The FairTax Book: Saying Goodbye to the Income Tax and the IRS

by Neal Boortz, John Linder

Wouldn't you love to abolish the IRS ...
Keep all the money in your paycheck ...
Pay taxes on what you spend, not what you earn ...
And eliminate all the fraud, hassle, and waste of our current system? Then the FairTax is for you. In the face of the outlandish American tax burden, talk-radio firebrand Neal Boortz and Congressman John Linder are leading the charge to phase out our current, unfair system and enact the FairTax Plan, replacing the federal income tax and withholding system with a simple 23 percent retail sales tax on new goods and services. This dramatic revision of the current system, which would eliminate the reviled IRS, has already caught fire in the American heartland, with more than six hundred thousand taxpayers signing on in support of the plan. As Boortz and Linder reveal in this first book on the FairTax, this radical but eminently sensible plan would end the annual national nightmare of filing income tax returns, while at the same time enlarging the federal tax base by collecting sales tax from every retail consumer in the country. The FairTax, they argue, would transform the fearsome bureaucracy of the IRS into a more transparent, accountable, and equitable tax collection system. Among other benefits, it Endorsed by scores of leading economists and supported by a huge and growing grassroots movement, the FairTax Plan could revolutionize the way America pays for itself. In this straight-talking book, Neal Boortz and John Linder show you how it would work—and how you can help make it happen.

Genres: Politics, Nonfiction, Economics, Finance, Business, Money, Taxation

208 pages, Hardcover

First published August 2, 2005

Reviews

[Lauri · Rating 4 out of 5]

This is a very hard book for a bleeding-heart liberal girl like me to read. As an adult, I have come to believe that the income tax is a punitive tax for middle class and especially lower class people. However, for those wealthy people who manage to scrape up enough cash for a vacation home, a yacht, and multiple luxury cars, I doubt that the income tax is truly impeding their ability to eke out a life of quality and security. I am a middle class American, and, while my taxes are high, they do not impede upon my ability to own a car, own a home, save for my retirement and have some fun in the meantime. So, while I am skeptical about removing the income tax from the wealthy, I am generally open to the concept put forward in this book: tax on consumption. This way, you can keep your money if you choose not to spend. Simple enough.

I'm only 10 pages in currently and already the authors have said some things that make my skin crawl. Not the least of which was pointing out that the American civil war wasn't "technically" a civil war---how this is relevant to the book's topic I'll not understand, but it points to some deeper felt (and weird) principle that the author must ascribe to. My concern is that the authors of this book, admittedly, have much bigger plans for basically abolishing the role of the Federal government and cutting taxes (although they point out that these topics are off-point for this book). While I am a big proponent of federal fiscal responsibility, I am also adamant that we keep/establish a handful of social programs as any wealthy country has an obligation to do to protect its many, hard-working citizens. Any capitalist society has to have an air of socialism to it or it will crumble. Just one example of this was the Great Depression when the capitalist system came to a crash and there were no programs in place to protect the citizens. Capitalism is a concept that provides certain freedoms, but that thrives on greed. Any society thinking that it can succeed based upon a system of individual gain alone will pursue such a concept at its peril. I'll read this book through and give them a chance to persuade me. As long as my fears are allayed that this is not simply a plan for the rich to get richer while the poor stay poor, this might be a tax plan I could back. Life is about "we" not "me" and my hope is that this tax plan supports rather than detracts from that basic credo.

After concluding the book, I found the new tax plan radical, but fair. It really does seem to make good sense. I found some of the conservative rhetoric in this book offensive, but it didn't detract from what seems to be a way better, and more simple tax system than what we have today. It's definitely worth the read.

[Peter · Rating 1 out of 5]

I saw Neal Boortz during some economic policy "round table" on television and heard a bit about Fair Tax. The premise of this movement is that income tax of every sort (regular income tax, payroll tax, estate tax, investment tax) should be abolished and replaced with a 23% sales tax on everything. Sounds simple, vaguely Steve Forbesian, but would it work. My first instinct was to think, wow, this is preposterous. If we have marginal taxation rates in the mid-30% range, how will a 23% sales tax yield the same amount. So, in an effort to be open-minded and see both sides of the issue, I got this book (from the library).

And I read it. On one level, the book was impressive. It was an illustration of how, when authors have an agenda, they can write things as fact with little or no substantiation. There are few central issues with National Sales Tax plans (From this point forward, I'm refusing to call it Fair Tax-- this name suggests that it is fair relative to other tax plans, such as our IRS-administered one, and there is no evidence this is true. Also, the naming of the plan is word-play trickery; if you're against the plan, what do you want, UnFair Tax? This kind of nonsense is so pervasive in the book, it actually amazed me. But more on this in a bit). First, will the proceeds of the sales tax be as much as the proceeds of the the existing or some other alternative tax plan. Second, will the sales tax push the burden on to the poor? A few notes on each.

The authors never make it clear that the proceeds from their tax plan would yield the same revenue as the current system. I expected to see some numbers, saying, for example, today x number of people pay on average y number of dollars. Under our plan, a people will pay b dollars. Something. Anything! They make two propositions, which they repeat ad nauseum (until, I guess they go from being theory to fact with no testing). First, there will be the same amount of money. Second, the economy will grow so much that no one will care because everyone will be rich! They occasionally cite "studies" by "economists" that support their contentions. However, they only cite a couple of studies from the Cato Institute (which is hardly a peer-reviewed academic journal). So there is no evidence that any of what they say would actually happen. I guess you can't just quote Milton Friedman a couple of times and say you have all the answers.

They are really calling for an end to progressive taxation. They take great pains to suggest this is not the fact. They say they are not class warriors. In fact, they take swipes at the real class warriors, presumably those commies who passed the income tax in the first place, and those bleeding hearts who continue to allow the rich to be taxed at all. But they try to have it both ways. They gripe about how a large proportion of lower-income Americans don't pay any taxes (and even receive help from the government in the form of certain tax credits). Then they say their plan will remove all these benefits and make the poor and lower-middle class pay taxes. So how does this not shift the burden more to the poor? Their (weak, ill-conceived) counter-argument is that no one will be as poor, because the economy will be better and paychecks will be bigger. Again, given that this is completely unsupported by any evidence that they present, it is a hard pill to swallow.

This gets me to my biggest issue with this book. It is a fundamentally dishonest work. They claim their issue is with the inefficiency and waste of income tax and the IRS. But they seem to have a bone to pick with progressive taxation, which many citizens (at least the progressive ones) consider one of the hallmarks of our civilized society. They say that this will help everyone, but if they are really reading economics as much as they want it to appear they do, they'd know there is no such thing as a free lunch. If things get better for one person, they get worse for someone else. If they were just honest about what they were doing ("We want to lower taxes on rich people and unleash the power of the invisible hand") at least they could be assailed on that point. But in this propaganda pamphlet, they try to portray themselves as some sort of modern taxation Robin Hoods. But they have no interest in stealing from the rich.

I'm on to them, and I'm going to figure out a way to stop them. They rely on the fact that many of the people who would be hurt by their plan would never have the wherewithal to read and learn about it. And that is what needs to change.

[Tammi · Rating 5 out of 5]

This is a must read for anyone who votes and requires government accountability for the spending of our tax dollars. It is an easy read in easy to understand language and Boortz adds a bit of humor.

[Robin Canaday · Rating 2 out of 5]

Replacing all Federal income taxes with a 23% consumption tax on new goods and services at the retail level is an intriguing idea and sounds like a good idea in theory, but I wasn't convinced that the system proposed in the book was viable... it seems like the implementation would not be as simple as the authors suggest. Three big concerns I have are the lack of a definition of the term "retail level," collective purchases of new goods at the wholesale level that might be distributed through other than retail outlets, and it seems like they were also suggesting that the Fair Tax act would require internet retailers to keep track of all local jurisdictional (state, county, city et al.) sales taxes, which would skew odds in favor of large internet retailers and leave small time operators in the dust. They didn't go too much into depth on that point...

Additionally, I was irritated by the implicit finger pointing in the book; I'd rather read a fair and balanced assessment of a (possibly) needed tax reform, not a right-wing rant. The writing style of the book was loose and readable; the sources cited didn't seem very objective, however.

They prided themselves on writing a short book that contained all the information you would need to agree with them. I don't agree.

[Jeff · Rating 5 out of 5]

I'm not an economist, but not only did I read this book in a morning, but I actually understood it! After reading this book, I don't see how anyone could be against the Fair Tax, a proposal currently in the Congress that would actually abolish the IRS and replace income taxes with the fair tax (which is NOT a flat tax or a VAT tax). It is actually quite entertaining throughout with lots of humor and simple explanations.

[Marcia · Rating 5 out of 5]

I was really impressed by this book, and I'm definitely going to do my part to help the FairTax get signed into law and the income tax repealed. I knew the IRS was bad, but I had no idea how wasteful and unfortunate the income tax is until I read this book. It doesn't matter what your politics are, at the very least this book will make you rethink your support of the income tax.

[Mike · Rating 2 out of 5]

Is the national sales tax a good idea? Sounds a bit too much like a silver bullet. I hate paying income tax as much as the next guy, but this seems too simple. The arguments against the tax are dismissed with supposed benefits of the tax, some of which seem downright miraculous.

[Mckinley · Rating 1 out of 5]

About a single tax - consumption - replacing income tax. Important topic, needs revision for sure.
There are many less biased sources with more detailed descriptions of realistic scenarios.

- Many comments about size of returns from income tax rather than knowing how much tax one pays. Seems to me that if one cares, one can find out very easily. And one can adjust one's withholding to withhold less during the year and thus get less of a refund.
- It may well be that corporations have many loopholes. Corporations are legally viewed as individuals (another very problematic situation).

Other Thoughts:
A gallon of gas/ a gallon of milk costs the same regardless of income. This is not only about luxuries and extras. The government is charged with supplying it's citizens with services that are not profitable. Growing up my municipal government collected trash the cost came from property tax (sort of a consumption tax in that the 'better' the property the more taxes the owners pay). Now I pay a private company to collect my trash. We have created an economy where companies don't have to offer their workers with health care, sick leave, maternity leave, etc. Are we ok with the idea that if you are a millionaire, you can care for your baby but if you work for Walmart you can't?

[Robert · Rating 4 out of 5]

I'm not an economist, but the principles of this book seem sound and its implications profound. I've done some research into the common objections to this plan, and none seem to hold their weight. The elegance and simplicity of a consumption tax, coupled with the benefits for the economy seem to make it a no-brainer.

Boortz, although witty at times, tries a little too hard to be funny. Some of the explanations, while supporting sound principles, have a bit too much of a deceptive marketing spin for my taste. For these reasons I gave it four instead of five stars.

One main doubt I have deals with the 23% consumption tax being canceled out by the 22% lowering of consumer goods prices. The corporate tax, Social Security and Medicaid corporate withholdings, and corporate inefficiencies due to taxation (although a fair amount when totaled) don't add up to what is paid in income taxes. I'd like to see some better explanations of this seeming incongruity.

In spite of this concern, I see this plan as very beneficial to the economy and Americans in general. Unless I see some hard evidence in opposition, it has my full support.

[Toe · Rating 5 out of 5]

These important pages contain an indictment of the Rube Goldberg monstrosity that is our current tax code and a beautifully elegant solution to the problem.

I am obsessed with the idea of the FairTax, a national retail sales tax, because it provides numerous benefits and no insurmountable drawbacks. It would eliminate the IRS and hundreds of billions of dollars in compliance costs alone. It would reward saving, work, and effort. It is automatically progressive in that those who spend more will pay more taxes. It would free up resources to work out genuine problems and provide new products and services more cheaply. We would no longer waste resources in trying to minimize our tax bill. The American economy would explode. It would treat all Americans exactly equally and get the government out of the business of picking winners and losers.

A free society should not be interfered with by bureaucrats in Washington, and this idea is a giant step towards freedom. Taxes are necessary to fund defense and our court systems with a few small additional activities. The FairTax would provide those funds in a cleaner, simpler, fairer way. The only people who could possibly be against this idea are those who have their livelihoods sustained by the current abomination masquerading as a tax code, which runs to some 65,000 pages in length.

[Nathan Tensen · Rating 1 out of 5]

The FairTax is a sloppily written and offensive book for its outrageous statements (equating the ratification of the 16th Amendment with the terrorist massacre on 9/11 is beyond the realms of good taste, no matter how much you resent taxes)and for the insulting way it assumes everyone reading it can barely take time to focus on its serious arguments. Lower and flatter taxes is a fair discussion to have, but a national sales tax would be a deeply regressive system shifting more of the burden to middle class (the rich and poor, incidentally, would do better)and contrary to what the anti-tax simpletons assert, you will ALWAYS need an IRS or some bureaucracy to gather and tally the whole thing. Sorry, it's true.

[Shea Mastison · Rating 4 out of 5]

This is an interesting, perhaps even revolutionary book. Boortz and Linder make a compelling case for why their FairTax is the more efficient way for the federal government to collect taxes; while allowing things like corporate taxes, death taxes, etc. to wither away.

The whole principle of taxation itself is philosophically challenging to me. With that said, if even a quarter of the outcomes the authors predict come true as a result of enacting the FairTax--we should all be hassling our representatives in Washington D.C. to get them on the FairTax train with us!

I would recommend this book, regardless of one's political ideology. This is a visionary/radical plan and it deserves popular attention.

[Jamie Belanger · Rating 5 out of 5]

The FairTax Book is a quick read -- I read the whole thing in a single day, most of it in one sitting. But there is a lot of information crammed in there. I first heard about the FairTax several years ago, and every so often I spend some time perusing their website for information. So I went into this book already knowing a good amount. There were a few aspects of the plan that I did not know.

Every American should read this book, or at least read the FairTax website. We didn't always live under the oppressive umbrella of income taxes and the IRS. There is a better way.

[Darrel · Rating 4 out of 5]

Taxes are, unfortunately, a fact of life. After reading this book I am convinced that the FairTax is a much more reasonable way to collect federal taxes than the current system. I like the fact that the proposed system is very simple, transparent and does not play favorites with any demographic.

I encourage everyone to read this book and urge your elected representatives to make FairTax a reality.

[Smokey · Rating 5 out of 5]

This book clearly details a vastly superior system of funding the US government than that currently in place. It also explains why and how "The Fair Tax" would work, work wonders on our economy, and represent the single biggest power shift away from D.C. and into the hands of the populace since the American Revolution.

[Ellen · Rating 5 out of 5]

Someone gave this book to me at a property tax protest in Indianapolis. The arguments for the proposed FairTax legislation are impressive....so much that I'm now a believer. "The Fair Tax Book" is important stuff in spite of that putz, (coauthor) Neil Boortz.

[Tim Cox · Rating 5 out of 5]

Every adult in America should read this book and demand that their representatives support the FairTax. The only reason not to is so politicians can continue to reward the special interest groups funding them.

[Alex · Rating 5 out of 5]

Visionary. If you don't think the U.S. tax overhaul recommended in this book is advantageous to you, you are either not an American or you are an American criminal, or you can't think critically on this issue--a not uncommon problem among us.

[C. · Rating 1 out of 5]

I would support the idea of a National Sales Tax alternative to the current payroll tax system. However, this book was very poorly written and filled with too much "big cats in Washington" rhetoric. I would like to check out a more balanced view of this subject.

[Alain · Rating 1 out of 5]

I like the idea of a simple, fair and evenly applied tax. However, while the idea behind this tax is simple, it would result in anything BUT a fair and evenly applied tax. It would horrendously regressive and horrible for average people.

[Tiffany Saint · Rating 5 out of 5]

If you are a fan of Boortz'a radio show you already know how this book is going to read. If not, be careful, you might get your feelings hurt.

Wonderful!

[thew · Rating 5 out of 5]

Abolish the IRS!

[Ashley · Rating 5 out of 5]

a political read which is not what I would typically call entertaining, but it's very important and right on!

[Wendy · Rating 3 out of 5]

Interesting...He has a point.

[Kevin · Rating 5 out of 5]

Yes. Time to get rid of the current tax code that picks winners and losers and have a fair tax for all!

[Lavon Thorpe · Rating 5 out of 5]

This is the best book I have read this year. Very enlightening. Our country would be in a better place if we could adopt this system.

[Zach Zeidler · Rating 3 out of 5]

this makes sense -- time to can the income tax!!

[Jason · Rating 1 out of 5]

I picked up this book thinking it was a serious work on the VAT or some other consumption tax. It is not.

[Brian · Rating 4 out of 5]

Read it!

[Katie · Rating 5 out of 5]

This is a must read for everyone. Please don't let your political stance keep you from reading this one! It is an awesome plan that needs to be truly considered by our government.