Posted on 04/13/2010 10:48:29 AM PDT by K-oneTexas
Now that President Obama and the Democrats have generated a projected record $10 trillion in new debt over the next 10 years, they are now singing their favorite song: We must raise taxes!
Sen. Dick Durbin, D-Ill., sent the first signal a few weeks ago when he said paying taxes is the price we pay for living in this great country. Never mind that we are paying too much and that too much of our money is being wasted.
One of the president's senior economic advisers, Paul Volcker, said recently in a speech that "we must raise taxes" to deal with the deficit. Never mind that the administration and the Democrats made an already bad deficit situation worse, and never mind that they were aware of the situation before they jammed the disastrous health-care bill through Congress for the president's signature.
It is outrageous that they have played the taxpayers for the sucker punch of the century. They ignored the coming deficits of Social Security, Medicare and Medicaid while passing the massive health-care bill. To make matters worse, Mr. Volcker is suggesting the dreaded value-added-tax, also called a VAT tax.
Please insert the scream of your choice right here if you already know the implications of a new VAT on this country. Otherwise, keep reading.
A VAT is not a single new tax. It is several new sneak-a-taxes. It taxes each phase in the development of a product or service until it is ultimately sold to the end user, and you also pay any applicable retail sales taxes. These intermediate taxes are passed along to the consumer and are reflected as a net increase in the price of the goods or service.
The doubly outrageous aspect of the VAT is that it is on top of all the other state and federal taxes we pay. Paul Volcker and the Democrats like the VAT because it is hidden from the clueless and uninformed voter, who will forget about it soon after it is passed if it is passed.
The VAT is also a cowardly tax increase because these same clueless and uninformed voters will easily blame the greedy retailers for raising the prices of their merchandise. And for the 50 percent of the taxpayers who have figured out how not to pay any taxes at all, this administration and Congress will find a way to give them a VAT exemption.
Just as Obamacare puts this country a giant step closer to becoming the United States of Europe, passage of a VAT would certainly seal the deal as the New Europe, which would be nearly impossible to undo. I said nearly impossible, not completely.
The answer to reducing the deficit and supercharging the economy is to replace the tax code with the single-rate Fair Tax. This solution assumes, however, that there is no continued increase in federal spending. With this administration and Democrat-controlled Congress, stopping the spending is completely impossible.
Obama and the Democrats in Congress would never consider the answer to reducing the debt and stimulating the economy I just proposed, because it does not achieve their goals of a government power grab, expanding the role of government in our lives or creating more social programs for the clueless and the uninformed so they will continue to elect and re-elect liberal Democrats to Congress and the White House.
Never mind what We the People want, but we will remember in November.
He is right. The tax is hidden in the price of the product, so that when they raise taxes you’ll blame the greedy corporation that sold it to you.
And it enters in at each of several levels of manufacture and handling so that a relatively small tax gets multiplied.
TELL IT LIKE IT IS HERMAN!!!!!
Cain 2012!
Freeze Federal spending to the rate of inflation for 3 years. The problem is not that we don't tax enough, the problem is we spend it far faster then we take it in.
If VAT means what I think the acronym stands for, then Craigslist and garage sales needn’t worry.
Well, except for the hand woven potholders. :)
A bigger problem is (without spending reform) the government can not tax enough to pay off the bills.
The bills and the debt is more than the economy actually produces. It is more than a 100% tax on our income. It is more than confiscating every home in America and any other investment.
at LEAST we MAY have some control over this tax
don’t buy. Period. Don’t buy unless you MUST and then remember you are paying congress and obama tribute for the privilege of owning whatever it is you are buying. Is it worth it?
If you are in consumer business, be prepared.
The VAT is highly regressive.
A VAT might be applied over and over again depending on the number of steps in a product production cycle (i.e., grain to flour, flour to bread, etc).
Also the VAT is hidden in the sales price, not broken out.
FairTax only taxes once at the retail level.
When I was stationed in Europe I saw it firsthand, and it made everything very expensive. I think it is one of the primary reasons that most natives of European countries had very few, if any, children. They simply could not afford them.
The Value Added Tax (VAT) is a tax on each step of the manufacturing process in which a business buys a product and adds value to it. As such the total cost is hidden in the final price that the final consumer pays.
They (Dem/Libs) look to Europe as a beacon in how well this VAT works. If we look closely Europe hasn’t seen virtually no increase in jobs for decades. Maybe a result of the VAT. Plus many/most of the European countries that have a VAT also have an Income Tax.
The VAT, like the Sales Tax, is a consumption Tax. The Income tax is a tax on wages. The US doesn’t need both at the Federal level.
As Milton Friedman wrote way back in 1980, “Because it would be collected by business enterprises, VAT would be concealed in the total price the consumer paid and hence not perceived as a direct tax burden. That is its advantage to legislators – and its major defect to the taxpayers.”
Milton Friedman also said: “The VAT is the most efficient way to raise revenue for the government and the most effective way to increase the size of government.”
We already pay hidden taxes on everything we buy. So-called “corporate taxes” are always and everywhere passed on to the consumer.
Thank you. Nailed it.
In the end consumers pay all of the taxes. Every tax, from income tax to corporate tax to every fee you can think of raises the cost of doing business and as such gets rolled into the price of the product you buy. There is no way to raise taxes that, in the end, the consumer doesn’t pay. The only thing you can do is disguise the tax so that the consumer doesn’t realize he’s paying it, and consequently blames someone else for prices going up.
You pay when you buy the product, and you pay when your family members can’t find a job and you wind up supporting them. You pay when your company doesn’t expand and they hold down wages because other costs of doing business are rising.
The VAT has been in effect in most of Europe for close to 4, if not 5 decades now.
It is a powerboosterhighoctanenitrous shot for the economy.
Look how the Euros have left the US in the dust over the past half century or so......
Amazing we are considering it, but otherwise FedZilla will go hungry.
Can you see the argument, a penny a dollar more etc etc....
but seeing how much of our manufactured goods come from overseas, how can they impose it on a Chinese sourcer, producer or shipper......
Perhaps they are envisaging VAT on services......
VAT is a hidden sales Tax and every one pays it at the same rate, mostly based on Income. lower income pays more, I say Hurrah, we are on the way to having a FAIR TAX. How is a VAT different?
barbra ann
Just another reason to move your factory to Asia. Skip the whole carbon law-VAT tax shakedown. If they shove through VAT and cap'n'trade, it might be time to go.
Dubai, Chennai, Shanghai.
Yes, but no one is talking about repealing income tax and replacing it with a VAT. They are just adding VAT on top of existing taxes.
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