This is the answer from the FAQ http://www.fairtax.org/site/PageServer?pagename=about_faq_answers#47 but basically it's 23% of every dollar the customer gives you is tax, but if you look at the receipt it's a 30% sales tax. The link explains it better than I can.

The difference between this and VAT is that it is simpler in that it only taxes final sale not every stage in between, replaces our current income tax structure instead of subsidizing it (as yours likely does), and uses our existing tax collecting infrastructure (state sales taxes). Because it is only taxed at the final point of sale, the burden on companies is less*.

It isn't a normal VAT, and it isn't so much groundbreaking as simplified. Our current income tax system is a complicated mess and nearly universally loathed by those who can't afford to have their taxes done by a professional. VAT's show that this sort of tax system can work, and since the FairTax is actually a simplified version, would be even better. There is a correlation between the difficulty of complying with tax codes and the compliance rate.

(*) Apparently the forms and whatnot of VATs is pretty complicated, but not having them here I can't say for certain.