Fair Tax Bill Reintroduced with Record SupportJanuary 14, 2015
On the first day of the 114th Congress, the Fair Tax Act (H.R. 25) was reintroduced by Rep. Rob Woodall (R-Ga.) with 57 original co-sponsors— the most the bill has ever had at the time of introduction. H.R. 25, if enacted, would replace the individual federal income tax, the capital gains tax, all payroll taxes, corporate income taxes, the self-employment tax and the estate and gift taxes with a revenue-neutral personal consumption tax—a 23 percent tax on the end point-of-sale for all goods. NSBA is a long-time supporter of the Fair Tax as it aims to simplify and increase fairness in the current tax code.
The financial burden of taxes on small businesses is significant and the sheer complexity of the tax code has actually become an even larger burden. In fact, it is estimated that Americans spend billions of dollars just trying to comply with the tax laws and regulations. The most recent NSBA Taxation Survey found that a majority of small businesses spend over 80 hours per year dealing with federal taxes, which equates to more than two full work weeks just on federal taxes alone. Furthermore, small businesses reported that they spend more than $5,000 annually on the administration of federal taxes in the form of accountant fees, internal costs, legal fees, etc. The Fair Tax offers fundamental reform, simplification and long-needed tax relief to our nation’s job creators, small businesses.
Specifically, H.R. 25 would ensure every taxpayer is subject to the same tax rate and gets to keep 100 percent of their paycheck, pension, and Social Security payments enabling them to save more, invest in their businesses, and boost our economy through job creation and innovation. Under H.R. 25, tax rates will depend on the amount of purchases made; used items will not be taxed, which promotes reutilization; and business-to-business purchases for the production of goods and services will not be taxed. In addition, those who are least able to share in the cost of government would bear no burden at all.
Therefore, NSBA continues to support the Fair Tax as a way to not only ease the tax burden, but to also ease the growing complexity of the code. Small-business owners are encouraged to contact their lawmakers and urge them to support this critical piece of legislation.
Click here to read NSBA’s letter of support for the Fair Tax Act.