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Originally Posted by Paq
as for a national sales tax...bad idea...i cannot reasonably see any massive drops in prices to offset the huge increase in tax prices for goods or services...I dont' see prices going much higher, but there would be a short-term leap followed by long, sustained increases..
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A quote from an article I was reading (not online):
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Proponents of the VAT tax say that eliminating corporate income taxes -- which are currently passed on to the consumer -- will actually lower the prices for most goods and services. Using a 30 percent VAT to illustrate the point, CNN/Money senior writer Mark Gongloff explains, "[C]onsumers won't be paying $130 for a $100 DVD player. Instead, the cost of the DVD player could be cut to, say, $80. The 30 percent tax on that would take thefinal price to just $104." He says that negligible initial price increase, from $100 to $104, would be followed by price declines.
Stephen Slivinski of the Cato Institute says such price declines will inevitably result because "we will have more investment and business growth, which leads to lower prices, because more people will becoming to the marketplace with similar products."
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An article of Gongloff's on the VAT: http://money.cnn.com/2004/08/11/news.../election_tax/
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seretogis - sieg heil
perfect little dream the kind that hurts the most, forgot how it feels well almost
no one to blame always the same, open my eyes wake up in flames
Last edited by seretogis; 09-30-2004 at 01:02 PM..
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