Isn't it time for a consumption tax?

In a recent discussion, a tangent regarding tax policy developed in which I stated that I would support a consumption tax, much like the FAIR Tax, but with a couple of caveats, changes that I would make.  This post will describe the tax I would implement to replace the income tax.

Basic Structure:
The Consumption Tax (CT) that I would create would not have a set percentage rate, but would have a "base rate" set each year (automatically, no ability for politicians to interfere) to generate the amount of money spent by the federal government plus five percent.  This implementation has a couple of goals, the first of which being a balanced budget and the second being a plan to retire the debt over time.  In addition, setting the tax rate based on last year's spending would create a completely transparent system of taxation as everyone would be completely aware of government spending because the base rate would rise with increased spending.

Exemptions:
I would give every adult a $5000 annual tax exemption and the parents of dependent children $2500 for each child.  This exemption would be implemented using the same infrastructure that currently exists for food stamps and flex accounts.  I would exempt food and medicine from the tax and, after the debt is paid off, would give a CT holiday every year at back to school time, much like Texas does already.

Application:
The CT would apply to new goods and would not be charged on used items.  Refurbished goods would only be taxed on the value of the new parts used to refurbish the item.  Applying the tax only to new goods would give people a market in which they could avoid the tax altogether if they wanted.  This application would also encourage the production of more durable goods as such products would hold their resale value.  It is likely that such a system would encourage more recycling of products rather than the production of disposable goods that are so prevalent today.

Optional component:
It is my opinion that some goods should have higher tax rates applied to them than other goods due to the potential for societal damages or costs that are higher.  The prime examples would be tobacco products (which cause cancer, leading to higher healthcare costs for people who use these products).  For such products, I would allow for a "tax multiplier" to be applied.  If the tax multiplier were 1.5, then the base tax rate would be multiplied by 1.5 to calculate the total tax rate for that product.  This kind of system would ensure that tax rates would be completely transparent if the product in question was taxed at a higher rate than the base rate.