...The FairTax will bring fiscal sanity back to the federal government by throttling the government's ability to take money from under taxpayers' noses...

Slay the Withholding Beast

Joseph Pickett

Few Americans under 65 realize the withholding box on their pay stubs is a relatively recent addition. Federal withholding of income taxes was a 'temporary' measure enacted during the Second World War as a means to ensure that the government received desperately needed revenue to fund the war effort. With the very real, terrifying possibility of the fascists taking over the world, most Americans of that age accepted the measure as necessary to defeat the Axis powers centered in Tokyo and Berlin.

The war is 60 years over as of 2003, and Japan and Germany are among our closest allies, yet withholding of taxes marches on. It is hardly surprising that once politicians drove a wedge between taxpayers and their hard-earned money, they were loath to surrender it. If one wishes to steal their neighbor's property with the least amount of fuss, doing so without their knowledge is the best route. Thus, the 'temporary' change stayed for good. This made the paying of taxes, if not painless, then at least more palatable and less visible. The government got its money and lawmakers got reelected. A perfect world for the lawmakers, but what about for the average citizen?

Supposedly, their money is being spent on their behalf to fund vital services for taxpayers, but a hard look at the numbers suggests that the government list of 'essential' services is expanding at a breakneck pace. With the help of tax withholding, the government collected and spent a jaw-dropping $2 trillion dollars in 2002. It accounted for nearly 1/3 of all national spending last year.

Thomas Jefferson once wrote, "I have sworn upon the altar of God eternal hostility against every form of tyranny over the mind of man."� It's not difficult to imagine what he would call a system that takes the hard-earned wages of citizens before they receive it and uses it to fund an ever-bloating federal government.

In the 18^th century, it was known as tyranny.� Back then, British government tyranny brought about a revolution, one that changed world history. Today another revolution is approaching, but one that will slay the current tax code rather than our fellow man. It is called the FairTax.�

The FairTax, H.R. 25, introduced into Congress by Rep. John Linder of Georgia and co-sponsored by more than 20 members of Congress, is a non-partisan proposal that will abolish not only withholding, but all federal income taxes, including capital gains taxes, all payroll taxes, estate and fit taxes, and corporate and self-employment taxes. All of these will be replaced with one simple federal sales tax of 23 percent. It will dramatically change the basis of taxation in the Unites States - shifting it from taxing what we earn to what we spend.

The FairTax allows workers to keep their entire paycheck, closes all tax loopholes, frees individuals from filing tax returns, abolishes the IRS, eliminates all hidden federal taxes, and allows every family to by basic necessities tax-free.

The FairTax offers these advantages over the current tax system:

Fairness - All taxpayers will be treated equally because citizens will be taxed on what they spend, not what they earn. Those who consume more will pay more, and those who choose to save or invest will pay less.

Simplicity - Paying federal taxes will be as simple as paying state sales tax is today. A sales tax will apply to all purchases of new goods and services only once at the point of final purchase.

Lower taxes - For most taxpayers, the effective tax rate of the FairTax will be far less than what it is under the current income tax system. For example, a couple earning $30,000 today pays $2,295 in payroll taxes and $2,595 in income taxes for a total of $4,890. When hidden payroll taxes are included, the total jumps to $7,185, about 22% of their income. Under the FairTax, that couple would receive a rebate of $4,790. If they spend everything they earn, their sales tax bill would be $3,110, or just 10.5%. It would be even less if they saved any of their income.

Revenue Neutrality - The FairTax will raise the same amount of revenue for the government as the current system does. Studies show that consumption is actually a more reliable source of revenue, because even during periods of low or no income, people still find a way to continue some level of consumption, usually by borrowing or using savings.

If the FairTax sounds too good to be true, turn to the words of Alexander Hamilton, the founder of our monetary system and a supporter of consumption taxes. He said, "It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess."

Quite simply, The FairTax will bring fiscal sanity back to the federal government by throttling the government's ability to take money from under taxpayers' noses by withholding their own money from them. The taxpayer will be in the driver's seat. The time for the FairTax has come.

For more information on the FairTax proposal, including its current status in Congress, visit www.fairtax.org, and also Rep. John Linder's Web site, www.votelinder.org

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