AUGUSTA, GA. - My old buddy Corey Pein is going out with a bang — an unbalanced and incomplete bang, but a bang nonetheless.

Space limitations will not allow me to dissect Pein’s cover story on the FairTax thoroughly, but I can summarize the main complaints that I and many others have voiced about the article.

For the uneducated, the FairTax would replace all income-related taxes with a point of purchase sales tax on all consumer goods and services.

The article begins by suggesting there will be a 30 percent increase in the retail cost of every good and service on the market. Pein wrote: “If your rent was $500, you’d now pay $650 — an extra $1,800 a year.” And that came after a sub-headline that mentioned the FairTax and the infamously racist “poll tax” in the same sentence.

And some say talk radio is full of inflammatory rhetoric?

 

No subjective look at any FairTax proposal can mention that 30 percent mark-up without immediately mentioning that most (if not all) of the increase will be negated by the elimination of all imbedded income, inventory and payroll taxes. There is honest disagreement over the percentages involved, but Pein waits until he is halfway through the article before he even mentions the huge cost reduction that will trickle down to the checkout counter. An intellectually honest analysis has to take into account some reduction of consumer prices at the point of purchase.

 

The primary point barely touched in Corey’s piece is the fact that a national consumption tax will bring millions of tax cheats and deadbeats to the table. Experts say that our current system, through inefficiency and criminal fraud, leaves at least 30 percent of the government’s legitimate income out of play. Can you imagine a minimum of 30 percent of your legally earned income being lost in the ether?

 

A national consumption tax (not a flat tax) is the only reasonable way to get traditional tax cheats (and yes, illegal aliens, prostitutes, drug dealers and Mafioso) to pay any kind of income tax at all.

 

Getting all tax-owing citizens to the table will lower the tax bill for everyone. This is complete common sense, and it is a point almost completely ignored in last week’s cover story.

 

The story included a mention (not a quote) that Georgia Revenue Commissioner Gary Graham has said there are more sales tax cheats in the state than income tax cheats. That is a claim (if he made it) that is virtually impossible to prove, akin to estimating the number of people who commit murder that “get away with it.” More people are prosecuted for sales tax cheating, because it is far easier to prove.

 

If Draconian penalties are put in place, such as inventory and property confiscation, business license forfeiture and imprisonment, I bet the noncompliance rate would drop like a rock. With the huge increase in credit and debit card transactions in all businesses, cheating the old fashioned way is more and more difficult every day.

 

Finally, Pein used your “neighbor’s college-aged daughter” as an example of a put upon young babysitter who will be forced at the end of a gun to declare herself a “business” and remit her owed tax to the government. He said that at $25 a week, she would have to pay because she makes more than the $1,200 a year mandated as minimum income under whatever Fair Tax proposal he is quoting.

 

Currently, Federal law commands that anyone paying an individual $600 or more a year declare that person and their Social Security number to the IRS so the appropriate payroll taxes (Social Security and Medicare) may be levied. By the way, the “employer” gets to deduct that as a paid wage on their income taxes at the end of the year. That same rule applies to “cash and carry” yardmen, pool boys, cabana girls, you name it.

 

The current FairTax bills circulating on Capital Hill are works in progress. None are perfect, but most stand head and shoulders above the current income tax system in fairness and enforceability. I know of no serious push to get any of these bills passed tomorrow, but we do need a serious and complete national dialogue on the issue, if for no other reason than to fix the “abortion” of a system we have now.

 

The “rich people” that Pein named throughout his story all have one thing in common: They spend huge amounts of money. Under a consumption tax, they would pay their fair share. Far more than most of them can be held accountable for now under our hideous and corrupt income tax system.

 

I happen to work for a very rich man, and contrary to popular belief, he has helped make it possible for me and a whole lot of other “middle class people” to do well. I hope he gets to keep all the money he possibly can, so he will be in a much better mood when I ask him for a raise. Or even better, he will have more to invest in my business when I go out to make my own fortune.

 

Could any of these points be covered in the Metro Spirit’s cover story?

 

Next time, Pein, try to at least pretend to be neutral — or at least openly declare yourself a partisan hack like I do. Have a great life out on the Left Coast, you are going right where you need to be.