Should the US adopt a VAT tax?

[Final-Fan]

Kasz216 said:

Final-Fan said:

Kasz216 said:

I would replace the corporate tax with a corporate vat. That way we tax all companies who do business here, rather then just the ones who are nice enough to locate here and create jobs here.

I hadn't thought of it that way.  At a glance, it does seem like handling corporate taxes by VAT is a good idea.  But for personal taxes, I think income taxes are fine -- except, of course, that the tax code needs simplifying, but that's a different topic.

[edit:  but wait, how would that even work?  A VAT is a sales tax.]

Similar to how it works in Michigan i'd think... but without the property and payroll restirctions.

http://www.michigan.gov/taxes/0,1607,7-238-43533-154440--,00.html

Granted Michigan isn't exactly tops when it comes to state economies, but I don't think it's related to the Single Buisness Tax.

As for Income taxes, not really against, them, but they don't really do what they mean to do either.  Not only would I simplfy them, i'd try and find a forumla to make them more equitable without moving into "Wealth tax" territory since wealth taxes tend to have negative effects.

I mean, the point of an income tax is supposed to be more "fair" drawing revenue wise based on what you earn, but a lot of people earn a lot, then almost nothing later on.  Like say your average NFL player who plays 3.5 years, makes a few hundred thousand dollars a year, then is out and working a lower paying job because he didn't finish college, or if he did probably majored in something useless/had a bad grade average.

Perhaps have higher "base" level taxations, but if your average lifetime salary is lower then the level your at now, you pay the lower level number.

Would theoretically help people who should have less money, build up more wealth.

The way income taxes are now, it's a half assed attempt at something.  If your going to do someting, you may as well do it right.

I see.  I wondered at the time if they just put a sales tax on stuff businesses did, but I wasn't sure that it could be pinned down that easily. 

Wouldn't your plan mean the football player is taxed even MORE for his (early) few years of glory? 

And, I mean, it's an interesting idea to try to average it out, but I am not sure it would work out so well.  For instance, isn't it true that people's incomes tend to go up as they get older (even inflation adjusted)?  So the average being lower than the current income would be fairly normal for many many people ... or at least it seems like that would be the case off the top of my head.  So it seems to me that would have a net effect of taxing people much more (than now) at the start of their careers versus at the end, because the taxes would shift away from the latter group, or else you'd lose a whole lot of tax revenue.  Or would that effect not be bad?  I'm just kind of presuming it would be bad, but maybe not. 

Also it would just be much more complicated.  I mean, every year's taxes would basically be calculated on your whole life history.  And wouldn't it also therefore be more vulnerable to fraud?