VAT

The VAT (Value Added Tax) in the U. K. just went from 17.5% to 20%. The VAT is basically a national sales tax. A bunch of companies and stores are saying they will absorb the January first jump for a bit to soften the blow. This is a consumer tax. Consumers have to eventually pay it. It doesn't matter how long you wait. Most people do not get an increase in income. Taxes go up and wages stay the same. When you talk inflation, you are loosing money just standing there. People just don't have the scratch to keep buying the same things they used to.

Some folks say we in the States should go to a VAT type tax in the U. S.. You know, I'm all for it as long with the exact same stroke of the pen, they abolish the IRS, at least where wage earning is concerned. The IRS might still have duties for corporations and such. The American public is not stupid. We know our government wants to squeeze us from both sides.

The higher taxes go the larger the black economy grows. That is, the more things that show up on the black market. People start working off the books, because VAT is on services as well. Smuggling goes up. People start turning a blind eye to kit that just sort of turns up. It is a bad deal. There is a point at which people will stop participating in the official market if they cannot compete with the unofficial one. They have to eat.

I still like my idea of a constitutional amendment that says no one is responsible for paying more than 50% of all of their yearly income in taxes regardless of who gets the money or where it goes. So, if stat tax is 12% on income and , local tax is 5% on income, federal tax is 40% on income and all sales taxes come out to say 5% of a person's income (that is 62% of total income), then they would not end up paying more than 50% of their total income on all of it. There would have to be a priority of course. The paperwork would be a nightmare. It might be worth it.