I just read Mike Dickson's letter (Accounting Today, Nov. 28-Dec. 18, 2005, page 7). My concerns are three-fold.First, making the poor pay the tax up front and then at a later date refunding their money: Some of these poor don't even file now, wouldn't have a clue how to file and may not file for the refund to which they are entitled, even if a free filing service is offered to them. The bottom line is that the poor will get poorer.

Second, it sounds like rather than the many collection points for collecting payroll taxes today, the FairTax would put the collection in the hands of fewer collection places, more specifically retailers. I'm sorry, but that seems like a lot of cash being made available to thieves. How do you go about collecting money from clever folks who'll have the money overseas before the government collection people even get wind of the theft? It sounds like we'd be putting the fox in the hen house.

So much of what our legislators pass as law is done without any forward-thinking about how the mechanics of their actions will be put into place. It's dumped into the Internal Revenue Service's lap and they have to interpret and enforce what was ill-conceived.

Unless all sales were to be made not with currency, but rather a credit card type-strategy, so funds would be all transferred electronically from banks to the U.S. Treasury, what's to prevent terrorists or other evil-minded people from having a field day out there? I sure wouldn't want to be working retail. It might well become the most dangerous job to have!

And just one group of genius hackers could have a nice windfall diverted overseas and bankrupt our country if they figured out all the checks and codes of the currency system that would be employed. This method doesn't seem feasible either. And if we went to a credit card system, how would we ever teach our children to save in their piggy banks?

I'd love someone to explain to me a fool-proof system that loses the government less money than what's already lost through the many who currently don't pay their fair share in taxes.

Third, at what rate would this "fair" tax be? From what I've seen, it would have to be between 23 percent and 30 percent, and that doesn't even include the Social Security, Medicare, and state and local taxes that people would still have to pay. And who's going to sell this package to the overtaxed public? I took three of my middle-class clients and redid their tax returns using one of the FairTax models and the standard allowances proposed. In each case, they ended up paying more than they pay now. How can the "FairTax" be fairer than what we have now, when the poor will just get poorer, the rich will get richer and, as usual, the middle class will pick up the balance?

There is no one shoe that will fit all. This is how our current tax system got so complicated. When legislators tried to enact exceptions for those who wear larger or smaller shoes, the code grew to outrageous proportions. I don't have any solutions to offer. All I can say is that the "FairTax" I've read about is even less fair than the tax system we currently have, in my opinion.

I'd love to see a fair tax. But my concern is, how would the Treasury actually receive these funds to efficiently run our great country?

I'll end by quoting the IRS's Mission Statement: "To provide America's taxpayers with top-quality service by helping them understand and meet their tax responsibilities and by applying the tax law with integrity and fairness to all."

Arleen Mundy

Commerce Township, Mich.

After reading the letters from Steve Harris and Mike Dickson, I visited the FairTax site and came away confused on a couple of basic issues.

First, what rate of tax would be revenue-neutral? I note that the FairTax site suggests 30 percent, while a New York Times writer believes that 40 percent is more accurate. Where can one get dispassionate data on what is likely to be the revenue-neutral tax rate should the FairTax be adopted?

Also, I have learned over the years that virtually every tax change yields winners and losers. Obviously, the investor class in general would be winners, and those who spend more than their income likely would be hurt.

Probably the reality is more complex, and I would be interested in Messrs. Harris and Dickson's analysis of those likely to pay more tax under the FairTax than under the current tax regime.

Doug Hollingsworth

Bangor, Maine

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