A National Sales Tax, or a 6.5% Consumption Tax, May Be Coming Down the Pike in the U.S.
Congress plans to slash social security 'entitlements' at a time when Wall Street has destroyed the home equity and private retirement accounts of potential retirees. Worse, they plan to increase the social security tax, disguised as a “mandatory savings tax.” This added tax would be automatically withdrawn from your paycheck and deposited to a “Guaranteed Retirement Account” managed by the Social Security Administration. Since the savings would be “mandatory,” you could not withdraw your money without stiff penalties; and rather than enjoying an earlier retirement paid out of your increased savings, a later retirement date was being called for. In the meantime, your “mandatory savings” would just be fattening the investment pool of the Wall Street bankers managing the funds. And that may be what really underlies the big push to educate the public to the dangers of the federal debt. - Ellen Brown, IMF-Style Austerity Comes to America, Web of Debt, March 2, 2010Coming Soon: A National Sales Tax?
A 6.5% consumption tax may be coming down the pike. It would be massive for something like that to come to the U.S. What you're doing here is you're creating an income tax and then you're putting a sales tax on top of that. And then if you start to raise the income tax again, then you're looking more like a European tax system.November 17, 2010
Fox News - A panel of Democrats, Republicans, economists and other experts is set to say Wednesday that a complete overhaul of the US tax code is the best way to address the nation's fiscal problems -- a new and likely controversial idea aimed at tackling the growing deficit.
The report, co-authored by Democratic budget veteran Alice Rivlin and former Sen. Pete Domenici (R-NM), follows a separate proposal last week by the two chairmen of President Barack Obama's deficit commission. The many similarities between the two offer a window into the types of proposals that might win backing as Washington launches into what is likely to be a protracted debate on deficit cutting.
The most recent report, put together by a group called the Bipartisan Policy Center, will call for a one-year payroll tax holiday in 2011 that it says will create between 2.5 million and seven million jobs.
The plan would lower income and corporate tax rates and offset them with a 6.5 percent national sales or "consumption" tax as well as an excise tax on sugar drinks like soda.
The Bipartisan Policy Center was created in 2007 by former Senate Majority Leaders Howard Baker, Tom Daschle, Bob Dole and George Mitchell with the aim of finding solutions to major national issues.
Rep. Brian Bilbray argues a new national sales tax would be a good idea if the income tax were phased out.
Last week's proposal, from Democrat Erskine Bowles and Republican former Sen. Alan Simpson, also called for an overhaul of tax and spending programs.
Other similarities include:
- Changing the formula for social-security taxes so that they are levied against 90 percent of all wages, compared with the current system, which caps the tax at a certain income level.
- Major cuts in discretionary spending. Both singled out a government policy that allows military retirees to collect full benefits after 20 years.
- Cuts to farm subsidies.
- Either eliminating or limiting certain politically popular tax breaks, such as the mortgage-interest tax deduction.
Treasury Secretary Timothy Geithner said Tuesday at The Wall Street Journal's CEO Council in Washington that the administration was waiting to see what the specific proposals looked like before it weighs in on specifics. He said the ideal situation would combine short-term fiscal policies that help sustain growth with medium and long-term policies that cut the debt.
“Here is a proposal that will save Social Security and the Federal government close to $50 billion per year. This is more than enough to pay for universal health care. Most office space is very expensive yet white collar workers only use it 8 hours a day, 5 days a week. This amounts to only 30% efficiency which is completely unacceptable in today's economic and ecological environment. We can no longer afford to let all white-collar workers that still have jobs work banker's hours when we can work two shifts per day in government and private industry and cut our overhead costs in half. This simple paradigm shifts solves three problems: It jumpstarts economy and fights poverty, cuts pollution, reduces budget deficits.
ReplyDeleteIf this bold idea is pursued aggressively, it would prevent future oil spills and save jobs, the budget, the economy and the environment and cost nothing.
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I shared this plan with the Select Committee for Energy Independence and Global Warming and Secretary Chu's office at the Dept. of Energy. It is out of the box thinking that is based on proven principles, low cost, and with no negative environmental impact. Aggressively implementing it would be much less costly that another oil spill. This initiative is even more relevant since Bernanke stated that we must get the Federal deficit under control and Obama is ordering all dept's to cut budgets 5%.