Op-Ed: The MAGA Republican “Fair Tax Act” is Anything But

It is time for Congress to step up and make corporations and the ultra-wealthy finally pay their fair share. Fighting for greater economic equity for American working families and the middle class should be a core priority for every member of Congress.

That’s why I am working every day to fight against the new House GOP majority’s so-called “FairTax Act of 2023.” This bill would impose a 30% federal sales tax on goods and services, increasing taxes on the poor and middle class and driving up costs on groceries, gas, healthcare, and other essential services.

The Unfair Tax Act is a thinly veiled attempt by the GOP to give a tax cut to the wealthy by significantly increasing the financial burden on working families, the middle class, and seniors. A federal sales tax would be a regressive tax, which disproportionately burdens low- and middle-income households. When similar legislation was proposed in 2006, an executive panel found that such a tax would create a sharp increase in the taxes paid by the middle class. Retirees, large families, and students would also see a large tax hike on consumption while not benefiting from the tax cuts.

Additionally, this legislation would not only raise taxes for hardworking Americans, but also increase the federal deficit. According to the Congressional Budget Office, in 2021, federal taxes raised a combined $3.8 trillion in revenue, and, over the next ten years, these federal taxes are projected to raise $53.5 trillion. The proposed 30% sales tax would fall far short of current projected tax revenues, increasing the federal deficit by about $10.6 trillion over 10 years. That’s money that could pay for better healthcare, transportation, education, and more all gutted to support tax cuts for the super-wealthy.

Instead of driving up costs for working families to help billionaires, I’m focused on making the wealthy pay their fair share so we can support tax cuts for the middle class. That’s why I am a cosponsor of the “Billionaire Minimum Income Tax Act” (H.R.8558), which would require taxpayers worth over $100 million to pay at least a 20 percent tax rate on their full income, including unrealized gains. I was also proud to vote for the Inflation Reduction Act (H.R.5376) when it passed through the House by a vote of 220 to 207 on August 12, 2022. This critical legislation will implement a 15% corporate minimum tax on corporations with $1 billion or more in average annual earnings and impose a 1 percent excise tax on corporate stock buybacks while also addressing the $160 billion gap resulting from tax evasion by the top 1 percent. These provisions will ensure that the wealthiest Americans and corporations pay their fair share without increasing taxes on working families and small businesses.

I will continue to build upon the successes like the Inflation Reduction Act to support hardworking Americans. I will also always speak out against efforts like the Unfair Tax Act that would stymie the progress President Biden and Congressional Democrats have made to support our economy and working families.

By Congressman John Garamendi (D-CA 08)