Something dark and evil is brewing over the horizon in Washington. It comes from the bowels of European socialist model soon to be transplanted in the heart of America by our socialism loving Congress. It’s the VAT tax!
The VAT tax or Value Added Tax is a tax that is levied on goods or services during each stage of production e.g. a raw materials supplier charges VAT to the manufacturer. The manufacturer then charges VAT to the wholesaler and finally the wholesaler charges VAT to the retailer.
The insidiousness of the VAT is that you the consumer will not see or pay the tax directly. Instead, the VAT tax is charged to you indirectly in the form of higher prices.
Governments love this tax because it provides a mother load of cash by repeatedly taxing a single product. The example I gave above is simple, but think about how much money a government would make when VAT is applied to complex products like electronics or cars. You can just imagine how much higher the prices of those items will be.
While greedy government spenders love the VAT tax, manufactures do not. The VAT tax makes producing products very expensive. If you thought manufacturing jobs are fleeing the United States now, just wait until VAT gets here.
Already trial balloons for VAT are being floated around Washington. White House economic adviser Paul Volcker raised the issue the other day. In addition the CBO has been receiving questions from Congress about a VAT tax.
I find the whole VAT idea to be pure evil. First, during this time of economic hardship the last thing any of us needs are higher prices on our goods and services. This tax would not be necessary if Washington had listen to our objections over bailouts, stimulus and the take over of health care. Now that they have run up the tab against our wishes, they wish to impose higher prices on our lives to pay for it. Outrageous!
No doubt the Democrats will try to sell the VAT as a necessity to pay down the debt and they will try to sell us a bogus story that consumers will not have to pay it. They may even try to say it will only be temporary. All of these talking points will be flat out lies.
Gird your loins folks, VAT is coming.
Via: The New York PostVia: The Weekly Standard