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EDITOR OF REDSTATE

VAT Talk Runs Against Desire of the Country

Our own Brian Darling has more on the VAT at Human Events.

What is a president to do when his gargantuan spending increases threaten to double the national debt and push the federal government into insolvency? A conservative would put together a commission to eliminate waste, fraud, abuse and unnecessary programs (all those things the federal government is doing but shouldn’t be). A liberal would raise taxes.Well, President Barack Obama may take a page out of the European social democracy playbook by employing a new Value Added Tax (VAT) as a means to balance the federal budget on the backs of American consumers.According to Dan Mitchell of the Cato Institute, a VAT is “a type of national sales tax, levied on the value-added at each stage of production. Consider a piece of furniture: The VAT would be imposed when the raw timber is sold, when the sawmill produces lumber, when the manufacturer builds a chair, a tax at the wholesaler level and then when a retailer sells the chair to a consumer.” J.D. Foster of The Heritage Foundation argues that liberals love this type of tax, “because it can raise vast new revenues without the taxpayers being really sure who took their money.” Instead of cutting spending, this administration is giving serious consideration to a sneaky new VAT.

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