The Hill: “VAT unpopular,” 03/04/11

Knee-jerk opposition to the VAT is unfortunate. The recommendations of economists are dismissed on false assumptions by Congressmen who see VAT only as a political hot potato.

The economy could be structured for better success in world trade by replacing other taxes (corporate income and payroll) with a REVENUE-NEUTRAL VAT that would work to offset a competitive disadvantage to the U.S. The VAT is border-adjustable and subtracts the burden of governments from the price/value comparison of goods and services among countries.

Analytical discussion of the best way to collect revenues is irresponsibly sacrificed. For example, why not evaluate the impact of the sweeping tax reform recommended by Mitch Daniels – replace all taxes with a VAT and a flat income tax with a high deductible. Rather than examine the benefits and potential good for business, some Republicans expressed outrage and silenced the thought before it could possibly achieve traction. Unfortunate.