Aaron, Henry J. and Isabel V. Sawhill, “Bend the Revenue Curve: Health Reform Alone Won’t End Deficit,” The Washington Post, 10/13/10

“The dirty secret, known to responsible fiscal experts of both parties, is that the revenue generated under current tax laws cannot pay for the government services—health care and everything else—that Americans want for their children, their parents and themselves.

So here is what we propose: Congress should enact a value-added tax, the equivalent of a broad-based sales tax on all goods and services. It should take effect only after unemployment has fallen to a predetermined level or in, say, five years, whichever comes first.  Congress should enact a value-added tax, the equivalent of a broad-based sales tax on all goods and services. It should take effect only after unemployment has fallen to a predetermined level or in, say, five years, whichever comes first. Congress should link revenue from the new tax and other sources directly to public health care spending through a newly created health care trust fund. The trust fund would pay for all federal health care spending. This framework would mean that Americans would get the health care they are willing to pay for. If spending outpaces projections, Congress will have to choose between raising taxes and finding ways to slow the growth of spending.

By balancing revenue and health care spending, such a reform would help solve America’s long-term fiscal problems. In the near term, it would also support and sustain the economic recovery. Consumers would be encouraged to buy now, before the tax takes effect.

http://www.brookings.edu/opinions/2009/1013_revenue_aaron_sawhill.aspx