A July 26 Ways and Means Committee hearing focused on consumption-based tax systems. Although there are a few different formulations for a consumption tax, the committee only addressed two - the "fair tax" (a national retail sales tax) and the value-added tax (for example, the "flat tax" which is also a consumption tax, was ignored).
There are lessons we can learn from the over 130 countries that use a VAT. I think there is also some benefit to states if they replace their out-dated, cumbersome sales tax regime with a VAT. Also, perhaps other countries can have lower corporate income tax rates because they have a national VAT.
I have a short article published today in the AICPA Corporate Taxation Insider on the VAT discussion at the July 26 hearing and the relevance to tax reform in the US - "VAT Lessons for U.S. Tax Reform."
And for a list of tax reform hearings in the 112th Congress - see this list here.
What do you think about a VAT for the US?
Subscribe to:
Post Comments (Atom)
1 comment:
CorpIncTaxes should be replaced by a VAT. Ideally, as Gov. Mitch Daniels proposed, the Payroll Tax, too. This would make the U.S. more competitive at home and abroad, as only the VAT is border-adjustable under GATT rules.
VAT is endorsed by President Clinton, Gov. Daniels, Warren Buffett, Bill Gates, Wilbur Ross, Jeff Immelt, Richard Trumka, Andy Stern, Ezekiel Emanuel, Alice Rivlin, Jeff Sachs, Fareed Zakaria, Bruce Bartlett, David Stockman, more. For information and resources on VAT, go to http://www.VATinfo.org
Post a Comment