The 60 Second Update with

Congressman John Linder

5. Why is the FairTax better than the Flat Tax?

It is important to note that our income tax system began as a flat tax, but throughout the past 90 years it has morphed into the system we have in place today.  We flattened the tax code in 1986, and since then we have amended the tax code more than 16,000 times.

While I believe that a flat tax would be an improvement over our current system, I believe a personal consumption tax would be clearly preferable to a flat income tax.  A tax on personal consumption would be considerably simpler to administer than an income-based system and would therefore make it much easier for taxpayers to pay their taxes.  There would also be less opportunity to manipulate the system to avoid compliance.  Even illegal income, such as drug money or money received by illegal immigrants from their employers, would be taxed, as the money would eventually be spent.

Question 1. What is the Fair Tax and why do you call it that?