FairTax Overview
The U.S. Tax System under the FairTax
Sold in U.S. market
Sold in foreign markets
U.S. production
Pays the FairTax.
Pays foreign value-added tax
Foreign
production
Is exempted from the source country Pays foreign value-added tax
VAT, but pays the FairTax
Conclusion
Only the FairTax plan can claim that under its regime, foreign manufactured goods and U.S.
manufactured goods will pay the same tax when the goods are sold at retail.
Only the FairTax can make the claim that U.S. businesses selling goods or services in foreign markets
will be fully relieved of federal tax (including payroll taxes).
What is the FairTax Plan?
The FairTax Plan is a comprehensive proposal that replaces all federal income and payroll based taxes with an
integrated approach including a progressive national retail sales tax, a prebate to ensure no American pays federal
taxes on spending up to the poverty level, dollar-for-dollar federal revenue replacement, and, through companion
legislation, the repeal of the 16th Amendment. This nonpartisan legislation (HR25/S13) abolishes all federal
personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare,
and self-employment taxes and replaces them with one simple, visible, federal retail sales tax – administered
primarily by existing state sales tax authorities. The IRS is disbanded and defunded. The FairTax taxes us only
on what we choose to spend on new goods or services, not on what we earn. The FairTax is a fair, efficient,
transparent, and intelligent solution to the frustration and inequity of our current tax system.
What is Americans for Fair Taxation® (FairTax.org)?
FairTax.org is a nonprofit, nonpartisan, grassroots organization solely dedicated to replacing the current tax
system. The organization has hundreds of thousands of members and volunteers nationwide. Its plan supports
sound economic research, education of citizens and community leaders, and grassroots mobilization efforts. For
more information visit the Web page: www.FairTax.org or call 1-800-FAIRTAX.
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