Article & Journal Resources: Radio talker Neal Boortz, a fair-tax flogger, answers a Wall Street Journal editorial

Article & Journal Resources

Radio talker Neal Boortz, a fair-tax flogger, answers a Wall Street Journal editorial

We really do hate to break it to the editorial board at the Wall Street Journal, but the simple fact of the matter is that the FairTax is not calculated like other sales taxes. The FairTax is included in the price, not added on top of the price. Perhaps the board would be less inclined to misstate the terms of the FairTax if they actually read the book or H.R. 25, but we're patient people, so we'll explain this one more time:

(a) Current state sales taxes: You look at the item on the shelf. The item is priced at $100.00. You take that item to the cashier. The cashier adds the state sales tax to the $100. If that sales tax is 7 percent, you pay $107, take your receipt and walk out.

(b) FairTax: You look at the item on the shelf. The item is priced at $100. You take the item to the cashier. The cashier asks you for $100. You pay your $100, take your receipt and walk out. You look at the receipt. The receipt tells you that 23 percent of the $100 you paid for that item is the FairTax and will be forwarded to the federal government. You call upon your years of education and quickly calculate that $23 is 23 percent of $100.

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