[ancient_geezer]

How many people have a 40% marginal rate?

Most single proprietors, who pay full 15.3% payroll taxes plus high income taxes, and by IRS measures make up the bulk of non-compliance/evasion. Interesting the same most likely type of business to attempt to evade/avoid collecting the NRST from their customers.

You're also not including state sales taxes.

Hmm, we should add another 8% or so for states on the marginal rates for state income/payroll taxes as well which brings the max marginal rate up towards 50% on those small single proprietor businesses.

Point is, anyway you measure it the NRST offers no more incentive for evasion than the income/payroll tax today, and with 10% of the number of collection points, there are substantially higher risks of getting caught.

Here the total sales tax rate would be over 30% (over 40% with the required NRST rate).

If you want it use tax exclusive measures as it looks like you want to try to use, the marginal rates on income/payroll taxes comes out in excess of 200% taking both state & federal marginal rates into account.

Lets see, 40% sales tax, vs 200% income/payroll taxes. Not even a contest.

[ancient_geezer]

Sorry, 200% tax exclusive rate with respect to income/payroll taxes really should be 100%.

[Your Nightmare]

We don't have a state income tax.

I also don't think having 10% of the number of current collection points matters. First, you are assuming that the person making the collection (the seller) is doing the evading. There are a lot of ways for the buyer to evade also. And, even with a reduction in collection points, you are reducing federal tax enforcement by ~100% by eliminating the IRS. The states aren't going to do a very good job of enforcement for a quarter of a cent on the dollar.

We should expect at minimum a 5% evasion/avoidance with a NRST and I would say it would be closer to 10%. Of cource the AFT's 29.87% rate assumes 0% evasion/avoidance.

[Your Nightmare]

Most single proprietors, who pay full 15.3% payroll taxes plus high income taxes, and by IRS measures make up the bulk of non-compliance/evasion.

Why do you suppose single proprietors make up the bulk of non-compliance/evasion?