Why in the world would our politicians agree to give up so much power, defined as control the flow of money, just to make it fairer to the citizens of this country?
I think they would only do it if their elections depended upon it. It would take a lot of people demanding it in a politically effective way. The organization now doing this
(http://fairtaxgroups.com/) is making quite a bit of progress, given the heavy special interest pushes against it. The respective bills in the House and Senate have more co-sponsors than ever before. Some are Democrats, some are Republican (most are Republican).
Republican candidate Mike Huckabee is a big supporter of the plan, and his campaign is giving it a lot of publicity. Good.
It would bring a lot of jobs and industry back to the US. Many businesses could be competitive again if the embedded payroll taxes and income taxes were removed from the cost of labor. Plus, the elimination of corporate income taxes would increase te amount of money available for investments in productivity improvements (making us more competitive) and increase the size of dividend checks (any stockholders here opposed to that?) Elimination of these embedded costs is why the cost of most goods and services (before taxes) would decrease, largely offsetting the tax in many cases.
Yes, think most folks could retire earlier under this system. What I like best about it is the simplicity and the transparency of it. Supporters do tend to gloss over a few issues, but they can be easily addressed and are minor compared to the mess we have now.
There's quite a bit of opposition to the idea from folks in the ER community. Many look at the taxes they've paid on their IRAs and want credit for that--they want te tax-free money they were promised. Okay, so you'll have to pay taxes on what you buy with that money--but everyone seems to believe they are somehow "making out" under the present system (mortgage deduction, shady business expenses, etc).
On a pragmatic, month-to-month basis I think most ER types would do very well. The "pre-bate" is a nice-size check that goes to everyone (the poor pay no federal taxes under this plan--just like today, because of the prebate), and there's no tax on used goods. Most of us who are not big consumers would do well.
But I agree with anyone who says it will be an uphill battle.
This topic as been discussed here a few times before. Search under "Fair Tax" or "NRST" for more.