A National Sales Tax to replace the Income Tax

The Blind Hen has an interesting discussion about speculation of a proposal to eliminate the IRS and replace the income tax with a national sales tax. Excerpt:

I think the biggest attribute of the national sales tax is that it is collected at the point of sale. You buy a stapler and the tax is rolled in and you walk out the door with it. Bingo. You've just paid tax on the income you had to earn to buy the stapler. Sure, it jacks up the cost of the stapler, but by how much I can only speculate. Perhaps there is some equation to be calculated whereby the amount of money to run the national government is divided by the total of the GNP which will be subject to the tax. The resulting percentage will be the tax rate. How often will this be adjusted? Sadly, that will be up to the politicians.

/snip/

A national sales tax would make the burden of taxation visible instead of invisible. (This could be a good thing for those who want taxes cut, since the more aware the public is of how high taxes are, the more likely they will demand tax reduction. Hmmmm . . . do you think this is what the Republicans are really after?)

Interesting observations.

Comments

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I am a big fan of user taxes. If you don't want to fuel big government, then don't buy. If you want to reduce your taxes, spend less. If you want to get something tax free, then buy it used from a neighbor. What a great system!