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Why doesn't the US adopt a VAT?


Beats me. The VAT (Value Added Tax) is a very fair thing. Some things in European countries are taxed at high rates (up to 17% in Spain) but they are not necessities. Other things, such as food and housing, have either low rates or no tax at all. And there are all kinds of rates in between.

In encourages thrift but does not punish anyone for buying the necessities.


If instituted properly. No one can agree on what that means, though. Mr. Popo has it best, by it's nature VAT burdens the poor with a higher overall rate than middle and upper class.


Thank you, Bolichi. Your explanation reinforces my understanding of the VAT.


The main objection to the VAT is that it would fall heavily on the poor,
who spend most of their income on basic items like food and housing.

Doctor Woot:



It has a consumer driven economy. An extra 25% on all goods and services wouldn't play very well in the states. They are more into hidden taxes there.....


The flat tax will make small firms and farmers pay the tax even if they have no profit
The flat tax is opposed by many small business groups
The flat taxes implicitly support big government by disguising even more of the overall tax burden as the current law
The flat tax has been kicking around for nearly 20 years
The flat tax makes everyone a taxpayer and collector, while the FairTax exempts 115 million filers [2000 figure] from ever having to deal with the IRS
The flat tax is regressive, but the FairTax would enable everyone to keep his full paycheck.
The flat tax has not only stalled, it has lost public and Congressional support.
The FairTax is instantly understood, while even some proponents of the flat tax don't understand it
There are no transition rules developed for the flat tax and they would be very difficult to craft
The flat tax taxes exports and relieves imports from tax
The flat tax confuses tax reform with temporary tax reduction and makes both twice as hard
The flat tax retains the entire income tax apparatus which erodes as quickly as you can say, "tax bill"
FairTaxers could advance these truthful points without resorting to bigotry associated with a cultic religious organization. However, for the most part, FairTax supporters have chosen not to attack the flat tax, but rather accentuate the commonalities between the plans - despite the above-noted differences. The reason is that, in the battle for tax reform, the real enemy is our current system.
Income tax advocates look down upon the articles of Bruce Bartlett with smug chortling, as Bruce is doing their work for them. The IRS and the liberals who want an income tax to ensure (1) taxes can be raised without the American people knowing it, and (2) wealth can be redistributed from the middle class to the poor, do not even need to fight us - we're killing ourselves!
Perhaps Mr. Bartlett


VAT has nothing to do with flat tax.


Because VATs hide taxation. Taxes should be in the sunshine. Out in the open so people know exactly how much taxes they are paying, and can make decisions at the voting booth accordingly.
Bureaucrats and politicians love VATs because they can hide taxes from voters in the cost of goods.


That makes sense. Thank you, Ed.

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