« Christianity to believe in (UPDATED) | Main | "How Can There Still Be A Problem? We Passed A Law!" »

Is the Value Added Tax coming?

Brit Hume thinks a value added tax or VAT may be around the corner. He suspects the Democrats might pass a value added tax after the November elections when Congress is in a lame duck session, assuming the Democrats lose one or both houses (If the Democrats lose control of both houses, trust me, the Democrats will pass far more than just a value added tax.). Here's Brit offering his analysis (via NewsBusters):

A VAT is kind of like a national sales tax, except it isn't applied when a consumer purchases an item. Instead, a VAT applies to an item every time value is added as it moves up the chain of production, which means the producer, the wholesaler, and the retailer each pay the tax on the amount of the value added. Liberals all think the VAT is wonderful because they say the consumer does not see the tax. Well, that is totally false. Any time a tax is imposed on a producer or service provider, it is passed on to the consumer. It appears to be invisible, but it really isn't.

If you're dealing with something inexpensive like socks, the price increase that comes as a result of the VAT doesn't have such a negative impact. If you're dealing with much larger, more expensive items, like automobiles, the tax will significantly increase the price of the car. There simply is no way around it. Try to think about all the individual parts that are required to manufacture a car. Let's start with the most visible parts: wheels, steel, plastics, paint, textiles, glass, gauges, pedals, and lights are only a few. There are significantly more parts that we don't see: switches, bolts, screws, wires, chains, belts, hoses, mufflers, pipes, catalytic converters, and it goes on and on.

Here, let me make it easier. Take a good long look at this image of this car with all its parts laid out:

You see all those individual pieces and parts? There are, what, maybe a few thousand of them altogether? You might want to grab a magnifying glass to see teeny-tiny ones. Each and every one of those parts that is made in America will be hit with a value added tax at every stage of its production, which I'm guessing is at least two stages - raw materials and then manufacturer. I'm assuming large automobile companies buy directly from the manufacturer, but maybe not, in which case, there would be three layers, possibly more, of value added taxes. And the taxes on every single one of those parts will be reflected in the final price of the car. Which means you can expect to pay a lot more for a new automobile. Suddenly, used cars look a bit more attractive, huh?

In Europe the VAT takes the place of a sales tax. If a VAT is imposed here in America it will be on top of the sales tax and since sales taxes are imposed by state and local governments and they won't let go of those revenue streams any time soon. Not only that, but since the VAT will be reflected in the retail price of the product, you'll pay sales taxes on the value added taxes. Isn't big government fun?

Update: Charles Krauthammer, one of the Right's most brilliant minds, wrote his latest column on the value added tax called The VAT Cometh. He writes of the significance the VAT plays in Obama's presidency:

Obama set out to be a consequential president, one on the order of Ronald Reagan. With the VAT, Obama's triumph will be complete. He will have succeeded in reversing Reaganism. Liberals have long complained that Reagan's strategy was to starve the (governmental) beast in order to shrink it: First, cut taxes; then, ultimately, you have to reduce government spending.

Obama's strategy is exactly the opposite: Expand the beast, and then feed it. Spend first -- which then forces taxation. Now that, with the institution of universal health care, we are becoming the full entitlement state, the beast will have to be fed.


Krauthammer is right. That is exactly the strategy and Obama and his government-loving leftists are absolutely determined to succeed no matter what the political consequences. ObamaCare is only the beginning of what they hope to accomplish and the VAT is key to providing the revenue stream.

Cross posted at KimPriestap


TrackBack

TrackBack URL for this entry:
/cgi-bin/mt-tb.cgi/38656.

Comments (38)

Well, if the conservatives ... (Below threshold)
GarandFan:

Well, if the conservatives sweep Congress this fall, those losing their jobs will have no compunction about restraint. Just gives the new Congress more work. And an even bigger excuse to CUT DEMOCRATS OUT OF GOVERNMENT ALTOGETHER. Obama signs "Immigration Reform" or "VAT Tax", he's signing his own political death warrant in 2012.

They seem to forget one thing, the public can vote them OUT. They can't legislate the people out.

And no family making under ... (Below threshold)

And no family making under $250,000 will have their taxes raised.

Talk about your George Herbert Walker Bush moment.

Installing wholly new taxes, fees and mandates isn't technically 'raising' taxes.

I thought we've been down this road before. Oh wait, same rules don't apply to presidents of different parties.

Here's the thing: The dollar bill in my wallet doesn't much give a damn what you call the vacuum that sucks it out. When it's gone to the government, it's gone.

I wonder what would happen ... (Below threshold)
bobdog:

I wonder what would happen if the White House started receiving a couple million copies of Principles of Economics?

Do you think he might take the point and actually read one of them?

He suspects the De... (Below threshold)
SpideyTerry:
He suspects the Democrats might pass a value added tax after the November elections when Congress is in a lame duck session, assuming the Democrats lose one or both houses (If the Democrats lose control of both houses, trust me, the Democrats will pass far more than just a value added tax.).

I don't doubt that the Democrats would be dumb enough to try, especially the ones that get voted out. However, such behavior would further enrage an already angry populace. Those Democrats that survive and/or face the 2012 election may not be so willing to push it if they've just seen a number of their comrades voted out. Then again, they are goddamn morons, so who knows?

If the feared scenario shou... (Below threshold)
Jim Addison:

If the feared scenario should come to pass, it would be up to the Republicans, particularly in the Senate, to stop it. In the past, they have eschewed using all the delaying and obstructing tools available under Senate rules, on the grounds it would merely delay the inevitable, aggravate personal tensions, and create more animus than necessary, and I have generally agreed.

In this circumstance, though, there would be a ticking clock to work against, a limited window to pass all this stuff. Use of every obstructive tactic might well run out the clock until the new Congress must be sworn in. If the losing Democrats are willing to sacrifice their Christmas at home to pass such odious and evil schemes, Republicans must be equally willing to use every single means at their disposal to stop it.

And they will be heroes for doing it - but worthless scoundrels if they do not.

Worthless scoundrels in Con... (Below threshold)
bobdog:

Worthless scoundrels in Congress?

But I repeat myself, Jim.

From the Chicago Tribune: T... (Below threshold)
Bob:

From the Chicago Tribune: The nonpartisan Congressional Budget Office offers a prognosis: "Under the president's budget, debt held by the public would grow from $7.5 trillion (53 percent of GDP) at the end of 2009 to $20.3 trillion (90 percent of GDP) at the end of 2020." Interest payments would quadruple.

Obama and his minions have no intention of controlling spending. The only way to prevent total collapse is to impose much higher taxes. Unless we change the thinking of both parties in Congress that spending can continue without limits, we will probably have a VAT and many more new taxes. Remember this is just part of spreading the wealth around that BHO told Joe the Plumber was good for everyone.

"There are no morals in pol... (Below threshold)
Speller:

"There are no morals in politics; there is only expedience.
A scoundrel may be of use to us just because he is a scoundrel."
~Vladimir Lenin

Worth is a point of view.
It's about values.
Even scoundrels can be of worth to socialists.
Until recently it seems, most Americans haven't cared much whether a Congressman was a scoundrel as long as they were "our scoundrel" and brought home the bacon.(ear marks)

Times change.
Obama really has brought "Hope and Change" to America.
It's just not the exact "hope and change" he thought he was bringing.

I know some of the denizens... (Below threshold)

I know some of the denizens here will object to my saying this, but every member of Congress has a home district, and in most cases their constituents know where they live (a point recently brought home (ahem) by a couple of demonstrations, if I'm not mistaken).

In all seriousness, it would be a mistake of utter stupidity for a newly fired member of Congress to poison his own nest by doing something like this. And it might not be a bad idea to gently point this out to enough at-risk Democrat members to keep them from trying some such BS.

"Obama really has brought "... (Below threshold)
MikeNC:

"Obama really has brought "Hope and Change" to America.
It's just not the exact "hope and change" he thought he was bringing."

Speller - I think it is EXACTLY what he thought he would bring. It is the average Obama voter (also known as "useful idiots") out there that isn't getting the hope and change they thought he was bringing. Obama and the democrats are the biggest threat to the republic that we have ever faced. Look for them to try to ram through cap and trade and amnesty before November. This is about a total socialist take over of this country while they have the votes.

Nobody is talking about a V... (Below threshold)
Adrian Browne:

Nobody is talking about a VAT.

Sadly, you've been suckered into, fearmongering again just like your Fairness Doctrine fearmongering, and your Death Panel fearmongering and on and on and on.


Everyone listen to Adrian. ... (Below threshold)
GarandFan:

Everyone listen to Adrian. Adrian KNOWS how the Democrats plan on PAYING for all their largess.

The floor is your's Adrian. 'Splain it to us.

The only explanation I can ... (Below threshold)
Adrian Browne:

The only explanation I can come up with is that you're addicted to fearmongering -- similar to the addiction to faux outrage.

THE DEMOCRAPS DO IT TOO!!!

Adrian Browne doesn't have ... (Below threshold)
Speller:

Adrian Browne doesn't have any explanation for how the Dems are going to pay for their agenda but knows for sure that our explanation can't be the right one.

Maybe you should shut up Adrian Browne until you've got something to say instead of just "nay".

Posted by Adria... (Below threshold)
Posted by Adrian Browne
Ooh, ooh, that smell! Can't you smell that smell? The smell of desperation surrounds you!
If a random idiot ... (Below threshold)
Adrian Browne:

If a random idiot like Adrian Browne can't predict something as vast and fluid as the Economy in a comment on wizbangblog there must be an economic apocalypse in our near future!!!


Turns out, last May, Obama ... (Below threshold)
Hank:

Turns out, last May, Obama and the dems floated this exact idea.

http://www.washingtonpost.com/wp-dyn/content/article/2009/05/26/AR2009052602909.html

Excerpt: "There is a growing awareness of the need for fundamental tax reform," Sen. Kent Conrad (D-N.D.) said in an interview. "I think a VAT and a high-end income tax have got to be on the table."

Adrian Browne, you've been ... (Below threshold)
Speller:

Adrian Browne, you've been supporting the spending by the Democrats all along.

If you gave no thought as to how the bill was going to be paid or didn't care how the bill is going to be paid then at least stop arguing with people who have given it some consideration.

You might also stop supporting more and more spending or we will have to conclude that you don't care how it's paid for because you are sure that you won't be paying for any of it because you don't pay taxes or are so wealthy that it doesn't make any difference to your lifestyle how much you are taxed.

EXPLAIN IT ADRIAN! <... (Below threshold)
GarandFan:

EXPLAIN IT ADRIAN!

HOW ARE YOUR OVERLORDS GOING TO PAY FOR ALL THEIR WONDERFUL PROGRAMS?

NO PLATITUDES. NO TALKING POINTS. OTHERWISE FUCK OFF!

THAT SIMPLE ENOUGH FOR YOUR SIMPLE MIND?

Establishing a VAT would be... (Below threshold)
moseby:

Establishing a VAT would be a totally partisan effort by the democrats. It would be a self inflicted suicidal wound, like plunging a knife into their own belly (seppuku). Acting as willing seconds (kaishakunin), the Republicans would in time chop their heads off by repealing the VAT along with obamacare.

"EXPLAIN IT ADRIAN!"... (Below threshold)
Adrion:

"EXPLAIN IT ADRIAN!"

I know in the goodness of Barry's unicorn laced heart he means only good for us..


If Barry says it, it must be so.

Is it just me, or is there ... (Below threshold)
Matt:

Is it just me, or is there no reason WHY the Democrats will pass a value added tax? A conservative pundit saying he thinks it will happen is not a reason.

"Nobody is talking about a ... (Below threshold)
Mathlady:

"Nobody is talking about a VAT. Sadly, you've been suckered into, fearmongering again just like your Fairness Doctrine fearmongering, and your Death Panel fearmongering and on and on and on."

Uh, yeah.....just like when no one was talking about reconciliation, right?

is there no rea... (Below threshold)
is there no reason WHY the Democrats will pass a value added tax?
Because their big-spending big-government programs have got us looking at multi-trillion-dollar deficits as far as the eye can see?
Matt, look at the deficit p... (Below threshold)
GarandFan:

Matt, look at the deficit projections for the next 10 years. LISTEN to the current talk of 'lowered expectations' for economic (employment) recovery. Having a sustained 10% unemployment rate is not good (unless you're a brainwashed European). Current tax revenues are FLAT. State tax revenues are FLAT. Where is the money going to come from to PAY? You are aware, at some time, we will HAVE TO PAY for all this government largess?

Don't forget Matt, European... (Below threshold)
GarandFan:

Don't forget Matt, Europeans are "smart and sophisticated". They have health care for everyone. Now we have 'health care for everyone'. The Euro's have at VAT's for years. So it naturally follows, Democrats ever admiring of the 'smart and sophisticated Europeans' will also want to latch onto that gravy train. Hell, their VAT is ONLY 20%. I'm sure the Democrats will start out "VAT Light". Maybe 2-3%. After all, whats 2 or 3 cents on the dollar TO FEED THE STARVING, CARE FOR THE HOMELESS, PROTECT THE POOR, PROVIDE HEALTH CARE FOR ALL. Then, when 2-3% isn't enough because tax revenues are falling, they'll just raise the VAT again. That will bring in MORE money! Just look at California. Just raised the sale tax. AND REVENUES FELL!

But that's only because people are STUPID and IRRESPONSIBLE! Who ever thought that when prices go up, people would curtail purchases?

"Because their big-spend... (Below threshold)
914:

"Because their big-spending big-government programs have"

Let me improvise an modification if you will Darth One!

Because thier Big-Eared-government programs have not fulfilled the Ones proxy that all men are inferior to his MF'n EGO!

The idea for the VAT system... (Below threshold)
M Malone:

The idea for the VAT system comes directly from Das Kapital, Marx's 1867 treatise on economics as he saw it. The economic world's understanding of value has moved on since 1867 and it's good to remember that just 3 years prior to that treatise the Chicago Board of Trade started to trade standardized forward contracts, the precurser to today's futures contracts and a change capital itself. Marx's writings on economics were out of date when they were published, 143 years ago.

Well, yeah, a VAT is coming... (Below threshold)
James H:

Well, yeah, a VAT is coming. I don't see any other way to pay down the massive national debt, not to mention a few decades of accumulated entitlements. I might lean to the left, but I'm not stupid.

The idea that the amassed d... (Below threshold)
M Malone:

The idea that the amassed debt can be repaid by saddling the nation's businesses with a morass of financial and bureaucatic burdens is well beyond stupid. It relies on backwards economic ideas that were out of date the day they were published, 143 years ago.

The idea that the ... (Below threshold)
James H:
The idea that the amassed debt can be repaid by saddling the nation's businesses with a morass of financial and bureaucatic burdens is well beyond stupid. It relies on backwards economic ideas that were out of date the day they were published, 143 years ago.

My point is that we're going to have to tax something. I know cutting spending is the other option, but I don't think Congress or the president has the testicular fortitude to make the spending cuts that would truly be needed to balance the budget in the short term or the long term.

I don't think C... (Below threshold)
I don't think Congress or the president has the testicular fortitude to make the spending cuts that would truly be needed to balance the budget in the short term or the long term.
You're definitely getting an upscore for that one, James H.
"My point is that we're goi... (Below threshold)
M Malone:

"My point is that we're going to have to tax something."

My point is simple - It Will Not Work.

Crazy Marxist Schemes simply do not work.

"but I don't think Congr... (Below threshold)
914:

"but I don't think Congress or the president has the testicular fortitude to make the spending cuts that would truly be needed to balance the budget"


I dont even think he has the balls for it either!

VAT would be an unmitigated... (Below threshold)
Tsar Nicholas II:

VAT would be an unmitigated disaster for the economy, which of course means that liberal Democrats are strongly in favor of it.

I'm officially a conservati... (Below threshold)
aaron:

I'm officially a conservative now.

A VAT would hurt everyone, ... (Below threshold)
Bill:

A VAT would hurt everyone, including unions and un/underemployed. So I can't see them trying it. In addition, anyone with half a brain knows as a fact that raising taxes will NOT raise revenue. People or businesses quit and/or move away, others go underground into a blackmarket.

Maybe I give them too much credit, but I doubt anyone is stupid enough to try to pass a VAT in this country.

Isn't it time to consider t... (Below threshold)
GrimshawsSanitarium:

Isn't it time to consider the ultimate opt out, i.e., State Secession or, more politely, Peaceful Disengagement? Jefferson, Madison and other Founders foresaw the inevitable rise of a tyrannical federal Behemoth arising from the Compact of the Several States of 1787 otherwise known as the Constitution of the United States of America. Now, the Monster is full upon us, its growth unstoppable, mowing down liberties and privacies like a weed-wacker in a field of daisies. Oops, there goes another one!

The "War Between the States" or "Civil War" (1861-1865) are misnomers. In truth it was a confrontation pitting 11 seceding southern states against what was construed as an obstreperous federal government (which happened to represent 23 non-seceding states).

The question now, of course, is what are Americans who value their natural freedoms, their rights to privacy and to be left alone, and their economic self-sufficiency going to do about an out of control federal government that arguably is coming at the citizens and the Several States from every quarter? It seems to me that the Several States, who created the government federal by Compact, have the right if not the obligation to defang what they created when it becomes destructive of the Compact's original purpose and intent.





Advertisements









rightads.gif

beltwaybloggers.gif

insiderslogo.jpg

mba_blue.gif

Follow Wizbang

Follow Wizbang on FacebookFollow Wizbang on TwitterSubscribe to Wizbang feedWizbang Mobile

Contact

Send e-mail tips to us:

[email protected]

Fresh Links

Credits

Section Editor: Maggie Whitton

Editors: Jay Tea, Lorie Byrd, Kim Priestap, DJ Drummond, Michael Laprarie, Baron Von Ottomatic, Shawn Mallow, Rick, Dan Karipides, Michael Avitablile, Charlie Quidnunc, Steve Schippert

Emeritus: Paul, Mary Katherine Ham, Jim Addison, Alexander K. McClure, Cassy Fiano, Bill Jempty, John Stansbury, Rob Port

In Memorium: HughS

All original content copyright © 2003-2010 by Wizbang®, LLC. All rights reserved. Wizbang® is a registered service mark.

Powered by Movable Type Pro 4.361

Hosting by ServInt

Ratings on this site are powered by the Ajax Ratings Pro plugin for Movable Type.

Search on this site is powered by the FastSearch plugin for Movable Type.

Blogrolls on this site are powered by the MT-Blogroll.

Temporary site design is based on Cutline and Cutline for MT. Graphics by Apothegm Designs.

Author Login



Terms Of Service

DCMA Compliance Notice

Privacy Policy