Well, the idea that lower income people would pay a larger percentage of their income to the federal government because they would spend a larger percentage of their income on food, closing, housing and so on.But that's simply not the case. In the Fair Tax plan, there is a fixed rebate that goes back to each citizen each year. This rebate might be equal to $500 or $1,000 per citizen, and it would nullify the sales tax on low income people, meaning that they would end up paying absolutely zero tax. So this is the best tax plan of all for low-income people, since they would end up paying no tax whatsoever.
It's reallya tax on consumers, meaning the more you buy and the more you consume, the more tax you pay. And yet, since every individual would get a tax rebate that would cover the normal expenditures for an average person, you only end up paying tax if you wish to consume more than the poverty level of consumption. For example, if you wish to buy a more expensie car, or a bigger house, or five pairs of shoes instead of one, or expensive food items instead of more affordable food items, then you are going to be contributing tax dollars to the federal government
And of course, wealthy people tend to spend a lot more money than lower-income people, meaning that it is the wealthy people who will be spending more money and paying more taxes to the federal government, just as it should be in a fair and just society. If you wish to live in a very large home, or drive a nice car, or wear a $1,000 suit, or carry a $600 purse, that is your free choice, and if you choose to live in luxury, you will be funding public projects that ultimately benefit low-income people who don't operate at that high level of conumption.
Also, by switching to a Fair Tax system, we eliminate the taxes on investment in the U.S. This would bring in an avalanch of wealth to our shores, because suddenly the income is no longer taxed on that money, so investors and ultra-wealthy individuals would bring all of their billions of dollars from offshore accounts back into the U.S. to seek out new investment opportunities. In a sense, it would take all of these billions of dollars that are outside the control of the IRS, and bring them back into the system where they can be put to good use helping to create more jobs, better technology and more investment opportunities right here in America. The economy would benefit strongly from such a move.
Regarding being a good saver...I consider that to be the responsibilty of the individual.
