Originally posted by Cow Poke
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But here's the problem: how do you know what tax rate will cover the budget? You have no control over what people buy. Furthermore, taxing will have a negative impact on purchasing, potentially setting up the economy for a recession and deflation. On the other hand, taxing income is a bit more predictable - and people cannot elect to not have an income. Indeed, even when it is taxed, people continue to try to work to improve their income. A flat tax on income would create no impediment to this upward mobility.
So while I am not against consumption taxes, I think income taxes are better.
BTW - "fair tax" is just a marketing gimmick. The income tax I described could also be called a "fair tax." The difference is income versus consumption - not fair vs. unfair.
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