Fair Tax Folly

Supporters of the so-called Fair Tax are gathering at the Boone County Fairgrounds tomorrow with esteemed economists Samuel Wurzelbacher (a.k.a. Joe the Plumber), Neil Boortz (a Libertarian radio host) and Georgia Congressman John Linder (a former beneficiary of Jack Abramoff's schemes) in attendance.  The event is sponsored by right-wing radio station 93.9 "The Eagle," and promises to be a colorful affair. 

I don't really get why folks find the "Fair Tax" to be so appealing. It doesn't actually cut any government or reduces taxes. It shifts everything to sales taxes, increases the burden on middle-class and low-income families, and reduces the burden on the wealthy. That doesn't slow supporters, though, who seem to be convinced that a Fair Tax would magically let everyone pay less money for the same services.

To be truly "revenue neutral," Missouri would have to institute a 12.5% sales tax on all purchases, including rent, health care, dependent care, food and utilities. It would also create a very strong incentive for people to avoid the increased sales taxes by not reporting the sales, or simply driving across state lines to do their shopping.

For more information, check out the analyses from the Missouri Budget Project and Institute on Taxation and Economic Policy, and a breakdown of the very creative math used by proponents from FactCheck.org.

Nevertheless, the tomorrow's rally will most certainly be Jeff Parnell's performance of "The Fair Tax Song" -- especially the part when everyone yells, "We've got to get rid of the IRS, HEY! HEY!"