The Fair Tax is a proposed federal sales tax on new consumer goods. It would not apply to basic essential items such as food and diapers, nor would it apply to used items. So this would encourage conservation when we need it most. Under the Fair Tax system, it would be theoretically possible for a middle-class person to go without paying any federal taxes at all so as long as he only buys used items and doesn't own a car.
This raises the value of used goods, which has several benefits:
1. People will take better care of the things that they already own.
2. They would receive more money in return when they pawn or resell a used item.
3. Less energy and resources are used, bringing down the price of oil.
4. We import fewer goods from overseas, reducing or even eliminating the trade deficit.