Final you are right. George W. Bush as FAILED as a President to secure the borders. He wanted to push through the amnesty bill and we the people stopped congress from passing that horrid idea. Bush has continued to fail in the area of Border Security. I hope the next President will build that border fence within 6 months of being in office. If he (God forbid she) doesn't, then all bets are off and hell will break loose in the amount of fury that the government will face from me, and the majority of the country.

Now back to the FairTax

 See this is where the government should outsource this prebate responsibility. Private business wants to make money and so they will be the most efficient dollar for dollar. (this is not always the case, so don't bring it up. it is a general truth however.) All they would need to do is check the validity of a Social Secuirty number and send money to an account that is loosely based on the number of valid Social Security Numbers.

The government takes a census through the mail correct? And if they need to verify information they will either show up at your door or call you. They could include the FairTax registration with the next Census of 2010.

If Private Business is responsible for the running of this "Prebate Commission", as you call it, they would just need to create a few routines before they accept a new applicant. 

1) Check for Citizenship status.

2) Check for unusual behavoir patterns, eg. a family is having a baby every 3 months.

Each business sends the collected FairTax to the state they are in. The States would be responsible for the oversight of each business as they are now. If a business claims that they took in $100,000 for that month, then they would be required to send in $23,000 to the State for the FairTax. The States then pass the FairTax onto the Treasury Department.

Since the FairTax is transparent and simple, the evasion of the FairTax will be down from the current evasion level. Now there will always be tax evaders. But since it is easier to collect and process the FairTax, the agents that track and prosecute the tax evaders will have a much easier job. They will only have to focus on a lot fewer people that they would have to pay attention to. 

"Yet it remains the case that 80% of the sales tax collections will come from about 20% of businesses -- including the national and regional retailers -- and I doubt that Wal-Mart or Home Depot or your local hospital is going to risk jail time to help you." from the FairTax Book.

Also, I eagerly await your responses to the rest of the critical posts and questions.

Basically what i was going to say. Thats why europe went with a VAT. The tax is more evenly distributed along the supply chain so there is no benefit to fraud it. The Fair Tax system would be extremely easy to fraud. Who is going to go to jail at Wal-Mart if they do get caught frauding, the corporation heads or the managers who are ordered to do it by the corporation heads? What is the likelyhood of them seeing jail time? (Since CEO's hardly get charged with anythign they pull as it is.)

Who's to say they would do it for the consumers benefit exclusivly, who's to say a portion of these sales won't be used to line their own pockets. In Wal-marts case, allowing them to give slightly power prices while gaining greater profits.

Or just in general saying items were sold for less then they really were, so they can keep a larger percentage of the profits. Considering how objects drop in price over the time, i could see items being sold, and yet kept as "phantom stock" until a pricedrop allowing them to keep extra tax money. Of course this is only beneficial for those huge corporations.

Also private buisness that wants to make profits handling something for the good of the people does not work.  That's how you get flop houses for mental patients and the like.

 What are you talking about here? The company that is providing the service of the Prebate?

If that is what you are talking about there are a number of ways that they could make a profit doing this service, especially if that company is a bank or credit card company. That company could use the name recognition to boost sales or investments or loans or applications for credit. It is not like the government would pay them for managing this for them.

You make it seem like they would try to shaft people from the tax rebate they would get. If they even thought about trying that people could complain to the Treasury Dept. and start an investigation. If they were found guilty with any excuse besides a one-time negligence then they could be stripped of the job and that would cost them prestige and trust in the eyes of the public. That would cost them money.  

 You mean the negative name recognition when people complain their checks don't come soon enough?  Otherwise they are just doing there job and people won't care.

 I don't see any company willingly doing this and spending there own money just to get bitched at and have people calling when there checks don't come exactly on time... or it a lot of cases early.

For starters I think "Compliance" portion would go way way down.  The sheer reduction in paper work and complexity would make the audit process infinitely more efficient, but as you can see there are other areas where it could be improved.  I won't claim they could eliminate it entirely but I would expect massive reductions just from the reduction in complexity alone.  Audits now are lengthy and a pain in the ass due to the sheer number of considerations required, these considerations would be reduced more than ten, probably twenty or thirty, fold.  

@the person who complained about IRS people losing jobs,

Is your argument that a horribly flawed system should remain so that an extremely small portion of the population won't have to find another job?  

 The FairTax has several features that make it difficult and very risky for persons to have a scam business in order to purchase items tax free. First, in order for any person to purchase items tax free for business purposes, the business has to be a registered seller and possess a registered seller certificate issued by the state sales tax authority. Registered sellers are expected to file monthly or quarterly sales tax returns with the state (depending on sales volume). The certificate enables the business to purchase tax free from wholesale vendors, but the vendor must retain a copy of the registration certificate to justify not having collected tax on the sale. When a business purchases items for business use from a retail vendor, they have to pay the tax on the purchase and take a credit against the tax due on their monthly sales tax return. They must keep invoices/receipts to document what they purchased and the amount of the purchase. They might also make note of the purpose of the purchase on the invoice.

Also, as registered sellers, they are subject to the possibility of being audited by the state. During such an audit, they will have to produce the invoices for all the “business purchases” that they did not pay sales tax on and will have to be able to show that they were bona fide business expenses. If they cannot prove this, then they will have to pay the taxes that should have been paid when the items were purchased, plus interest and penalties. The probability of being audited will be much greater than it is under the current system with its over 140 million tax filers. Under the FairTax, there will be less than 20 million businesses that will be filing sales tax returns and thus subject to the possibility of being audited. Thus, the probability of tax cheats getting caught will be much greater than it is today, making tax evasion riskier than it is today. Additionally, while the FairTax has much stronger taxpayer rights than does the current tax system, the FairTax legislation provides for a number of fines and penalties for noncompliance. It also authorizes a mechanism for reporting tax cheats and obtaining a reward. An example would be 1-800-TAX-CHET.

Another potential scam would be to have a “fake” family business in order to buy things for family members tax free. The FairTax has a specific provision to prevent this. Although it does not prohibit businesses from providing taxable property or services as gifts, prizes, rewards, or as remuneration for employment, the gift, reward, etc. is considered to be the conversion of property or services from business use to personal use and is therefore taxable. Likewise, there is a similar provision to prevent abuse of employee discounts. Under the FairTax, employer-provided employee discounts over 20 percent are taxable. The term “employee discount” means an employer’s offer of taxable property or services for sale to its employees or their families for less than the offer of such taxable property or services to the general public. If the employee discount amount exceeds 20 percent of the price to the general public, then the sale of such taxable property or services by the employer to the employee is considered the conversion of property or services to personal use and is subject to tax. The taxable amount is the amount by which the discount exceeds 20 percent of the price to the general public.

-From fairtax.org

This should have answered your question.

The idea that the company will not reduce the prices once the FairTax is implemented is a myth. The capitalistic marketplace would ensure that the companies would keep prices as low as possible while still turning a profit. 

Currently there is an embedded tax of about 22% in every thing we buy. This embedded tax is the Corporate Taxes, Payroll Taxes, etc. that the government collects from companies already. They want to make a profit so they pass the costs of the taxes and the cost of tax compliance on to the customers in the form of higher prices. This 22% is already an INCLUSIVE tax and would simply be replaced by the FairTax rate of 23% INCLUSIVE. Therefore the prices will stay about the same as they currently are. The cost of Tax Compliance is a fairly large portion is relation to how much income it provides to a company (hint: it helps bring in less than $1).

The cost of Tax Compliance for our entire country in the year 2005, 6 billion hours of individuals, businesses, and nonprofits. This effort added up to about $265 billion spent in COMPLIANCE ALONE! With this information we could assume that prices would go down since Compliance costs of the FairTax is a tiny fraction of what it currently costs. These costs would set off other price decreases for the consumer.