2016 Postmortem
In reply to the discussion: Hillary Clinton is now campaining against Single Payer health insurance [View all]DFW
(54,378 posts)Last edited Thu Jan 14, 2016, 01:03 PM - Edit history (1)
I live in Europe, where most countries have it. In Germany, where I am, we are one of Europe's lowest at 19%. Some countries are at 23%.
There is a constant fight as to what should be exempted and what should not, plus VAT always turns out to be government heroin. Once addicted, the junkie needs more and more and more just to function. It hits the poor and lower income families hardest (obviously), and costs a fortune to administer. England instituted it in 1973 as a requirement to join the EU. It was 10% then. It's 20% now.
Plus there is one detail American advocates tend to overlook: the States of the USA already have their own State sales tax (or, at least the authority to levy it, for the few that don't). This is not the same as a state income tax, which is levied once a year and can be offset against the federal income tax. No one could possibly accumulate the receipts of a year to find the state sales tax paid and offset it against a national tax. Asking all merchants to double their paperwork for this would risk a retail revolt, as the small business owners and sole proprietorships would be hit hardest.
The alternative to double taxation, of course, is to do away with state sales taxes. But then it's the Federal Government who decides how to distribute the income derived, and the states have no say beyond their representatives in Congress. If Vermont or Wyoming cries that they are being starved out, who will listen to a state that has only one Congressman? A portion of Germany's VAT must be turned over to Brussels to finance the EU bureaucracy. The social programs are largely financed by other taxes, of which there are a great many. The VAT has been examined every which from here to Sunday, and the USA has so far decided against it--a wise move, as far as I can tell.