A sales tax could hit you quite hard if one year your washer, dryer and refrigerator needed to be replaced which for many people are fairly big items.
Actually this is not really true once the economy settled out after the change over.
The between business income taxes, payroll taxes and cost of tax compliance, tax litigations, the annual dance with every changing forms and reporting requirements, the the burden on citizen as reflected through higher prices, lower wages, and lower return on investements are horrendous.
The following article covers the mechanism on how the current tax system propagates and is embedded into consumption expenditure.
DO YOU PAY YOUR INCOME TAX
AT THE SUPERMARKET?
by D. Sherman Cox J.D. L.L.M. Taxation
The percentage used in the above article is somewhat off target in that it is based on a percentage that excludes individual income tax and SS/medicare contribution extracted out of individual wages & salaries. The 24% in the article considers only those factors actually paid to government out of impositions on the business plus cost to business of complying with the income, payroll, excise & tariff tax laws.
The total contribution of the federal tax system(including taxes in gross wage/salaries) to the price of retail consumption goods and services is 36% for taxes alone. Including cost of compliance at around $600billion/year, increases that percentage to about a 47% total burden on the family caused by the federal tax system as it exists today.
Tax as % of current family retail expenditure = fed/(1-state-fed-savings) =
23.5/(1-.235-0.102-0.012) = 36.09%
Current total Federal tax revenues are about $1900billion, more than $600billion(Paine '97, Pilla '95, AGCCA 2000, Williams 2000) additional dollars are passed on in consumption prices due to the business costs of complying with the federal tax law.
The percent total federal burden = 36*(1900+600)/1900 = 47.36% as passed through consumption prices.
Reduce the taxes on business and simplify them ultimately means a higher standard of living for the citizen as that would mean a considerable reduction in prices coupled with higher personal income available for consumption as well as savings and investment. By several measures the shelf price of goods and services should fall more the 20% though normal market forces. With a 23% NRST is tacked into lower pricing, coupled with full gross pay plus the FCA available, nearly all family's should see a substantial increase in standard of living and all that means to the economy.
Only those that for one reason or another elect not to accept the FCA, and do not now pay any taxes would fail to benefit in any substantial manner. Even those persons would be no worse of than they are today for their total expenditure (tax + goods & services) would remain approximately the same, if not a little lower than, it is today.
Little Willie was "The Worst President In American History".