VAT tax being discussed

[barbaro]

With massive federal deficits and many state shortfalls, the politicians in Washington are actually discussing.....the VAT tax. A federal tax on a goods and services.

The government is in an endless quest for money. Run deficits, raise taxes, and now.

contemplating a VAT tax:

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

Levy Viewed as Way to Reduce Deficits, Fund Health Reform


Demonstrators called for a suspension of value-added tax on food in Manila last year. Such a tax is attracting real interest among U.S. policymakers. (By Romeo Gacad -- Agence France-presse Via Getty Images)


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By Lori Montgomery
Washington Post Staff Writer
Wednesday, May 27, 2009

With budget deficits soaring and President Obama pushing a trillion-dollar-plus expansion of health coverage, some Washington policymakers are taking a fresh look at a money-making idea long considered politically taboo: a national sales tax

Common around the world, including in Europe, such a tax -- called a value-added tax, or VAT -- has not been seriously considered in the United States. But advocates say few other options can generate the kind of money the nation will need to avert fiscal calamity.

At a White House conference earlier this year on the government's budget problems, a roomful of tax experts pleaded with Treasury Secretary Timothy F. Geithner to consider a VAT. A recent flurry of books and papers on the subject is attracting genuine, if furtive, interest in Congress. And last month, after wrestling with the White House over the massive deficits projected under Obama's policies, the chairman of the Senate Budget Committee declared that a VAT should be part of the debate.
"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.

Link & Entire: washingtonpost.com - nation, world, technology and Washington area news and headlines

[Butterfly]

I think they will have no choice eventually,

[Jet Gorgon]

Heck, what's a VAT of 25%? As long as Obama advocates it, people will lap it up, no?

[barbaro]

Heck, what's a VAT of 25%? As long as Obama advocates it, people will lap it up, no?

Jet, where did you get the 25% figure?

[Jet Gorgon]

^ Heard it bandied about. Here's one quote about what would pay for Obama's ridiculous programmes:

...a paper published last month in the Virginia Tax Review, (Leonard Burman, co-director of the Tax Policy Center) 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.
What's that? A VAT? | Marketplace Scratch Pad | Marketplace from American Public Media

555 I don't reckon 5% would cover his spending, nor do I think everyman would have access to good healthcare, no matter what VAT rate he slapped on Americans.

[barbaro]

^ Thanks for the source. I just read the Washgington post article now (no need to cut and past but I'll throw in a link at the bottom) where Rahm Emmanual is throwing the idea of a 10% VAT tax.

Does it somehow affect income taxes?

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

More spending, more taxing.

[Jet Gorgon]

^ Also heard Emanuel's brother is involved... Does not affect income taxes at all -- it's a sales tax that feks everyone of every income bracket.

[TSR2]

Big tax hikes on the way in UK as WELL

But after election of course

Politicians economic with the truth? you betcha