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Acknowledging it would be a highly unpopular move, White House economic adviser Paul Volcker said yesterday the United States should consider imposing a "value added tax" similar to those charged in Europe to help get the deficit under control.
A VAT is a national sales tax that, like state and city sales taxes, would be collected by retailers.
Volcker, at the New-York Historical Society, told a panel on the global financial crisis that Congress might also have to consider new taxes on carbon and energy.
The VAT suggestion was immediately met with outrage by Republicans.
"It shouldn't surprise anyone that the Obama White House would advocate a European-style tax to help finance their European-style government health-care plan," said Brian Walsh, a spokesman for the National Republican Senatorial Campaign Committee. FOXNews.com - Obama Economic Adviser Says U.S. Should Consider 'Value Added Tax'
I told you so....Obama loves Europe...please Obama move there and leave the good old USA as it is!
More businesses will go out of business!!!
The netherlands has VAT 19% on clothes, cars, gas, etc...
On groceries, 6%, also 6% on shoe repair, hair cuts, books, etc...
It will be interesting to see the spin. They can't really say it's to pay for healthcare...because that's actually going to reduce the deficit. (Hard to type that with a straight face).
Can't be for the stimulus..because that's stimulating the economy.
It can't 100% replace income tax. Using the WSJ numbers below - at best a 10% VAT on spending (25% of GDP) would amount to only 2.5% of GDP.
In recent decades, the current tax code has yielded revenue on average of 18.5% or so of GDP, whether tax rates go up or down. The wealthy adjust their behavior or shield more income via loopholes, so income-tax increases never gain as much revenue as politicians claim. With spending as a share of GDP now at 25%, Democrats have to soak the middle class because that's where the real money is.
I heard, yes on Fox and Friends, that it was to cut it in half. income tax that is.
Well, yes and no. Here's the study which Volker was referring to, released last month. It contains several options, none of which have been agreed to. It's just a list of options for consideration.
While it does not suggest totally eliminating the income tax (I WAS wrong about that), some of the options considered would allow substantial reductions in the payroll taxes paid by both employers and employees. In fact, it would make a pretty substantial positive difference for Joe Worker. Also included are some options for changes in the way businesses are taxed which would have the effect of ending the tax policies which make off-shoring of our jobs attractive.
Overall though, the tax burden on most people would rise, except for the lower income groups. As an offset, the wealthy would be unable to shelter their income from the VAT and they would end up paying more.
Here's the study if you want to read it yourself and cut out the middle-man commentators, all of whom have an agenda to defend:
A VAT would be great! We need to raise taxes if we want to keep up with the rest of the World in terms of infrastructure and education. Maybe we could cut military spending a little while we are at it and actually build some things here at home instead of bombing other people's homes for a change.
A VAT would be great! We need to raise taxes if we want to keep up with the rest of the World in terms of infrastructure and education. Maybe we could cut military spending a little while we are at it and actually build some things here at home instead of bombing other people's homes for a change.
How about the government quit WASTING and STEALING so much of our tax dollars? It is insane to raise any taxes while so many are out of work and have or are losing their homes. So much for the left wingers caring for the poor!
So many countries are more of a threat than ever before and are building u their arms and the wacko left wingers think this is the time to make our country more defenseless. It is imperative we get rid of as many Demoncrats as possible!
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