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FAIRTAX FRIDAY & CHAIRMAN’S REPORT – MARCH 24TH, 2017

THE FAIRTAX WILL COLLECT MOST OF THE $9 TRILLION OF EVADED FEDERAL TAXES
 
The Cebula Study concludes that evasion under the present income/payroll tax system will likely exceed $9 trillion in the next ten years.  This is an astounding number!
 
An extra $9 trillion—what a difference that would make for all of us.  Last week we discussed the impact of an extra $9 trillion on the U.S. budget deficits and total debt.   If not needed to address budgetary issues, then the money could be allocated to furnish funds for:
  • A complete refurbishment/replacement of our deteriorating infrastructure; and/or
  • Genetic research that will more rapidly find and make available the cures for the health maladies that plague so many of us and our families and greatly reduce not only suffering but one of our biggest budget items; and/or
  • The more rapid development and implementation of alternative energy sources and greatly reduce the cost of energy; and/or
  • Exploration of space; and/or
  • Provide school choice vouchers and/or scholarships to millions of young people; and/or
  • Actually set aside a fund for Social Security and Medicare instead of unfunded government promises. 
The point is that additional funds give many options.
 
Reasons Why Evasion Will Be Less Under The FAIRtax
  1. Do the Math.  JCT estimates the total number of tax returns for 2017 to be 174.2 million.  Under the FAIRtax individuals will not have to file returns; they pay taxes when they purchase something.  Only businesses selling at retail will collect the tax and file returns— at absolute most this would be 36 million, a 79% reduction.  
  2. Opportunity.  One of the reasons that retail sales taxes are evaded at much lower rates than income taxes is that over 90% of retail sales in this country are made by less than 10% of the retail establishments that have elaborate accounting and inventory controls.  Try going to Walmart and telling the clerk not to charge you sales tax.  If the other 90% of retail sellers evaded 100% of the taxes owed, the evasion rate would still be less than 10%.    For the reasons explained below, this will not happen.
  3. Automobile Licensing.  For most of us, next to our residence, the largest purchase we make is an automobile.  Sales taxes are collected In order to get the automobile licensed.
  4. Wholesale Purchasers Either Pay the FAIRtax or Have a Registered Seller Certificate.  Persons purchasing goods or services for business purposes must pay the FAIRtax, unless they present a valid Registered Seller Certificate at the time of purchase.  This creates an auditable record of the untaxed transaction.  A State of California study on sales tax evasion found a 5.5% retail sales tax evasion rate, half of which is unpaid use tax—tax on goods purchased from vendors outside of the state but used and consumed in the state, thus taxable.  Much of the upaid use tax was for business purchases which are not taxable under the FAIRtax.  Excluding these non-taxable transactions reduces the evasion rate from 5.5% to 4.​7​%.  Further reducing the magnitude of evasion is the fact that the FAIRtax is a simple tax on all consumption which can be understood by anyone. 
  5. Administration by State Taxing Authorities.  California and the 44 other states that collect retail sales taxes have been collecting and enforcing sales tax for over 40 years.  They have been accumulating data from a wide variety of retail businesses and have created models which give reliable estimates of what should be paid in sales tax based on the goods purchased for resale.  This allows them to quickly find and audit sellers who the model demonstrates are not paying the correct amounts of sales tax.  The burden on the store owner is to show why they don’t owe the sales tax because of theft of their inventory, spoilage of their inventory or that the untaxed inventory is still in stock.  It is not a question of intent but simple fact, resulting in assessments of tax and penalties that make any significant evasion very unappealing.  And given the simplicity of the FAIRtax, it will be extremely difficult to make the case that “I didn’t know.”
  6. Criminal Liability.  Under the income tax you are not committing any crime by paying cash to a vendor in exchange for goods or services.  It is up to the recipient of the cash to report it as income for federal and state tax purposes.  Under the FAIRtax, if you are purchasing the retail good or service, you will know that it is subject to the FAIRtax.  If the FAIRtax is not charged, then you will be committing tax evasion.  Since most of the opportunities to avoid the FAIRtax will be for smaller amounts of tax, is someone going to be willing to put themselves at a risk of fines or criminal charges?  If the vendor of the service is discovered, his records will be audited  and in many cases, the identity of his fellow conspirators to evade the FAIRtax will become known and the evaders can all be criminally prosecuted.      

     
Guilt Easily Established.  It is often difficult for the government to criminally prosecute income/payroll tax evaders because intent has to be proven in order to get a conviction.  However, evasion of the FAIRtax establishes intent when you choose to make the purchase without paying the FAIRtax.

CONCLUSION
When we pay “cash” and get a discount because the person is not paying federal or state taxes on the money, our price savings is really being paid by the rest of the taxpayers who are paying the proper taxes.  It is stealing from our fellow citizens—no matter how justified it may seem. The solution is not to create an army of additional IRS agents who will harass all taxpayers, the roughly 20% of tax evaders and the rest of us, but to go to a better tax system—the FAIRtax.Please contact your Members of Congress and ask them how they propose to deal with the $9 trillion of evasion under the income/payroll tax.  Ask them if it is fair to continue a system that forces the rest of us to pay for tax cheats?   Ask them why it would not be smarter to go to the FAIRtax?  Please send us the answers you get.    

HELP BRING ABOUT REAL TAX REFORM AND STOP FUTURE IRS ABUSES

Abraham Lincoln also said, “Things may come to those who wait, but only the things left by those who hustle.” 

We may only have a limited time to stop the fake tax reform being promoted by some in Congress.  If it passes, then the Elites will say that we need to wait before we consider any more changes.  To stop this fake reform, we must be able to ensure that our message is clearly heard not only by Congress but also by President-elect Trump.  To do this we need your help.

By contributing (investing) $10.40 per month, you help provide a financial base to AFFT.  If you can make larger contributions (investments), these will be used not for salaries, as we are all volunteers, but for the needed updates to our economic studies which will be vital in 2017.
 
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FAIRtax E-Book 
AMERICA’S BIG SOLUTION - An E-book For Beginners

Some people would like to learn about the FAIRtax outside of social media.  Yes, there is life beyond Facebook and Twitter!  If someone needs a basic introduction to the FAIRtax, this e-book is what they need. We all need to become engaged in order to force Congress and President Trump to adopt the FAIRtax as the new tax plan.   We all need to come up to speed on the FAIRtax.  This e-book is the first step. 

AMERICA'S BIG SOLUTION is available for only $2.99 for the Amazon Kindle, the Barnes & Noble Nook and Apple iOS.  

AMERICA'S BIG SOLUTION by Florida Volunteer Terry Tibbetts has been written to give people of all ages a basic introduction to the FAIRtax and encourage them to learn more about the most thoroughly researched tax plan ever presented to Congress.  It is a light hearted approach to a very serious subject. 

Everyone needs to know that we have an alternative to federal income tax and the criminal enterprise known as the IRS.  Everyone needs hope and AMERICA'S BIG SOLUTION provides that hope. AMERICA'S BIG SOLUTION is an alternative the social media platforms competing for our attention. 

You can even purchase a print copy at the same Amazon link above for $9.25.  Regardless of whether you choose the electronic format or the print format, you'll find AMERICA'S BIG SOLUTION will give someone the boost they need to begin their study of the FAIRtax and the suggested resources to learn more. Buy AMERICA'S BIG SOLUTION now!

FAIRtax Power Radio
Weekly Podcasts and Monthly Facebook LIVE

The FAIRtax Guys have been posting a weekly FAIRtax Power Radio podcast on Spreaker, iTunes and iHeart Radio for almost a year now.  And every episode is different.  Since the FAIRtax affects every aspect of life in the United States, we find something new to talk about every week.  Even if you are very familiar with the FAIRtax, you’ll find something new in each episode and it’s completely free.  Since it’s a podcast, you can listen whenever you have time on your computer or your smart phone.
 
Through the “Hope and Change” of the last eight years and the promises to “Make America Great Again,” what is Congress and the new administration offering us as tax reform? At this point, both President Trump and the Speaker Ryan are offering a modification of the current failed system. As Kerry Bowers, one of The FAIRtax Guys interviewees, said about Speaker Ryan’s “A Better Way” plan, “It transforms the tax plan from a personal income tax, a corporate income tax and a payroll tax enforced and administered by the IRS to a system that includes a personal income tax, a corporate income tax and a payroll tax enforced and administered by the IRS.”  Is this REAL reform?  No!
 
As The FAIRtax Guys discuss, this plan does not represent “Hope and Change” and is not the way to “Make America Great Again.” We need true tax reform; we need the FAIRtax. And we provide the listener new and novel ways to discuss the FAIRtax with your friends and neighbors every week. 
 
You can listen to our FREE podcasts on Spreaker.com, iTunes or iHeart Radio. You can listen on line or download the podcasts to your computer or smartphone. 
 
For your iPhone or Android, we have a free app. Just search for FAIRtax Power Radio in your app store, download the app and start listening.  We post a new episode every Friday morning.  Please listen in and tell everyone you know about the FAIRtax Power Radio podcasts. 
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Links for Further Information

Please, if you'd like to keep studying and promoting the FAIRtax, make yourself familiar with the links below. We always do our best to keep our AFFT community up to date, and you can stay ahead of the curve using these convenient sites.

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