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Before you all get TOO excited about this, let me remind you that to totally replace the income tax with a national sales tax would require a rate of around 20% or so, maybe more. Be aware that at those rates, the incentive to evade the tax through smuggling and black marketeering starts to become pretty significant, especially with high-value/low-bulk goods. The only reason why tobacco smuggling is not already a bigger problem in this country in spite of the high tax rates on it is because most tobacco products are relatively low-value/high-bulk.

If a national retail sales tax (NRST) goes into effect, I can confidently predict that very quickly a black market will develop for most high-value/low-bulk goods. What would be some examples? Here's a few I could think of: jewelry; watches; most electronic goods; software; rare coins & stamps; most smaller art works and antiques; some high-end silver, china, or crystal tableware; some high-end garments and accessories, especially if made of leather or fur; some musical instruments. It is interesting that many of the things on this list, except for the modern technology electronic goods, are the same ones that were subject to the old WWI-era "Luxury Tax."

Why be concerned about the likelihood of smuggling and black-marketeering. Well, do you like what is going on with the war on drugs -- the SWAT teams barging into homes day and night, sometimes mistakenly into the WRONG homes? Imagine this activity scaled up by a factor of ten or a hundred or so. Still sure this is what you want?

Why be concerned about the likelihood of smuggling and black-marketeering.

Technology provides a solution to this -- plus it'll serve to remove more DNC voters from society and put them behind bars where they belong.

"Still sure this is what you want?"

No matter what system is in place, there will always be 1) evasion, 2) a system of enforcement. In addition, the federal government cannot exist without some source of revenue. So we have to pick one, and RST is an improvement over the income tax.

I really do want the income tax to go in the worst way.
However, I am unsure about the national sales tax, too.

It will create an unbelievable bureaucracy that will have to support the management of this tax. Every business owner would still be the tax collector for the federal government and will at any time be at risk of having to deal with the extra scrutiny of a new version of the IRS.

If we are still going to go the way of a citizen's tax, I would much prefer a tax where every citizen is responsible for paying their share directly. It keeps the people connected to the real amount they are paying when they see it go directly from their pocket to the government instead of through a middle man.

I know it would never happen, but I think the perfect tax would be to tax imports. Tariffs were the means of federal government support once apon a time and with most of the hard goods sold in this country now being imported, maybe it could work again.

It would greatly increase the cost of these goods to the consumer, but it would be simple for the vast majority of the country and save a fortune in administration. The federal government would only have to deal with those who are bringing goods into the country - not every point of sale from sea to shining sea.

Another thing that worries me is that even if the income tax is not being withheld from checks anymore, SS and Medicare still will be, so we keep that whole system with its costs in place and we add a new avenue of taxation to it.

After people see an initial lowering of the amount taken from their check when the income tax is converted to a sales tax, I would assume we can expect them start slowly raising the amount withheld again for SS and medicare thereby getting away with more of our money without it being as noticable.

I'm open here, but we would have a lot to consider.

Bingo!

The balck market problem is why the pressure will be on from teh outset to trtansform teh sales tax into a VAT. A VAT minimizes lost revenue to the government.

A prediction: Within a twenty years of its adoption, the NRST will become a VAT. (Issues of VAT transparency may be addressed by requiring the accumulated VAT to be listed rather than built into the price.)

Say that the NRST is 20%. Even if it was that high, the price of goods would still be below what they are today. There is far more than 20% of the prices of goods that are being paid to cover others taxes.

Why be concerned about the likelihood of smuggling and black-marketeering.

This already occurs...to the tune of Billions of dollars in lost tax revenue. It's nothing new that people cheat on taxes.

The reasons people cheat:
the tax is unfair
the tax is too difficult to understand
the tax is easy to avoid with minor consequences.

THe nrst:
is perceived as fair
is easy to understand
is difficult to avoid and consequences are harsh.
To avoid the nrst, it requires collusion (two individuals acting together). To avoid the income tax, one need only overstate expenses or understate income- quite easy.

Further, the liklihood of being caught overstating expenses or understating income is very low, and the consequences are low - you pay up and pay a fine.

Under the nrst, if you're caught, you lose your business. How many business owners will risk thier livelihood to save a customer some money on taxes?

BTW you should know that 80% of all retail $ change hands in 20% of retail establishments.

That being said, cheaters will always cheat. But by eliminating the major reasons for cheating, the problem is minimized....which makes the nrst better than the income tax from a compliance standpoint.

imho

If a national retail sales tax (NRST) goes into effect, I can confidently predict that very quickly a black market will develop for most high-value/low-bulk goods. What would be some examples? Here's a few I could think of: jewelry; watches; most electronic goods; software; rare coins & stamps; most smaller art works and antiques; some high-end silver, china, or crystal tableware; some high-end garments and accessories, especially if made of leather or fur; some musical instruments. It is interesting that many of the things on this list, except for the modern technology electronic goods, are the same ones that were subject to the old WWI-era "Luxury Tax."

I think the coins and stamps are not new, so there would be no tax on them. Antiques are old, no tax on 'em.

A black-market already exsists, most people are just too lazy to find out where to purchase items from it.