V-A-T spells disaster

Do you feel undertaxed? The value-added tax can help with that

  • Follow Editorials

One idea, the Fair Tax, is a grass-roots idea that has been building steam for years. The other, a value-added tax, is a European import being talked up by liberal elites as the answer to all our government's problems.

Which idea do you think will get traction in the national media?

The VAT, of course. It's so continental!

Billionaires Bill Gates and Berkshire Hathaway Chief Executive Warren Buffett, and Buffett partner Charlie Munger, recently said the European-style value-added tax -- a tax on goods at every stage of their manufacture and distribution -- is pretty much inevitable in the United States.

Wow. Grass-roots Americans can work for years on something like the Fair Tax -- a national retail sales tax that would more fairly spread the tax burden and even reduce it -- but the elites have a better idea, and that's what we'll likely get.

And consider this bone-jarring endorsement of the value-added tax from Buffett: "In the end we are not taxing enough, unfortunately, or we're spending too much, probably some of each."

Do you feel undertaxed?

Buffett and friends believe the U.S. government needs more money for the country to be more competitive in the world. Oddly enough, this editorial page believes the American people need more of their own money for the country to be truly competitive.

And consider this telling, yet tepid endorsement of the value-added tax by Munger: "The people that are against it are against it because they think it will work too well, that the politicians will get too much money and do too many dumb things with it, and there is a good deal to be said for that point of view."

Wow. We'll just let that one digest.

Buffett adds: "We've got a gap of 10 percentage points between what we're raising in taxes and what we're spending. One way or another we are going to have to close that gap in a major way, so if some of those taxes fall on me, or some fall on Berkshire, that's probably the way it should be."

Just to clarify: The people pushing the value-added tax believe the federal government desperately needs more of your money. The people supporting the Fair Tax are more concerned with the people who are paying the taxes.

Which side do you fall on?

If you're on the fence, consider: The Fair Tax -- levied just once per product, at the point of purchase -- would replace all income taxes, payroll taxes, gift taxes and the death tax on family estates, and would ultimately abolish the Internal Revenue Service. The value-added tax does none of that -- and would actually be in addition to all those other taxes.

Still on the fence?

The VAT cannot logically be argued to be superior to the Fair Tax -- from a taxpayer's point of view, that is. Therein lies the rub: The value-added tax isn't intended to help people; it's intended to shore up big government, a la Europe.

Yet, because elitists -- many of whom have made their fortunes and now want to pull up the rope -- like the idea of a VAT, the proposal is apparently going to move to the fore.

If only we could have a series of national debates and news reports comparing the two approaches.

We're pretty sure the Fair Tax camp would welcome that. Will the VAT camp?

Comments (129) Add comment
ADVISORY: Users are solely responsible for opinions they post here and for following agreed-upon rules of civility. Posts and comments do not reflect the views of this site. Posts and comments are automatically checked for inappropriate language, but readers might find some comments offensive or inaccurate. If you believe a comment violates our rules, click the "Flag as offensive" link below the comment.
Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 09:56 am
0
0
Because kitten, I have what

Because kitten, I have what is called pride. I like to earn my own way. I know that may seem strange to some of you.

Kitten35
0
Points
Kitten35 05/07/10 - 09:56 am
0
0
Wow, that is unbelievable.

Wow, that is unbelievable. You simply can't imagine that not everyone has had the wonderful opportunities for education and a job that you have, do you? Why judge someone else's life so vehemently? Because you are so unhappy with your own?

Kitten35
0
Points
Kitten35 05/07/10 - 10:01 am
0
0
Wow. Tiger, I'm not tooting

Wow. Tiger, I'm not tooting my own horn here, but I want you to know that I work a job AND have my own business on the side (so I understand the self-employment gig too), and have a master's degree that I funded myself and pay my own bills. My husband is employed full time as well. I am not a slacker by any means. I work six or seven days a week, all day.

I work for what I have and am proud that I can. I am grateful for my education and my jobs. BUT I cannot believe that people think that they do not have an obligation to other people, including those less fortunate, that live in community with them.

Since you think all men are an island, again, why don't you go live on one? You can build a boat from your own bootstraps.

PS-Pride is not often considered a positive value.

ohhsweetconcord
3
Points
ohhsweetconcord 05/07/10 - 10:02 am
0
0
Trey - You could accomplish

Trey - You could accomplish the same thing with a huge VAT tax. The Fair tax is just a national sales taxes that replaces the income tax. Essentially, couldn't you levy a VAT tax that replaces the income tax? Its not really the tax mechanism that is even being debated. Its the amount that is levied.

So you're not really against the VAT, you're just against all forms of increased taxation? Then why the heck even argue against the VAT in the first place. The AC article is just dumb and is more political posturing. It doesn't even mean anything. Empty debate.

We're going to have to increase taxes or cut services or both. Probably both. And if we have to raise taxes then the most efficient way is through a Value Add Tax.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 10:05 am
0
0
I have had not one

I have had not one opportunity that is not there for every single American. And kitten, I never said you were lazy. I simply answered your question as to why I don't leach off others.

ohhsweetconcord
3
Points
ohhsweetconcord 05/07/10 - 10:06 am
0
0
Tigger, so are you saying

Tigger, so are you saying that Warren Buffet isn't productive as you? Or that maybe he hates himself because he is wealthy and that is why he wants to increase taxes ON HIMSELF. Or maybe...just maybe, he wants to increase taxes because he knows that America, as a country, needs more taxes to remain solvent. Then again, I'm sure Buffett was given so much in his life and you have never, ever been given any sort of privilege.

sjgraci
2
Points
sjgraci 05/07/10 - 10:07 am
0
0
TTT I can just about

TTT I can just about guarantee that I am wealthier and am compensated more than you. Wealth envy? Hardly. Why are you so envious of me?

The answer to my question is a very simple one, one that every American taxpayer should know. You either don't have a clue or are intentionally not answering because you know the truth. And, if that is the case, you are lying through omission.

The answer to my question is the answer to why a progressive tax is the fairest tax. So, what is the answer?

Kitten35
0
Points
Kitten35 05/07/10 - 10:16 am
0
0
"I have had not one

"I have had not one opportunity that is not there for every single American."

That is one of the most ignorant statements I have ever read.

Although this is the land of opportunity, not everyone gets equal access to quality education, which has been proven to have a direct impact on poverty levels. Sure...everyone has the opportunity to go to public school, but unfortunately, not all are public schools are equal. Many don't enforce attendance, allowing children who should be studying to be working instead.

Many of the "poor" do work hard but do not make a living wage or enough to support their families.

Many of those who receive "free handouts" are women struggling to get out of abusive relationships/marriages or single mothers whose deadbeat boyfriends left them in a lurch when they found out sex made babies.

Many of those who "don't work" worked at one time and struggle with problems such as drug or alcohol addiction.

Many of those live in projects with a low standard of living where drugs or prostitution are the only source of economic income. Many can not get out even if they try, due to gang laws or other nonsense.

I have never met anyone who is on the streets or in the projects because they want to be there. I have met many who are there because they don't know how else to get out.

I am sure to someone who has been so 'prideful', it is hard to understand that some people don't have the basic resources they need to take those steps, but it's a reality.

This is NOT "equal" opportunity. You need to open your eyes and see the broader picture.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 10:12 am
0
0
Sjgraci, on what are you

Sjgraci, on what are you basing your supposed knowledge of my income? A crystal bball? Amazing....if you need some facts, just make them up.

Kitten35
0
Points
Kitten35 05/07/10 - 10:15 am
0
0
TTT, you're the one making up

TTT, you're the one making up facts. Why don't you read some about the impact of education on things like poverty and job availability? Oh wait, right....that would shatter the little crystal ball that you're living in.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 10:16 am
0
0
Name an opportunity that I

Name an opportunity that I had, that isn't available to all....or, you can just say it's ignorant again.

sjgraci
2
Points
sjgraci 05/07/10 - 10:16 am
0
0
To make the question even

To make the question even easier, I changed it to a 50% tax bracket of income over $999,999. How much tax in this bracket will someone pay on an income of $1,000,000?

sjgraci
2
Points
sjgraci 05/07/10 - 10:22 am
0
0
Well TTT if you are in the

Well TTT if you are in the top 90% of wage earners in this country and have been for a couple of decades you may be wealthier than me. The point is I don't care where you are and the fact is there is a very good possibility that I make and have more than you based on statistics. If you are in the top 90%, great! I think you and I should be taxed even more.

Now, what's the answer to my simplified question?

Chillen
17
Points
Chillen 05/07/10 - 10:30 am
0
0
sjgraci. I have your answer.

sjgraci. I have your answer.

The tax would not be $500,000 because they would only pay 50% on the last $1. I don't have the time to work through the exact number but the amount paid would progress up - i.e. 10% first $15,000, 15% next $50,000 etc. (just fictional brackets).

We aren't dumb. That's why we vote for the conservative candidates.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 10:32 am
0
0
If you pay 50 percent on

If you pay 50 percent on $1000000 AGI, then you pay $500000. But I'm sure you probably didn't mean AGI. Nice attempt to look smart though.

Kitten35
0
Points
Kitten35 05/07/10 - 10:32 am
0
0
"Name an opportunity that I

"Name an opportunity that I had, that isn't available to all....or, you can just say it's ignorant again."

I believe I did that in the beginning of my first post. If you had processed the information, you wouldn't have to ask that question. Good try, though.

Rhetor
1042
Points
Rhetor 05/07/10 - 10:35 am
0
0
The so-called Fair Tax is not

The so-called Fair Tax is not fair at all because it shifts tax burdens to the lower income levels. (That's because the rich tend to spend in ways that are less likely to be taxable.) Any sales tax also tends to be quite volatile and makes it hard to budget (just ask South Carolina about that). VAT has worked in Europe and Canada, but I can't see it meshing with our economic system. A pox on both of these bad ideas.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 10:37 am
0
0
Kitten, you have no idea what

Kitten, you have no idea what opportunities I had. Again with the crystal ball.

sjgraci
2
Points
sjgraci 05/07/10 - 10:39 am
0
0
Chillen has the correct

Chillen has the correct answer of 50 cents. As I suspected, TTT does not have a clue.

Thanks for playing and TTT before you start advocating for an unfair tax system to the middle class and your continued bashing of the American progressive tax system, learn how it works. Hire an accountant. I have one and it is some of the best hard earned money I spend all year.

Kitten35
0
Points
Kitten35 05/07/10 - 10:47 am
0
0
"Kitten, you have no idea

"Kitten, you have no idea what opportunities I had. Again with the crystal ball."

And you, sir, have no idea what opportunites others may or may not have had. My point, exactly. Thank you for helping me make it.

Chillen
17
Points
Chillen 05/07/10 - 10:47 am
0
0
rhetor. I think the fair tax

rhetor. I think the fair tax is supposed to make it so that the rich cannot avoid paying taxes. There is nothing that would not be taxed so they can no longer take huge deductions and avoid taxes.

That's the beauty of it. Fairness for all. Everyone (especially those who spend a lot - i.e. the rich) would pay.

It also encourages saving - something our nation badly needs.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 10:51 am
0
0
And if you think you only pay

And if you think you only pay 50 cents tax when you make $1000000, that would explain the envy. How much was paid on the first $999999? Nothing?

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 10:55 am
0
0
Your welcome kitten. And

Your welcome kitten. And thank you for making the same knowledge_free statements that you accuse me of making.

KSL
140394
Points
KSL 05/07/10 - 11:00 am
0
0
Question for sjgraci. If you

Question for sjgraci. If you think you should be paying more taxes, aren't you free to give more of your money to the government? I bet your accountant works hard for you finding ways for you not to pay anymore taxes than you have to.

Kitten35
0
Points
Kitten35 05/07/10 - 11:01 am
0
0
TTT, I am not sure which

TTT,
I am not sure which "knowledge_free" comments you are referring to (By the way, grammatically, it should be "knowlege-free").

Mine are backed up by contemporary research, which, if you would pick up a book and read, you would discover.

sjgraci
2
Points
sjgraci 05/07/10 - 11:07 am
0
0
TTT has a problem with

TTT has a problem with reading comprehension and simple math problems. Go back and read the question. It was not a trick question. Anyone who understands a progressive tax system would immediately know the answer.

The question was not what the tax payer would pay in lower taxes, it was what they would pay on income in the 50% bracket.

Those that understand a progressive tax know what the answer is. Those that don't have a clue, like TTT, or those who want to exploit the clueless answer $500,000.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 11:08 am
0
0
I was referring to your

I was referring to your assumption that you knew what opportunities I have had
A statement you made based on zero knowledge.

KSL
140394
Points
KSL 05/07/10 - 11:09 am
0
0
Kitten, that was a typo. And

Kitten, that was a typo. And I believe you mean punctuation, not grammar.

Tigger_The_Tiger
0
Points
Tigger_The_Tiger 05/07/10 - 11:13 am
0
0
Ok Sjgraci. What would be the

Ok Sjgraci. What would be the TOTAL tax paid on $1,000,000? Or will you exploit the clueless answer of 50 cents.

KSL
140394
Points
KSL 05/07/10 - 11:17 am
0
0
Also kitten, your

Also kitten, your descriptions of people without opportunities include a lot of examples of people who have made bad decisions. Otherwise how do explain the people who are in those same conditions and work their way out of them?

Back to Top

Top headlines

Georgia Regents' hospital plan chosen

Georgia Regents Medical Center won a lengthy and hardfought battle over two other Augusta hospitals to build the first hospital in Columbia County, the Georgia Department of Community Health ...
Search Augusta jobs