FairTax Proposal

About FairTax Proposal

The FairTax is a proposal to replace all US federal taxes with a 23 percent national sales tax on all goods and services. The FairTax includes a prebate, a monthly payment to all households to offset the tax on spending up to the poverty level, making it progressive. The proposal was introduced in Congress in 1999 by Representative John Linder and has been reintroduced in every subsequent Congress. The FairTax gained attention when Mike Huckabee and Herman Cain supported it during presidential campaigns. Critics argue the 23 percent rate is actually 30 percent when calculated as a traditional sales tax, and that it would be regressive and difficult to enforce. The FairTax has never received a floor vote in Congress.