VAT Stands For Very Angry Tax Payers

Just in case you have heard about a VAT tax…here are a few facts.  Around 150 countries currently have a VAT tax.  All of the below listed countries “started” out at a mere 2% or less just as they intend to start out our country.   They may even try the age old trick of calling it “temporary.” 

As these foreign governments “needed” more money, their tax was increased to the current levels.  America needs a “money machine” to pay for the deficit.  Our politicians will do just as these foreign countries have done.   

The VAT tax is added at each stage of manufacture or distribution.  It is actually a hidden sales tax.  This means the price of our goods will rise exponentially. A VAT tax will not replace the income tax but will be an additional tax.  The VAT comes under attack for being regressive. Because lower income people spend a higher portion of their earnings, it may hit them particularly hard.  Citizens in countries with a VAT tax find it nearly impossible to save money, buy a home, or increase their standard of living. 

The Steady Drip:
“Current European tax rates:

United Kingdom
Income Tax: 50%
VAT: 17.5% TOTAL: 67.5%

Income Tax: 40%
VAT: 19.6% TOTAL: 59.6%

Income Tax: 40%
VAT: 25% TOTAL: 65%

Income Tax: 45%
VAT: 16% TOTAL: 61%

Income Tax: 42%
VAT: 20% TOTAL: 62%

Income Tax: 55%
VAT: 25% TOTAL: 80%

Income Tax: 54.3%
VAT: 25% TOTAL: 79.3%

Income Tax: 52%
VAT: 19% TOTAL: 71%

Income Tax: 58%
VAT: 25% TOTAL: 83%

Income Tax: 53%
VAT: 22% TOTAL: 75%”

President’s Panel May Consider Value Added Tax-USA Today April 2010.   Doug Elmendorf, director of the Congressional Budget Office, spoke at the National Association for Business Economics economic policy conference in Arlington, Virginia, last month. Republicans argue that President Obama’s deficit commission is likely to consider a European-style value-added tax just got some fresh evidence.

Congressional Budget Office director Doug Elmendorf told reporters this morning that his agency is studying a VAT as part of its “strategic planning” for the future — one in which the $1.5 trillion budget deficit and $12.5 trillion debt must be addressed by policy makers.

“Many people in Congress are interested in it,” Elmendorf said, without specifying who.

Once Considered Unthinkable, U.S. Sales Tax Gets Fresh Look –
Wednesday, May 27, 2009

With budget deficits soaring and President Obama pushing a trillion-dollar-plus expansion of health coverage, some Washington policymakers are taking a fresh look at a money-making idea long considered politically taboo: a national sales tax.”

It’s On: CBO Fielding VAT Questions From Congress The Weekly Standard: “White House advisor Paul Volcker made news this week by calling a value-added tax (VAT) ‘not as toxic an idea’ as it’s been in the past for tackling the nation’s deficit problem. Today, Congressional Budget Office Director Douglas Elmendorf confirmed he’s been getting ‘a lot of questions’ about the VAT tax from Congress.

‘Many people in Congress are interested in it,’ he said of the VAT, a national sales tax that adds between 10 and 20 percent to purchases in European countries where it’s been implemented. ‘We’ve had conversations with a number of members and their staffs.’”

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