A value-added tax would be easy to enforce with an easy paper trail to follow. b
The downside is that it would hit lower income families harder when it comes
to basic necessities.
A Fair Tax Act tax on consumption would make taxation very easy and hand out
the administration of it to each state. b A tax rebate that is higher for lower
income families would mitigate the tax burden for these families. b Getting rid of
the IRS in this case could save millions of dollars but would actually make this
kind of taxation harder for families because they’ll have to go through more
agencies instead of a single IRS.
I read about VAT, or value added tax and can see the appeal. The idea of
placing a flat tax on purchases to increase revenue for the country is a great
idea. VATs are the third-largest source of revenue for other member countries
in the Organisation for Economic Co-operation and Development (Dore, Kate,
2021). However, the only way I could see it even possibly working would be to
lower income taxes. Especially now with the increase in pricing and so many
lower income families struggling. It would be hard to put VAT into place. Any
Presidential candidate to mention this in their election campaign would cause
lots of trouble for themselves. US Citizens are not going to want to increase the
amount of taxes they see come out of their purchases. In Virginia, we already
pay an average of 5.3% sales tax on purchases, an additional 5% in certain city
jurisdictions and a 1% tax on food and personal hygiene items Virginia Tax,
2023).
Dore, CFP, K. (2021, June 21). The value-added tax brings in billions for other
countries, but the U.S. doesn’t have one. CNBC. Retrieved April 2, 2023, from
https://www.cnbc.com/2021/06/21/this-tax-brings-in-billions-worldwide-why-
theres-no-vat-in-the-us.html
Retail Sales and Use Tax (April, 2023). Virginia Tax. Retrieved April 2, 2023, from
https://www.tax.virginia.gov/retail-sales-and-use-tax
References
Kurtzleben, D. (2013, January 25). Commentary: Why the U.S. Should Adopt a
Value-Added Tax [Review of Commentary: Why the U.S. Should Adopt a Value-
Added Tax]. US News.
