What's VAT?

Ugh.  So, just yesterday, in comments to the New York State Historical Society, Paul Volker -- White House economic advisor -- indicated that the idea of a value-added tax "was not as toxic of an idea" as it has been in the past and he also said a carbon and other energy-related tax may become necessary. 

As stated in the Washington Post, a VAT is a tax on the transfer of goods and services that ultimately is borne by the consumer.  Highly visible, it would increase the cost of just about everything, from a carton of eggs to a visit with a lawyer.  It is also hugely regressive, falling heavily on the poor.  But, VAT advocates say those negatives could be offset by using the proceeds to pay for healthcare for every American (read...return of "Single Payer" healthcare) -- a tangible benefit that would be highly valuable to low-income families.  (sounds like Washington politicians know what we want...or at least are willing to tell us what we want...whether we want/need it or not)

Leaving aside for a minute Barack Obama's empty pledge that if you earned less than $250,000 a year, "your taxes won't go up a dime"...a dollar figure our fact-challenged president subsequently lowered to $200,000.  You get the drift -- or, the drift as the case may be is the downward trend on the income-level that will be taxed.  Even the left-leaning post states that a VAT tax is regressive.

The floating of the VAT trial baloon -- which Volker likely did at the prodding of the White House -- fits in with other comments from Congressional Democrats about a VAT.  On May 27, 2009, the Chairman of the Senate Budget Committee, Kent Conrad, declared that a VAT should be part of any debate to close massive deficits projected under Obama's policies.  You can read the full article here.  And, in October of 2009, California's illustrious Speaker, Nancy Pelosi, spoke favorably of a VAT when she appeared on the Charlie Rose show.  Read good old Nancy's comments here.

Taken together, the Obama Administration and Congressional Democrats have one goal in mind...to institute European style socialism in America.  You see, a VAT is essentially a national sales tax.  Imagine this national levy added to already skyrocketing state and local taxes.  The VAT ranges as high as 25% in Europe.  Accompying the VAT is a corresponding growth in big government programs -- you get the picture.  When Obama pledged to be "transformational," what he was talking about was changing the way America has functioned for quite some time and replacing it with a failed European model.

The VAT, coupled with cap-and-tax, about which I've written earlier (it's the new socialism), would really make America the envy of the rest of the world...they'd be envious because our manufacturing, jobs and services would flow to China, India and other places less expensive than America at an even quicker rate...further eroding America as a world leader.

Oh, and to make matters even worse...the VAT may be in addition to an increased tax on high-income individuals AND added to, not instead of, our current income tax.  So, what is VAT?  VAT sound is Washington, DC shoving its hand deeper and deeper into our pockets to take our hard-earned cash to pay for a bloated, inefficient big government.