"To the consumer, therefore, that 13% tax increase looks only like a 3% increase. Hey, not so bad, huh?"
You missed one very important point, which is that EVERYONE will have to pay the increase. Politicians can no longer play class warfare and divide and conquer. I expect that there will be substantial pressure to lower the rate.
I'm sure. Probably as much as the pressure against Clinton's "largest in the history of the U.S." 1993 tax increase.
Yep, those politicians hate all that extra revenue.
My point was that the tax increase will appear to be smaller to the average consumer. There will be less presssure to keep the rate down.
Given that 4:1 relationship, an "apparent 1%" tax increase actually raises about $480 billion.
Not bad, huh?