applies to foreigners who you hold income for. That’s it. The code is very simple. If you aren’t any of the above..you simply don’t owe!


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