How could that be, mathematically?
The Retailer sells his product for $100 and adds a 20% tax at the register and the government collects $20 on a $100 sale, just like a NRST. There is no difference to the customer. It's fully visible and there is no extra tax burden to any producer down the chain.(#9)
What about FICA? Does the VAT take care of that or is it collected separately and 15% more added to the VAT, making the comparable tax 35% instead of 20%?
The VAT is harder to evade. Less evasion mean you can generate the same revenue with a lower rate.Actually, the way I see it, the selling point of a VAT is that it can generate the same revenue as a sales tax with a lower rate. I don't see anything wrong with that picture. (#6)How could that be, mathematically?