Changes

Republican presidential candidate [[Rudy Giuliani]] criticized the Fair Tax when he addressed a group at the [[University of Florida]] in July, 2007<ref> “Giuliani Jeered For Opposing Flat Tax”, Associated Press, July 2007, http://www.forbes.com/feeds/ap/2007/07/07/ap3891710.html</ref>: "I don't think a Fair Tax is realistic change for America. Our economy is dependent upon the way our tax system operates<ref> “Giuliani Jeered For Opposing Flat Tax”, Associated Press, July 2007, http://www.forbes.com/feeds/ap/2007/07/07/ap3891710.html</ref>."  

Republican presidential candidate [[Rudy Giuliani]] criticized the Fair Tax when he addressed a group at the [[University of Florida]] in July, 2007<ref> “Giuliani Jeered For Opposing Flat Tax”, Associated Press, July 2007, http://www.forbes.com/feeds/ap/2007/07/07/ap3891710.html</ref>: "I don't think a Fair Tax is realistic change for America. Our economy is dependent upon the way our tax system operates<ref> “Giuliani Jeered For Opposing Flat Tax”, Associated Press, July 2007, http://www.forbes.com/feeds/ap/2007/07/07/ap3891710.html</ref>."  

None of the 2008 Democratic presidential candidates support the Fair Tax either, although [[Mike Gravel]] has indicated he supports a new kind of system based around consumption (expense) rather than income.

None of the 2008 Democratic presidential candidates support the Fair Tax either, although [[Mike Gravel]] has indicated he supports a new kind of system based on consumption (expense) rather than income.

Aside from political criticism, however, the FairTax suffers from serious constitutional infirmities. Supporters have tried to paint the tax as an "[[excise]]". But this is wrong. The constitutional definition of an [[excise]] is a tax that is strictly limited to '''privileged''' or '''luxury''' goods and activities. The writings of the Founding Fathers, as well as numerous U.S. Supreme Court and lower court rulings, confirm this definition.<ref>http://www.conservapedia.com/Excise</ref> However, the FairTax encumbers '''necessities''' ''in addition to'' privilege and luxury items, thus making it a '''Direct tax''' within the constitutional meaning of the term. Unlike true [[excise]]s, the FairTax cannot be "avoided" because it taxes things which are necessary to live. These include food, clothing, housing, transportation, medicine, health care, arms for self-defense, phone service, sundries, education, etc. Any tax that encumbers such items must be apportioned among the states, or it violates the Constitution.

Aside from political criticism, however, the FairTax suffers from serious constitutional infirmities. Supporters have tried to paint the tax as an "[[excise]]". But this is wrong. The constitutional definition of an [[excise]] is a tax that is strictly limited to '''privileged''' or '''luxury''' goods and activities. The writings of the Founding Fathers, as well as numerous U.S. Supreme Court and lower court rulings, confirm this definition.<ref>http://www.conservapedia.com/Excise</ref> However, the FairTax encumbers '''necessities''' ''in addition to'' privilege and luxury items, thus making it a '''Direct tax''' within the constitutional meaning of the term. Unlike true [[excise]]s, the FairTax cannot be "avoided" because it taxes things which are necessary to live. These include food, clothing, housing, transportation, medicine, health care, arms for self-defense, phone service, sundries, education, etc. Any tax that encumbers such items must be apportioned among the states, or it violates the Constitution.

Another problem is that any purchases made overseas, including money spent on investments, would not be subject to the tax. This could easily lead to "hoarding" and a loss of revenue for the government.  

Another problem is that any purchases made overseas, including money spent on investments, would not be subject to the tax. This could easily lead to "hoarding" and a loss of revenue for the government.  

Finally, the FairTax shares a major flaw with the current income tax system: There is no cap on the rate that Congress may impose. If the FairTax were to become law, the rate might be initially established at 23%, as proponents believe. But nothing in the FairTax proposal prevents Congress from raising the rate to 30%, or even higher. Given the government's proclivity for spending money, an eventual increase in the FairTax rate, were the measure to pass, seems inevitable.<br />

Finally, the FairTax shares a major flaw with the current income tax system: There is no cap on the rate that might be imposed by Congress. If the FairTax were to become law, the rate might be initially established at 23%, as proponents believe. But nothing in the FairTax proposal prevents Congress from raising the rate to 30%, or even higher. Given the government's proclivity for spending money, an eventual increase in the FairTax rate, were the measure to pass, seems inevitable.<br />