Yes, the politician says 5%. But when you look at your receipt, your $100. purchase ($80. plus $20 NRST) is now $101. ($80. plus $21 NRST).
To the consumer, this looks like a 1% increase, not 5%. Very easy to "hide" a large tax increase.
(In a $13 trillion economy, that 5% increase just generated $650 billion in additional government revenue.)
It's even worse than that.
"Yes, the politician says 5%. But when you look at your receipt, your $100. purchase ($80. plus $20 NRST) is now $101. ($80. plus $21 NRST).
To the consumer, this looks like a 1% increase, not 5%. Very easy to "hide" a large tax increase.
(In a $13 trillion economy, that 5% increase just generated $650 billion in additional government revenue.)"
"It is a signal advantage of taxes on articles of consumption, that they contain in their own nature a security against excess. They prescribe their own limit; which cannot be exceeded without defeating the end proposed, that is, an extension of the revenue. When applied to this object, the saying is as just as it is witty, that, 'in political arithmetic, two and two do not always make four.' If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds. This forms a complete barrier against any material oppression of the citizens by taxes of this class, and is itself a natural limitation of the power of imposing them."
Alexander Hamilton in Federalist #21