Congress Considering A National Sales Tax
No, not the Fair Tax plan. They’re planning on keeping our existing income tax and just adding a national sales tax on top of it. Because the federal government is falling short on revenues. And, you know, they can’t just cut spending.
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.
You know what would avert fiscal calamity even better than big new taxes, something that will stifle economic activity and make us all less prosperous? If Obama and Congress would quit doing this to our national budget:
Falling tax revenues aren’t the problem. Run-away government spending is. We don’t need new taxes. We need less government.
Now I’m not against the idea of changing the federal government’s revenue model per se. If we were to replace the federal income tax with a national sales tax, per the Fair Tax plan, our tax code would be simpler. There would be hundreds of billions of dollars less in compliance costs. And a tax on consumption (sales tax) is a lot healthier tax than a tax on production (income tax). Which isn’t to say that the Fair Tax is without problems of its own.
But if we’re going to institute a national sales tax it should be to replace the income tax. Not add on to it. This nation simply cannot afford more taxes, and it especially can’t afford more spending.
