Cruz and Paul have a terrible idea: A value-added tax

They claim VAT would be a substitute for income tax, but we know politicians will never get rid of any tax.

http://www.marketwatch.com/story/cruz-and-paul-have-a-terrible-idea-a-value-added-tax-2016-01-14

 

the goal is to get the camel's nose under the tent. the income tax in the US started out at 2% with most of the population exempted. it peaked at 90%.
the democrats will love this proposal.

 

The idea of a consumption tax (a VAT is really consumption based anyway) has long been suggested and celebrated, but the concern has always been that it would be in addition to income tax, not instead of. So that's nothing new.

 

I positive attitude is essential to accomplish anything.

 

Banjo, it works in Europe very well. It's really the only way to tax the rich without the rifle. Otherwise we have to accept the fact that middle class and poor in this country will absorb 100% of the tax burden in this country. As long as the tax is equal across the board in terms of what is taxed and what is not, the market will find an equilibrium.

 

Income tax will never go away in this country. Here's the deal, I'm a libertarian, but we have bills to pay. And the bills will get paid one way or the another, that much is certain. A VAT tax in a society that values consumption as much as we do will work. Again, the IRS does take donations and anyone on ET on the right or left is free to make that check whenever you like. In the absence of those donations, taxes will be levied. Plan accordingly.

 

This isn't a new idea, but in the country like the U.S. it will be impossible to substitute income tax.

 

We already have consumption taxes in this country - we call them state sales taxes.

(props to Ricter for alluding to this over a year ago)

 

Please let Ricter know that in Europe, there are ALSO local sales taxes on TOP of VAT taxes. Also let him know I said hi.

 

I'm well aware Mav. When ET starts to get stale I post things that are econ, trading related to get people going on a new topic.To me ET is a great social science lab, it's like a giant focus group with a broad spectrum of participants wider than any focus study/experiment cud ever be. In that reguard it is indeed unique.