Taxing consumption rather than 'income' would certainly solve the problem of a narrowing tax base. It would even allow the central state to maintain it's social engineering habits while checking it's excesses. Everyone has 'skin in the game' when it comes to consumption even the the taxers, the criminals and the muni bond clippers. Everyone pays the payroll tax, btw, calling it a 'payroll tax' rather than an income tax doesn't change the fact that's it's a 15% tax on 'income'. The tax on 'income', whatever that means, has become a system of double taxation and worse where certain taxes are taxed, post tax assets are taxed while the rules are almost incomprehensible, ever changing and completely arbitrary. It's an entirely idiotic system.

Can't vote if you don't ante-up. What a notion! Goodbye trillions on entitlements which would force all the able bodied to work and therefore contribute to the tax rolls, which would then add them to the voting rolls ...

If only.

I love how they describe the Tax Foundation as a "non-partisan, conservative-leaning research group." If it were liberal-leaning, they would have called it a "think tank."

I was just about to make the same point.

The so-called "Fair Tax" needs to be tweaked to become palatable, and the tweaking may just make the "Flat Tax" a better bet.

First, the fair tax people misrepresent the 23% figure on their site. It's 30% at the cash register (which is all people care about).

I'm not sure the 50 million who aren't paying income tax are going to enjoy every stinking thing they buy, from cars to houses, going up 30%.

Next, the Fair tax "funds" the current Social Security system. Bad idea. Strip SS and have it paid for by payroll deductions to a personal account, and you can lower that 30% signficantly.

What we have, unfortunately, is Conservatives being victims of their own success. They crowed about all the people taken off the tax rolls. Cool, but you now have a huge constituency of people who will hate both the fair tax and flat tax plans.

And at the same time, the we hear stories how the Alternative Minimum Tax (AMT) is hitting a greater percentage of those who do pay taxes. Lower the AMT rate, and you've got your "flat tax". And at that point, we won't need to scrap the old system because no one will be using it.

Bruno- Don't buy it if you can't pay for it. TSavings should go untaxed. I respectfully disagree if you believe that taxes have no effects on behavior. Taxing productive behavior, like saving or working is the worst possible policy. The current system taxes the ever changing defintion of income in the name of 'economic justice' rather than the necessary funding of government. Wealth is not taxed. Income is taxed. Remember, 'income' is whatever the taxing power says it is. Consumption is an objective reality. No system of taxation can be perfect but a more perfect system would encourage work, saving and investment while presenting choices rather than coercion to taxpayers, the choice of saving versus consumption being the most important. One of the side effects of the current system is the stark contrast created between the interests of the individual and the interests of the taxing power. Real inflation, not reported inflation, is only one of the results of the current system. Another is the craze for debt financed consumption particularly through the tax treatement of home equity extraction for consumption. Stupid, counterproductive behavior actually encouraged through tax rules. Saving and investing increase productivity and competetiveness through capital formation. The current system actually discourages capital formation and is dependent on coercion rather than free economic choices.