December 03, 2010
The worst thing about a tax is when you don’t even realize you’re paying one. There are some members of the U.S. Government, including the current Speaker of the House who would like to start charging a hidden tax called a Value Added Tax, or a VAT. Several European countries already have it as well as others around the world. Some operate their entire tax system off of it, while others use it in addition to income taxes. The latter of those two is exactly what Nancy Pelosi would like to have here in America.
So how does it work? When you go to the grocery store and buy a gallon of milk for $3.50, and the clerk says “that will be $3.71,” you know that additional 21 cents is for the 6% sales tax. But with a VAT, that gallon of milk will be $5.50; you just won’t know you’re paying $2 in additional tax. That’s because the tax is added to every part of the production line, from the farmer, to the milk distributor, to the grocery store, and finally to you the consumer. Every time a good changes hands, whether it’s a part of an incomplete product, like a new car’s windshield, or that gallon of milk, a VAT is added. Driving up the cost of every single thing we consume.
What’s more disturbing is that this tax would be in addition to our current state and federal income taxes as well as our state sales tax. So in effect you would be paying taxes for a fourth time every time you purchase a good or service. This discourages consumers from consuming, the very thing we’re relying on to bring our country out of the recession.
It’s time for real tax reform in this country. Not a new tax in addition to all the others! Once the tax code is simplified, streamlined, and modernized we’ll have a more equitable and efficient system of taxation. America has always prided itself on being a leader, whether its democracy, technology, or academics. So why should we repeat a practice that has driven other nations to take more from their people, while continuing the spending binges that have left them in ruins? It’s time for America to lead once again. No VAT.