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The value added tax will greatly increase the cost of goods, thus
affecting the poor much more than the wealthy. ************** That's why sales taxes are usually considered regressive. The poor are compelled to spend 100% of their income on basic needs. The wealthy spend as little as only a few percent on basic needs and merchandise subject to VAT or sales tax, with a higher percentage spent on services and travel and a very high percentage on investment. When you go to a poor person and say, "VAT is 20%, so give me 20% of what your earn" that can hurt a lot worse, (even though it's a lot less money), than approaching a wealthy person with "VAT is 20% and you spend 25% of your earnings on taxable items so hand over 5%". Flat tax, flat tax, flat tax, flat tax, flat tax. No tax on the first $30,000 or so per family per year, then a fixed rate of 15-20% on all earnings above that regardless of source. It's very fair, doesn't burden the poor with any tax at all, and takes a fixed, predictable, even percentage from everybody else without special favors or exemptions. |
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