Democrats hammer Republican plan to impose national sales tax, abolish IRS

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Democrats are seizing a Republican proposal to impose a national sales tax and abolish the Internal Revenue Service as a club against the Republican Party, although the bill has few supporters, even among Republican lawmakers.

The Fair Tax Act, sponsored by Representative Earl L. “Buddy” Carter (R-Ga.) and introduced this month, would eliminate taxes on income, payroll, estate, and gifts and instead impose a national tax on sales of 23%. It would also eliminate IRS funding after the 2027 tax year.

character told Fox Business on Tuesday that people “would rather have a consumption tax” when they have a choice.

“Actually, you would see … what you’re actually earning every week in your paycheck,” Representative Andrew S. Clyde (R-Ga.), another supporter of the bill, said this month.

On Tuesday, Speaker of the House Kevin McCarthy (R-Calif.) appeared to answer to a question about whether he supported the Fair Tax Act, telling reporters simply, “No.” Representatives for Carter and McCarthy did not respond to requests for comment on Wednesday.

In an op-ed for the Atlantic this week, anti-tax conservative Grover Norquist criticized the reintroduction of the Fair Tax Act as “a free gift to Democrats” and warned the GOP against allowing a small minority of House Republicans to force a vote on this.

Norquist also expressed concern that such a national sales tax, and its accompanying monthly sales tax rebates for US citizens, would essentially create a universal basic income.

“The ads you might run are that so-and-so wants to add a 30% sales tax on [prices], which will be devastating for middle-income people. That’s a pretty crass announcement,” Norquist told Hill.

These announcements effectively began, in the form of attack lines from the Democrats and the White House. At a joint news conference on Wednesday, Senate Majority Leader Charles E. Schumer (DN.Y.) and House Minority Leader Hakeem Jeffries (DN.Y.) criticized the Fair Tax Act, saying that would result in dramatic tax increases for nearly all Americans, create a particular burden for seniors, and “wreck” Social Security.

“The so-called ‘Fair Tax Act’ is unfair, unscrupulous and un-American. It will impose a dramatic tax increase on 90% of the American people, working families, middle class people, seniors and aspiring middle class people, the poor, the sick and the afflicted,” Schumer said.

Jeffries pointed out that older Americans who had already paid the system over their lifetimes in income taxes would be “double and triple taxed” by a national sales tax.

This legislation is extreme and is functionally the GOP fiscal coup, part two,” said Jeffries. “We are going to expose him and… do everything we can to stop him.”

Schumer said such a “doozy” plan would never pass the Senate as long as he was the House Majority Leader. He also defended the Democrats’ ardent early warnings — though the bill is almost certain to die — saying there was still a possibility the plan could gain traction within the GOP with support from far-right Republicans.

“Everyone thought that Leader McCarthy would never go along with the MAGA Republicans while he was running for president,” Schumer said, referring to the concessions McCarthy made to far-right strongholds in his bid for president. “I do not underestimate the power over McCarthy of these radical MAGA Republicans. We have to fight this plan now, before it gains any more momentum. Many Republicans support him.”

President Biden is expected to make the proposal a major issue in an economic speech on Thursday in Virginia. The White House has regularly attacked Republicans for suggesting changes to Medicare and Social Security, trying to paint the Republican Party as out of touch with ordinary Americans.

“These guys are fiscally insane,” Biden said of Republicans in remarks at a Martin Luther King Jr. Day event. last week.

Scattered support for the Fair Tax Act among Republicans is reminiscent of tensions within the Senate GOP last year after Senator Rick Scott (R-Fla.) released an “11-point plan to rescue America” ​​that included a proposal for all Americans to pay some form of income tax, and after Senator Ron Johnson (R-Wis.) suggested that Social Security and Medicare be eliminated as entitlement federal programs and instead be turned into programs approved by Congress annually as discretionary spending.

Both proposals drew criticism from several prominent Republicans, including Senate Minority Leader Mitch McConnell (R-Ky.), who told reporters categorically that the GOP “will not have as part of our agenda a bill that increases taxes on half the American people and the Social Security and Medicare sunset within five years.”


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