Economist Steven Landsburg has a new article in Slate magazine in which he gives his approval to Huckabee’s Fair Tax plan. His conclusion:
the underlying issue becomes a lot clearer once you realize that a sales tax is a modified income tax. The right question is: Is the proposed modification a good one? The answer, according to a growing consensus among macroeconomists, is: Yes.
What’s even more interesting about Landsburg’s endorsement of the plan is the rather obvious distaste he has for Huckabee’s Christianity. His approval is grudgingly given because of his evaluation of the idea’s merit; therefore, the highest form of endorsement.
Referring back to a previous Republican debate, Fred Thompson indicated that he would not be opposed to the plan on principle. But Thompson was concerned about the possibility of ending up with both a consumption tax AND an income tax, the worst possible outcome for Americans.
Personally I like the idea because it distributes the tax burden based on consumption, allows fewer loopholes than the present system, and government tax increases cannot easily be hidden in arcane language, an important factor in my mind.