Flat/ fair tax

Hi

Perhaps we should discuss what is exactly a flat tax. Legally speaking there is a difference between the two but for our purposes we can consider them similar. I may use the terms interchangeably so please bear with me.

Under a flat tax system there is a very simplistic method of computing the tax. One rate and no deductions.

Take an example of a person who works for $20 per hour and works for 8 hours. He/she would get 8 times $20 or $160 dollars pay. Under our current system of taxes we deduct FICA, Medicare and Federal withholding. The result is that the net check is less than the $160 earned. The taxpayer is ahead, but wait - who pays for NEEDED government services. When our person buys a product or service he pays an addition sum, the flat tax. The manner of computing this tax is to multiply the tax rate times the purchase price of what was bought. At first reading it appears that the tax is a burden because it raises the cost of goods, but here is the solution. Because the employer, the distributor and the manufacturer do not pay all the add on (FICA, Medicare, etc) the cost of the goods are lowered. The party collecting the tax also saves on hiring overhead people such as bookkeepers and accountants who are needed under our current system. He passes this savings on in the form of lower prices. Every body wins.

In future writings I will go into more advantages so please keep reading. Thank you.

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GOD Bless