FairTax Act of 2025

Summary

FairTax Act of 2025 This bill replaces federal income, payroll, estate, and gift taxes with a federal sales tax beginning in 2027 and eliminates the Internal Revenue Service. The bill establishes a 23% tax-inclusive (30% tax-exclusive) federal sales tax rate on taxable property and services to be administered primarily by each state. The federal sales tax rate is adjusted annually beginning in 2028 so that it is the sum of the  general revenue rate (14.91%); old-age, survivors and disability insurance rate; and hospital insurance rate.  The bill includes exemptions for property or services purchased for business, investment, and certain state government functions. Registered, qualified families may receive a monthly sales tax rebate in the amount of the monthly federal poverty level (or twice such amount for married individuals) multiplied by the federal sales tax rate. Each family member must have a Social Security number and be a lawful resident of the United States.  Federal sales tax revenues are allocated to general revenue, the Social Security trust funds, and the Medicare trust funds. (Special allocation rules apply for 2027.) The bill eliminates appropriations for the Internal Revenue Service after FY2029 and establishes an Excise Tax Bureau and a Sales Tax Bureau within the Department of the Treasury.  Finally, the bill terminates the federal sales tax if the Sixteenth Amendment to the Constitution (authorizing a federal income tax) is not repealed within seven years from the date the bill is enacted.

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Timeline

1. 3 January 2025

   Introduced

   Referred to the House Committee on Ways and Means.

   Source: IntroReferral

2. 3 January 2025

   Introduced

   Introduced in House

   Source: IntroReferral

3. 3 January 2025

   Introduced

   Introduced in House

   Source: IntroReferral

Votes

No vote records are attached yet.

Versions

No version snapshots stored. Document URLs remain at the source.

Documents

2 official files

• Introduced in House

  Introduced in House · EN · 3 January 2025

  DownloadOpen at official source

• Introduced in House

  summary · EN · 3 January 2025

  Open at official source

Sponsors

• Rep. Carter, Earl L. "Buddy" [R-GA-1] · R · Sponsor
• Andrew Clyde · R · Sponsor
• John Carter · R · Sponsor
• Scott Perry · R · Sponsor
• Rep. Burlison, Eric [R-MO-7] · R · Sponsor
• John Rutherford · R · Sponsor
• Rep. Davidson, Warren [R-OH-8] · R · Sponsor
• Rep. Biggs, Andy [R-AZ-5] · R · Sponsor
• Dale Strong · R · Sponsor
• Rep. McCormick, Richard [R-GA-7] · R · Sponsor
• Barry Loudermilk · R · Cosponsor
• Andy Harris · R · Cosponsor
• Rep. Harris, Mark [R-NC-8] · R · Cosponsor
• Mike Collins · R · Cosponsor
• Barry Moore · R · Cosponsor
• · hswm00 · Standing

Related records

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