National Retail Sales Tax proposal gains momentum for real tax reform

The Democrats, for some reason, don't like the national retail sales tax. I think they honestly just don't get the concept, because the national sales tax would eliminate taxes on the poor by sending every low-income wage earner a bonus check each year that covered the sales taxes for basic cost-of-living items like food, clothing and rent. The real tax payers, under this system, would be the big-time spenders: rich people who want to drive $85,000 Hummers or float around on million-dollar yachts.

Under the National Retail Sales Tax (also called the Fair Tax in a slightly different rendition) allows each individual to control how much tax they want to pay by controlling their spending. If you don't like to pay taxes, then you can choose to buy less stuff. If you choose to consume at a high level, however, you're going to pay your fair share of the federal budget.

As readers of this site know, I think the Bush Administration is a political and humanitarian disaster. But if it manages to pass meaningful tax reform, that would at least be one positive thing the administration will have accomplished. It's foolish to automatically disagree with everything the Republicans propose. Smart Americans evaluate each proposal, regardless of which party sponsored it. Sadly, though, I think many well-meaning Democrats are against this tax reform simply because the Republicans are behind it. And that's a bad reason to oppose a good idea.

It's time to stop taxing poor people and start making the wealthy consumers in society pay for their lavish lifestyles. The Fair Tax or National Retail Sales Tax is the way to make that happen. The political party that thought of it first doesn't really matter.

• WASHINGTON --- The IRS and all payroll taxes should be scrapped and replaced with a national sales tax (search) that would require the poor to pay nothing, some tax reform advocates are proposing as an ideal plan to rejigger the U.S. tax code.
• Linder, a six-term representative, dismisses the central criticism of a national sales tax --- that it would disproportionately tax the poor --- by saying they would be exempted.
• But critics say Linder's plan is a little too neat, that his math does not add up and that it would be impossible to exempt the poor and still avoid having a behemoth agency like the IRS.
• Spending up to the poverty level, a figure determined by the Department of Health and Human Services (search), would be tax-free for all households.
• Critics of Linder's plan say "prebates" would complicate the supposedly streamlined plan, and make it impossible to get rid of the Internal Revenue Service.
• Under his bill, the Fair Tax Act of 2003 (search), Linder said that not only would the tax burden actually be less regressive, but America would benefit by creating a more competitive market with the elimination of corporate payroll taxes.
• The bill has the support of House Majority Leader Tom DeLay, R-Texas, and Linder predicted that another powerful ally would soon start lobbying President Bush.
• Responding to a question at a Florida campaign rally last month, Bush sounded open to discussion of a national sales tax.
• "I'm not exactly sure how big the national sales tax is going to have to be, but it's kind of an interesting idea that we ought to explore seriously," the president said.
• The next day administration officials said Bush was not considering such a reform.