August 4, 2011, Manchester, NH
– Meeting Thursday with small business owners at the Amoskeag Business
Incubator in Manchester, NH, Presidential candidate and former New
Mexico Governor Gary Johnson called for abolishing the current income
and payroll tax system and replacing it with a consumption-based tax,
known as the FairTax.
Endorsed by many U.S. economists, the
FairTax Plan is designed to collect the revenue needed for the federal
government from a broader tax base at a lower effective rate than the
current system of taxing income. Taxpayers and businesses would pay no
federal income or payroll taxes, but would pay a 23% tax on goods and
services they buy. A “prebate” would be granted to all taxpayers,
regardless of income, to offset payment of the FairTax on purchases of
necessities up to the federal poverty level.
Johnson said, “There are many ways to describe our current 70,000 page
tax code, but ‘fair’ is not one of them.
“It
is simple economic common sense that the most equitable and sustainable
system for providing the tax revenues we need is one which places the
burden on the broadest base at the lowest possible rate. Taxing
income
runs fundamentally counter to that goal, and it creates perverse
incentives that stifle economic growth and kill jobs. Changing to
a
system which taxes consumption, rather than earnings, will encourage
savings and investment, provide American families more freedom to spend
their hard-earned money as they choose, and put people back to work.”
Johnson
continued, “With the ‘prebate’ provision of the FairTax, no one will
pay taxes on expenditures for basic necessities, and the average
taxpayer will pay a smaller portion of their income in federal taxes
than they are now. The result is an equitable tax that is
progressive
on the basis not of income, but lifestyle and spending choices.
“Likewise,
as we watch the politicians in Washington haggle over whether or not
various tax credits and loopholes should be closed, I would strongly
suggest that it is time that we simply do away with all of them, and
get the government out of the business of picking winners and losers
and otherwise using the tax code to manage our behavior. By
treating
every taxpayer and business equally, the FairTax will do just that. In
fact, the FairTax proposal would abolish the IRS, and provide
incentives for the states to actually collect the tax, using their own
systems and experience with administering sales taxes.
“And, as
the Administration and Congress wring their hands over our unacceptably
and persistently high unemployment and talk about reducing the
corporate income tax rate and adopting other half-measures, I say we do
away with corporate income taxes altogether – which the FairTax would
do. That alone will foster more real job creation than all the
stimulus and tax code tinkering that is currently being discussed, and
would immediately move the U.S. to the head of the class in terms of
global competitiveness.
“Rather than exporting jobs and losing
employers to more friendly tax environments overseas, America would
become a magnet for job-creating investment both by businesses who are
already here and those who would come here.”
The FairTax and its
23% rate are designed to be revenue neutral, generating sufficient
revenue to fund all government operations and existing benefits,
including Social Security, Medicare and other entitlements.
Please contact New Hampshire Communications Director Matt Simon at
matt.simon@garyjohnson2012.com
or
603.391.7450
for local media requests or Lizz Renda at
media@garyjohnson2012.com
or
801.303.7924
to schedule an interview with Gary Johnson. For more information,
please visit
www.garyjohnson2012.com.
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