Quote:The only consumption tax being proposed right now is the fair tax and it's still a progressive tax, it sends out prebates to offset the argument that the poor would be hit harder. 

 

That aside on pure principle, let's explore this concept who spends more who saves more and who benefits. Let me ask you, how aside from building more wealth by making better income does one stop being poor, the answer is spending less and saving more. Eventually that poor individual can learn to save they can create financial wealth, shouldn't we encourage that as a society? When was the last time a poor person spent themselves out of poverty? 

 

The idea that incentivizing savings would hurt the poor is ignoring the reality that in order to end poverty you have to learn to save. And I refuse to accept that no one can save, I've scraped the bottom of the economic barrell and yes there are times it's difficult but in today's modern world there are always cuts that can be made in order to save for tomorrow. It's a principle one HAS to learn if they are EVER going to get out of poverty. Otherwise an increase in income will result in no better of a financial situation they just simply spend more as they make more. 

 

As for the rich they are still paying taxes when they spend their money, which make no mistake the rich do spend money. 

 

Again all of this really isn't even an issue in the Fair Tax since it only taxes new items once, anytime an item is resold or sold as used it's non-taxed. I think there might be an exception on some larger purchases such as a home or car that have a lower used purchasing tax but I'm not sure, it's been a while since I read the fair tax proposal. The Fair Tax also as I mentioned before replaces things such as the EIC with pre-bate checks based on income level and family size, they argue it would be better to pre-bate families then to tax them and send them a refund at the end of the year. The Fair Tax isn't designed to change the tax burden or distribution of taxes it simply changes how their collected.