It is inauspicious that both Bill Archer and Dick Lugar have refused to insist that the 16th Amendment, which allows the federal income tax, be repealed before any national sales tax or VAT is introduced.
There's a little dissembling going on when Grover Norquist consistently uses the VAT and a federal retail sales tax interchangeably.
Of course, you could argue (and Norquist does) that a retail sales tax will inevitably become a VAT.
Most countries have chosen the credit-invoice method VAT.
The VAT is an economically neutral tax and therefore will improve economic efficiency.
A VAT would improve our competitive performance in a global economy.
As a result of this multiplicity of rates, in practice VATs are probably even more discriminatory among different industries than the corporate income tax.
13] However, the standard rate for European VATs ranges from 12 percent to 25 percent.
Even in Canada, where there is a considerable tradition of indirect taxes, it has been necessary to vary the traditional VAT pattern somewhat.
In the United States, where tax history has been different and political biases run strongly against anything that even appears to be a tax on consumers, we probably cannot follow the traditional VAT pattern at all.
In addition to the VAT, Senator Hollings also proposed a freeze on spending at the fiscal year 1989 level, except for Social Security and federal retirement cost-of-living adjustments.
Although conceding the VAT was a definite positive option, the report also stated that there would be problems in adopting such a tax, including likely opposition at the state government level and the need for "an elaborate and detailed" new tax administration system.