Thursday March 9, 2023 – Did you hear about H.R. 25, the Fair Tax Act of 2023. This bill was introduced in House of Representatives in January 2023, right after the Republicans took over.
Supporters claim the bill will simplify the current tax code and reduce federal spending. The act would replace the existing income, payroll, estate and gift taxes with a 23% national sales tax on consumable goods and services. The Family Consumption Allowance would ensure that low-income and middle-class families are not unfairly burdened by the sales tax. Additionally, it would reduce federal spending by over $71 billion in 2023 and eliminate the need for the Internal Revenue Service completely.
Democratic Reps. Wiley Nickel of North Carolina, Eric Sorensen of Illinois and Brittany Pettersen of Colorado called the measure “extremist.” Yesterday Nickel said he “was dismayed to hear about an extremist plan by my colleagues on the other side of the aisle that calls for a 30% national sales tax for working families,” He continued “[a] 30% sales tax would be a disaster for working families and individuals in North Carolina and around the country who are already dealing with high gas prices, exorbitant housing costs and the rising costs of goods and everyday services.”
Attorney Steven A. Leahy said “I find the proposal interesting and worth investigating. Anything is better than the current system. Isn’t it?” Catch his analysis on Today’s Tax Talk.