25 percent National Sales Tax (VAT) coming to USA?

VAT (value added sales tax) - Value added tax (VAT), or goods and services tax (GST) is a consumption tax levied on value added. In contrast to sales tax, VAT is neutral with respect to the number of passages that there are between the producer and the final consumer; where sales tax is levied on total value at each stage, the result is a cascade (downstream taxes levied on upstream taxes). A VAT is an indirect tax, in that the tax is collected from someone who does not bear the entire cost of the tax.
en.wikipedia.org...

I've seen a few things on this today...some of it on television...here is the article where I first heard about this....

Once Considered Unthinkable, U.S. Sales Tax Gets Fresh Look

"There is a growing awareness of the need for fundamental tax reform," Sen. Kent Conrad (D-N.D.) said in an interview. "I think a VAT and a high-end income tax have got to be on the table." A VAT is a tax on the transfer of goods and services that ultimately is borne by the consumer. Highly visible, it would increase the cost of just about everything, from a carton of eggs to a visit with a lawyer. It is also hugely regressive, falling heavily on the poor. But VAT advocates say those negatives could be offset by using the proceeds to pay for health care for every American -- a tangible benefit that would be highly valuable to low-income families.

What would it cost? Emanuel argues in his book that a 10 percent VAT would pay for every American not entitled to Medicare or Medicaid to enroll in a health plan with no deductibles and minimal copayments. In his 2008 book, "100 Million Unnecessary Returns," Yale law professor Michael J. Graetz estimates that a VAT of 10 to 14 percent would raise enough money to exempt families earning less than $100,000 -- about 90 percent of households -- from the income tax and would lower rates for everyone else. And in a paper published last month in the Virginia Tax Review, Burman suggests that a 25 percent VAT could do it all: Pay for health-care reform, balance the federal budget and exempt millions of families from the income tax while slashing the top rate to 25 percent. A gallon of milk would jump from $3.69 to $4.61, and a $5,000 bathroom renovation would suddenly cost $6,250, but the nation's debt would stabilize and everybody could see a doctor.

"Everybody who understands our long-term budget problems understands we're going to need a new source of revenue, and a VAT is an obvious candidate," said Leonard Burman, co-director of the Tax Policy Center, a joint project of the Urban Institute and the Brookings Institution, who testified on Capitol Hill this month about his own VAT plan. "It's common to the rest of the world, and we don't have it."

"There is a growing awareness of the need for fundamental tax reform," Sen. Kent Conrad (D-N.D.) said in an interview. "I think a VAT and a high-end income tax have got to be on the table."

www.washingtonpost.com...

There was also a video piece of this on Neil Cavuto today but I've been unable to find the video to post here.



I find this a bit hard to swallow. Jacking up prices on EVERYTHING we buy by 25 percent would be F'n insane!

I know they are going to raise taxes and inflate our currency...but I was hoping it wouldn't be this nasty...

The American people will never go for this...you cannot raise prices like this an expect people to not be rioting in the streets.

This would be a tax on everyone.

Imagine for a moment..going to the store tomorrow...and seeing all prices going up 25 percent and not being able to do a damn thing about it!

Is this how bad it's become?

[edit on 27-5-2009 by David9176]

Seems I have heard these self same arguments of it being for the greater good once before....

Ah yes, the original tax table from the IRS for Federal Income Tax. In that anyone making under $5000 per year was exempt. Great idea, the masses went for it because at the time $5000 per year meant that you were quite well off.

Except they never, ever adjusted that $5000 per year for inflation and the value of a dollar. Currently I would estimate that original $5000 cutoff to be between $50K-65K.

Yep, let's go on ahead with that $100K cap crap, right? But since the Federal Reserve has been cranking out the dollar bills so fast that you can see the smoke rising from the presses while on the moon, how long will it be before the median income is $100K for flipping burgers at McDonald's?


Fool me once, shame on you. Fool me twice and it is a duck hunting trip with Cheney.

Hmmmm. Everything you by goes up 25% but income tax prepayment is no longer withdrawn from your paycheck. I'll take the VAT instead of the current system in a heartbeat.

Tax based on what and how much you consume. Therefore, if you consume less, you pay less tax. Now less frugal folks who feel they need a new wardrobe and car every year may not like that, but those of us who see through the MSM programmed superficial consumerism would do much better.

A National Sales Tax would put control back in the hands of the citizen.

Or imagine you make $10hr and you walk into work tomorrow and your boss tells you your pay is now 7.50hr.
Same difference.
I can see one bit of sense in this though. It states that it would hit the lower income earners hard, however it is fact that right at 50% of American wage earners pay no net income tax, very many of the lower 50% recieve federal returns well in excess of any deductions that may have been turned in making it a welfare system in itself, and for those such as myself that make enough to pay some I see it as the equivilant of the 6500.00 net I pay each year (approx) as being handed directly to my lower income neighbor (by not that much, maybe 20% lower income and a lot more kids) who then goes down to the same clinic and gets those kids treated under medicare while I pay my bill (which indirectly helps pay their bill) and then to the grocery store with my cash versus their food stamps, and so on and so on. Worse of all that 6500.00 or so I'll never see again is taken at gun point (Don't believe that...then don't pay up if you owe and watch the guys with guns show up) and then a sizeable portion of that is simply eaten up by running the buracracy called the IRS to begin with.
While I hate this VAT idea on the surface, I can support almost any idea at this point that gets everyone paying into the system if only enough to say they are. The system has got to have some kind of reform. After all you can't really tax the super rich, they raise the cost of goods and services to compensate and the middle class that pays for these goods and services without government assistance wind up paying the super riches taxes. A flat tax doesn't work, the lower and lower middle income simply don't make enough money to make that work, if the rate is too low there is not enough income to run the country, if it is too high it can't be afforded by the same and the same applies to the uber wealthy passing it back down to the masses.
Likewise with the VAT, it will be passed right to the bottom too, so working class folk like me can't win, but I guess at least there won't be an earned income credit so that the VAT winds up being profitable for the lowest income earners yeah?
Hell, I don't know the answer, but if this passes even at 10 or 15% without some other kind of real tax code reform then I guess I renounce my citizenship and start my own new country somewhere. I give up.

American people will bend over and take this. Just like we've taken the wall street bail outs, just like we've taken the wars in Iraq for 8 years. Just like we've taken the new cigarette and alcohol taxes, just like we've taken the lies from the oval office for decades.

See a pattern? We'll take the new tax and just complain about it, and threaten re-elections.

They know they can do it, so they probably will.

If 10% tax was good enough for the Almighty God, then ten percent should be good enough for the US Congress.

25% my achingarse!

reply to post by David9176


In all fairness david isnt this what in part libertarians, some conservatives and tea baggers have been advocating for a while? Limiting or eliminating taxes to the bare minimum, then increasing the cost of our products?

reply to post by Ambient Sound


Nice thinking on this..

It makes sense..

The way I see it, whats done is done, and we need to figure a way out and not keep being negative about the past.

There will be time for that later.. but you will never know the real story, same as 9/11 etc..

I dont know. Seems to me that our original founders realized that those who are paying for necessities should not be paying tax on those necessities, as its already hard enough for those struggling to get by, they shouldnt need to be hit again when they can hardly pay for things they need. These are the things that SHOULDNT be taxed.

Indeed, in the original income tax, income was defined as money made from investments, NOT money made from labor. One of the main freedoms people demanded in early America was ownership of labor, and this is one of the main tenets of freedom. Tax on labor restricts freedom, and the government should have no right to take from my labors before i even get my hands on them. For gods sake, they take before i get it, then they take when i spend what i do get, then they tax me annually on the house or car i bought with money they already taxed twice. This is not freedom, it is serfdom, and we rebelled from england for a fraction of the taxes we pay today. 40% of my money goes to taxes (income, ss, sales tax, vice tax, etc), many european countries pay similar, but at least they get benefits from it, free health, free education, and those two alone are massive.

I could live with a 25% VAT, if income tax, sales tax, gas tax, etc. were all eliminated, but you know that's not gonna happen. It will be a VAT on top of all the other taxes we already pay.

In Calif we already have a 10% tax on everything put that on top of a 25% VAT without taking away some of the existing taxes and the people will rebel

We already have a 24% tax on gas here in Calif.

The next thing the government will want is our pay checks so they can decide how much to give us to live on.

This is not the way to control government spending as the government can then use this vat for any stupid pork project they want and then when they run out just take more.

If they put this VAT in i will bet it get raised to 30% in 10 years as the politicians go nuts with all the money and over spend till its gone. and then want more.

[edit on 27-5-2009 by ANNED]

reply to post by Southern Guardian


This does nothing to curb the size of government. It encourages an even larger increase in the size of it that will never end. So if I supported this I would be supported huge bloated government.

It goes beyond just being a tax. I've never been an advocate of the fair tax or the flat tax..as i'm not sure how I feel about them. I think for myself SG. But you are correct that many of those groups support those tax systems...I do not....at least not of this size. It would be have to be a much smaller percentage...and all income taxes would have to be eliminated. Of course...for that to happen...government has to shrink.

If anyone is opposed to large government...they should be opposed to this proposal.

And let's say it did work....do you honestly think it will all end after that and our government who feels that they need to get their hands in everything will stop there? No way. To suddenly think those in power would suddenly stop yearning for it seems impossible to me as government has never stopped growing since the very creation of this country.

The easiest way to stop a government that continues to wage war is to keep it from taking money from it's citizens. Our government has gone far beyond it's boundaries and will now come to us to fix their mistakes.

This does nothing but support policies that have all but bring this country to it's knees.

And this still does nothing to take care of the trillions we are already in the hole...so prices will be even larger than this articles indicates due to inflation...yet our working wages will stay the same.

This isn't an answer...at least not to me.

reply to post by Southern Guardian


Also wanted to add:

There has to be some kind of tax...the federal government has to function...but it should be imposed with tariffs on imports and possibly a small tax across the board...although I'm iffy on that.

Nafta should be repealed and the american worker should be protected. They are not...especially with this law. Also the borders need to be protected to stop the flood of illegal immigrants to the country which is a heavy burden on all of us.

So many problems....mostly done by government policy, politicians, and lobbyists.

I'll just say I wouldn't mind trying a VAT in lieu of an income tax. Would we not be taxed for returns on investments at that point? Sounds not so bad if that's the case.