23 percent in Fair Tax Act is good

The Fair Tax Act proposes a tax on all new merchandise and services in place of all income taxes, payroll taxes, corporation taxes, and taxes on dividends, interest, and capital gains. Critics of the act, which proposes a 23 percent inclusive tax, have confused the issue by saying that this law is in reality a 30 percent tax. To clear up this misinformation, consider the following explanation.

The 23 percent tax is included in the stated price of each item or service. Thus for a $100 item, $23 goes for taxes, and the remaining $77 pays the cost of the item. This is the same as saying that if y...