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PRESS RELEASE FROM AMERICANS FOR TAX REFORM
Contact: John Kartch ( jkartch@atr.org or 202-785-0266)

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11/1/05

Tax Reform Panel Rejects a VAT, Joining One Out of Four House Republicans
Anti-VAT Caucus Makes Its Voice Heard

WASHINGTON — The President’s Advisory Panel on Federal Tax Reform today released its plans to improve the tax system. In it, they explicitly-rejected using a value-added tax, or VAT. The fact that the VAT was considered and rejected should serve as a lesson for tax reformers.

ATR has organized an Anti-VAT caucus headed up by Congressman Wally Herger (R-CA). At 64 members of the House, the Anti-VAT Caucus is the largest it has been since the mid-1990’s. ATR’s anti-VAT caucus is a voluntary affiliation of members of Congress who believe that a VAT is bad tax policy. The ATR Anti-VAT Caucus seeks to protect citizens from the ease with which government is able to raise taxes under the radar through a value added tax. Prior chairs have included Tom Delay and Dick Armey.

“’VAT, or a VAT by any other name, is French for “big government,” said ATR President Grover Norquist. “Before the VAT plague descended upon Europe, it had a competitive tax burden relative to the United States.”

A value-added tax differs from a sales tax in that the value-added method places a tax on each stage of production. This allows the government to raise taxes without the full knowledge of the consumer. Since the mid-1960’s, Europe has seen a tax increase of almost 50% due to the value-added tax, while the tax levels in the United States have remained nearly constant.

“ATR is pleased to see the resurgence of the anti-VAT caucus, and is thrilled to see that the Tax Reform Commission wisely rejected a VAT,” continued Norquist. “Being saddled with a jobs and growth-killing VAT is too high a price to pay for tax reform or any other worthy reform initiative."

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Americans for Tax Reform is a non-partisan coalition of taxpayers and taxpayer groups who oppose any and all federal and state tax increases.  For more information, or to arrange an interview with Mr. Norquist please contact John Kartch at (202)785-0266 or by email at jkartch@atr.org.