American’s for Tax Reform’s anti-VAT caucus has grown by two senators and nine congressmen in the last couple of weeks, as the Obama administration continues to float the VAT as a way to pay for his health care bill.
From ATR’s letter inviting lawmakers to be a part of the caucus:
"In Europe, a small VAT was first enacted in 1967. At that time, Europe and the United States both confiscated about $.27 out of every dollar of national income. Since the introduction of the VAT in Europe, its average tax take has gone from 27% to 41%, nearly a 50% increase in just four decades. There is currently a minimum VAT requirement of 15% to be a member of the European Union, and an average VAT rate of 20%. Meanwhile, the VAT-less United States still taxes at about the same level as it did in 1967.
The experience of Europe should teach us that the imposition of a VAT is too often the precursor to bigger government. It is simply too easy for politicians to raise a tax that is hidden from citizens.
A VAT is not like a national retail sales tax. A sales tax is a line-item on a cash register receipt, and is easily known by the consumer: a very effective check on raising the sales tax rate. A VAT, on the other hand, is embedded in the final cost of the goods sold, and is hidden to the consumer. The VAT is applied at every stage of consumption, from wholesale to retail. It is passed along until it literally becomes as much an inherent and cloaked component in the price as transportation or raw materials. As a result, countries that have adopted a VAT have been sorely tempted to raise the rate over time. I am proud to have FAIR Tax sponsor Congressman John Linder (R-GA) as a member of the Anti-VAT Caucus."
It should be noted that the current Congress is not discussing tax reform when they mention the VAT, they are talking about tax expansion. The reason they are discussing a VAT is to increase revenues, not efficiency; this is thanks to 20 years of irresponsible spending programs.
The VAT is meant to increase government revenue, and in a way that Americans won’t see or think about. Gratefully, these statesmen are standing against the VAT, increased taxes, and expanded government.
View the PDF of the roster here.
Lawmakers in the caucus:
US Senate (4)
US House (54)
Chmn: Wally Herger