As lawmakers toy with the idea of an across-the-board sales tax on just about everything, tax reform advocates are starting to drum up opposition with the same fervor they employed during last month's anti-tax tea parties.
The idea of a national sales tax was once unlikely. But now that the federal government is doling out billions in stimulus spending and bailouts, and looking for billions more for health care reform, the prospect could be gaining some traction.
The frenzy over the idea kicked up after a Washington Post article Wednesday reported that Congress is starting to pay closer attention to this largely academic proposal and that the Obama administration, though shushing speculation, is soliciting advise from supporters of the idea.
"It should certainly raise alarm bells that they think they can inject it into the debate," said Phil Kerpen, policy director at Americans for Prosperity.
The value-added tax, or VAT, as it is called, amounts to a tax-on-everything -- or TOE, for the acronym-inclined. It's a tax on goods that's applied in pieces throughout the chain of production and distribution and results in an increase in the cost of virtually everything you buy.
Aside from raising revenue for the government, the move could have a number of things going for it, say proponents -- it's tough to evade, it's simple by comparison to the income tax and it encourages saving.
Some conservatives have called for something similar -- the so-called Fair Tax -- that would replace the federal income tax system with a national retail sales tax. - FOX News Story
This wouldn't necessarily be a bad idea if it were to replace the Income Tax System. However, the amount of money the Obama Administration is spending, I don't foresee them limiting any avenue to bring in money.
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