Letter endorsing the FairTax (in 2004, the bill is now H.R. 25 in the House and S.1493 in the Senate)
Letter
July 23, 2001
The Honorable John Linder
1727 Longworth House Office Building
Washington, DC 20515
The Honorable Collin Peterson
2159 Rayburn House Office Building
Washington, DC 20515
Dear Congressmen Linder and Peterson:
On behalf of the 335,000-member National Taxpayers Union (NTU), I write to offer our endorsement of H.R. 2525, the FairTax, and to urge all Members of Congress to join as cosponsors. Should H.R. 2525 come before the House for a vote, it will be heavily weighted in our annual Rating of Congress.
America�s present Tax Code is extremely punitive and complicated, taking more from American taxpayers than ever before. The current Tax Code is clearly not what the nation envisioned when it ratified the 16th Amendment nearly 100 years ago.
Initially, rates were extremely low. In fact, the tax rate on the first $20,000 of income was a mere one percent, while the highest rate was still a fairly reasonable seven percent on all income above $500,000. In 2001 dollars, that would equate to a one percent income tax on all income up to $300,270 while the seven percent rate would apply only to income earned above 7.2 million dollars. Clearly, our current system of extreme progressivity would come later. In fact, as late as 1939 only five percent of the population was required to file income tax returns.
Today, the federal income tax is extremely �progressive� in the worst possible sense of the word. Dangerously burdensome on both the taxpayer and the economy � and maddening in its complexity � it has become a detriment to America�s economy.
While the extreme progressivity of income taxes is inherently unfair and unquestionably slows our economy dramatically, the regressive nature of our current payroll taxes unquestionably hurts those who can least afford to pay them. As you are aware, while the poor in America may not pay excessive income taxes, they are taxed excessively by payroll taxes.
Because your FairTax would replace both the income and payroll taxes with a simple, fair, 23 percent sales tax with monthly rebates, it would greatly benefit all Americans and our national economy.
Most Americans agree that our current Tax Code is in desperate need of reform. We salute you for your effort to bring about such reform and urge your fellow Members of Congress to join you in this effort by working to pass H.R. 2525.
Sincerely,
Eric V. Schlecht
Director,
Congressional Relations