"...A sudden sharp decrease in consumer spending could be temporarily disastrous. Also, it would create a huge deficit at treasury. Of course, all of this can be dealt with by phase in or other means...."
I think you are correct, and this concern has lead me to question the prudence of doubling or tripling the "prebate" for some period of time, and gradually reducing it during a phase in period. I think this approach would allow the embedded costs to be wrung from the supply chain while allowing consumers the same, or perhaps greater ability to purchase for some time. It would involve a short term deficit, but I think it may be necessary to combat the initial sticker shock. ....just thinking outloud here.....
I had had pretty much the same thought. But I think that would also increase the rate significantly.