Currently, every tax a corporation pays is rolled into the price of a product or service, whether it’s income tax, value-added taxes, or simply compliance costs. Now, consumers will see a product’s actual price with no hidden tax components. The FairTax would also prevent large corporations from avoiding paying taxes.
Eliminating payroll taxes will significantly lower the cost of labor, therefore enabling businesses to hire more workers. The U.S. will be more appealing to businesses looking to relocate. Learn more about the elimination of the payroll tax.
U.S. exports are expensive, and foreign imports are cheap. The FairTax levels the playing field. Under the FairTax, imported goods and domestically produced goods incur the same U.S. tax. With the present system, U.S. companies and workers must pay income tax and payroll taxes, but foreign goods enter the U.S. entirely free of any tax, other than whatever modest customs duties are levied. The FairTax removes all taxes on exports, restoring the international competitiveness of American manufacturers in the global marketplace. Learn how the U.S. will become more competitive.