House Republicans Want a Vote On the FairTax. Is It Worth Supporting?

Published

2 years ago

January 12, 2023

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When Rep. Kevin McCarthy (RCalif.) finally secured the votes necessary to become the next House speaker, it required concessions to dissenters within his party. Members of the House Freedom Caucus demanded, among other things, a vote on the Fair Tax Act, which has been introduced in the current session.

The Fair Tax Act, while likely doomed by a Democratic Senate and White House, represents the first serious challenge to the American tax code in recent memory. Versions of the act have been proposed since at least 1999. While it has never been voted on in the House, it has been endorsed by multiple Republican presidential candidates and Libertarian presidential candidate Gary Johnson.

The bill would overhaul the nation’s entire tax code, scrapping all federal taxes in favor of the FairTax, a 23 percent national retail sales tax. Proponents argue that the 23 percent number is comparable to a 15 percent income tax plus the 7.65 percent payroll tax rate employers pay. In return, taxpayers would keep every cent of their paychecks and only pay taxes on the money they spend.

That shift would have major and immediate consequences. Annual tax returns and W-2s would cease to exist. People who make their money on the black market would be taxed at the same rate as anyone else. The enormous compliance costs currently associated with filing one’s annual taxes would be cut significantly. With only one tax and no deductions, the entire process of funding the government would be more precise and transparent.

There are also tradeoffs. For one, around 40 percent of American households currently pay no federal income taxes, most of whom are in the bottom two-fifths of income earners. Under a FairTax system, those households would marginally increase their take-home pay but take it on the chin at the grocery store.

To account for the regressive structure of a pure consumption tax, the Fair Tax Act provides for a monthly stipend, which supporters call a “prebate.” All American citizens, regardless of need or income level, would receive a “sales tax rebate” to offset their estimated monthly tax liability for essential purchases. Currently, the Social Security Administration dispenses monthly benefits to nearly 70 million people; the Fair Tax Act would increase that number to include every single adult.*

The bill’s sponsor, Rep. Earl “Buddy” Carter (RGa.), said, “Instead of adding 87,000 new agents to weaponize the IRS against small business owners and middle America, this bill will eliminate the need for the department entirely.” Abolishing the IRS is central to FairTax supporters’ message: The cover of 2006’s The Fair Tax Book featured the agency under a red circle-slash.

Under the FairTax, however, another federal agency would have to take its place to adjudicate which purchases qualify. A retail purchase is taxed, but buying manufacturing equipment to produce retail goods is not; if a manufacturer purchases equipment but then later decides to resell it, then that would require a payment of sales tax after the fact. This post hoc transaction would presumably require a central compliance authority similar to the IRS.

The Fair Tax Act is a featured bill in the pantheon of longshot legislation. Even if supporters could get it through both houses of Congress and signed by a president, it couldn’t into effect until the 16th Amendment, which officially gave Congress the authority to tax income, was repealed. Amending the Constitution requires the assent of three-fourths of all U.S. states. The Constitution has not been amended since 1992.

*CORRECTION: Under the FairTax, the prebate would be given to every American.

Entertainment

Hollyoaks star Paul Danan dies aged 46

Published

59 mins ago

January 16, 2025

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Hollyoaks star Paul Danan has died at the age of 46.

He played bad boy Sol Patrick in the Channel 4 soap Hollyoaks in the late 1990s and early 2000s.

He later appeared on the celebrity versions of Love Island and Big Brother.

Announcing his death, Danan’s management said in a statement: “It is with heavy hearts that we share the tragic news of the passing of @pauldanan at just 46 years old.

“Known for his television presence, exceptional talent, and unwavering kindness, Paul was a beacon of light to so many.

“His untimely departure will leave irreplaceable voids in the lives of all who knew him.

“During this difficult time, we kindly request respect and privacy for Paul’s family, friends, and colleagues. No further comments will be made at this time.”

Danan’s last post on his official Instagram page was a short video audition for the Shakespeare play Twelfth Night, in which he was reading for the role of Orsino. He posted it one week ago, commenting on how “beautiful and exhilarating it is” to get stuck into new work.

DJ Fat Tony was one of the first to pay tribute, calling him “one of the sweetest men,” saying Danan’s death at such a young age “hurts so bad”.

The actor, who trained at Italia Conti drama school, regularly called for his return to Hollyoaks.

He later began the podcast The Morning After With Paul Danan, which lasted from 2019 until 2023.

Danan had appeared twice as a contestant on Celebrity Love Island in 2005 and 2006, but did not win either series.

In 2017, he took part in Channel 5’s Celebrity Big Brother, where he was evicted early. He said at the time he hoped the series would give him a “second chance” at his career.

He’d also appeared on shows including E4’s Celebrity Coach Trip, and Channel 4 sketch comedy programme The Kevin Bishop Show.

He also had a role on CBBC show The Queen’s Nose, playing Melody’s agent Max.

Danan had spoken openly about his issues with substance abuse and poor mental health, and told The Sun a relapse over lockdown had left him homeless.

He went on to set up a theatre company called Morning After Drama in Bristol, offering free workshops to vulnerable groups.

Danan had also planned to set up a linked charity, The Other Side Of Morning CIC to offer community projects around the country. He had shared news about the charity on TikTok in late December.

Danan leaves behind his nine-year old son, Deniro.

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Sports

McDavid passes Kurri for 2nd on Oilers’ points list

Published

59 mins ago

January 16, 2025

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McDavid passes Kurri for 2nd on Oilers' points list

Associated Press

Jan 16, 2025, 01:20 AM ET

ST. PAUL, Minn. — Connor McDavid continues setting records and moving up scoring lists.

McDavid had two goals and an assist in the Edmonton Oilers‘ 5-3 win against the Minnesota Wild on Wednesday night, passing Jari Kurri for second all time in points in Edmonton history. McDavid, a three-time Hart Trophy winner for league MVP and five-time scoring champion, now has 1,044 points in his 10-year career and trails only Wayne Gretzky on the franchise list.

Kurri had 1,043 points in his 10 years with the Oilers, playing on a line with Gretzky for much of it. Gretzky, the NHL’s all-time leading scorer, had 1,669 points in nine seasons in Edmonton.

“Quite a remarkable feat,” Oilers coach Kris Knoblauch said. “For him to go up the scoring list as quickly as he has, and within an organization that has had so many significant players. I’ve seen so many remarkable things from him. He’s a tremendous player and great teammate. I said I wouldn’t be surprised anymore just because he surprises you so often over these years, but it’s a nice feat for him and the guys are very proud of him.”

McDavid’s second goal was of the highlight variety. He shot the puck from a tough angle, lifting it over Minnesota goalie Filip Gustavsson without much room.

McDavid didn’t speak to reporters after the game. He was involved in a collision with Minnesota forward Marcus Johansson in the second period in which McDavid’s elbow hit Johansson in the face. There was no penalty called, but it drew the ire of the Wild.

Sports

Injured Caps goalie Lindgren returns to practice

Published

59 mins ago

January 16, 2025

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Injured Caps goalie Lindgren returns to practice

Field Level Media

Jan 15, 2025, 03:02 PM ET

Washington Capitals goaltender Charlie Lindgren practiced with the team on Wednesday for the first time since his upper-body injury on Friday.

He will travel with the team to Ottawa but is still on injured reserve and isn’t eligible to play in Thursday’s game against the Senators. Lindgren, 31, can be activated on Saturday, when Washington hosts the Pittsburgh Penguins.

“Not quite ready with being on the IR and that, but another positive step being on the ice today,” Capitals coach Spencer Carbery said.

Lindgren took a hit to the head and left the Capitals’ home game against the Montreal Canadiens on Friday. In the first minute of the second period, he was struck in the side of the head by Montreal’s Nick Suzuki, who was checked into the goalie by Brandon Duhaime. The game resumed, but Lindgren was pulled approximately two minutes later, and the Canadiens went on to win 3-2 in overtime.

Lindgren is 10-8-2 with a 2.65 goals-against average and .900 save percentage in 21 starts.

He has a career record of 63-47-14 with a .277 GAA and .907 save percentage in 131 regular-season games (123 starts) for the Montreal Canadiens (2015-20), St. Louis Blues (2021-22) and Capitals.

Washington forward Sonny Milano participated in his first full practice since sustaining an upper-body injury on Nov. 6 against the Nashville Predators. Milano, 28, wore a non-contact jersey as he continues his recovery. Milano has played in three games this season.

He has 137 career points (62 goals, 75 assists) in 313 games with the Columbus Blue Jackets (2015-20), Anaheim Ducks (2020-22) and Capitals.