23% Federal sales tax, eh? Looks like I'll have to lease my next car instead of buying it. So much for the "ownership society".

This could fly. Isn't 25% the number people are willing to send to the gov for taxes?

Mr. DeBenedetti:

That's the point-you'd decide your own tax rate.

The transition would be the tricky (and contentious for me personally) period. How would you exclude purchases using savings which have already been taxed (exorbinantly) under the old scheme?

James:

You would probably have at least 23% more to spend on the car, which makes it a wash.

The only economic revolution Bush is leading is a return to FDR-onomics. You can trust him on the war against terror but I sure as hell wouldn't trust him when it came to his economic platform. I have no idea why Democrats aren't supporting Bush, he's spent like no liberal since Roosevelt.

And now a national sales tax? Why do I smell an American future with a sales tax *and* income tax. Doubtless it will be a temporary measure.

Each generation does its own bit for the future--ouyrs may get the short end on social security and taxes.

Steve:

Budgeting is easy--structural change is the hard part.

Steve:

I agree, it wouldn't be hard to sell the concept of an income tax "for the rich" on top of a sales tax.

Most states already have both.

Given a few decades of creep, the income tax would probably be taxing half of Americans again.

The original income tax was just "for the rich"; now single people making minimum wage pay Federal income taxes.

I'm reluctant to comment, because I think this is fantasy, however to address Michael and Steve's concerns about the income tax, Bush would have to support a repeal of the 16th admendment in conjunction with the sales tax, otherwise it is a certainty that the income tax will arise again.

I'm pretty sure that without the 16th Amendment you can't have a national sales tax, either.

The legend of Al Ulman. Al was Chairman of the House Ways and Means committee in the early '80s. He floated the idea of a Value Added Tax (assuredly the form a "National Sales Tax" would take) and lost the next election. No congressman since has mouthed the words.

The 16th Amendment was enacted to overrule a very bad Supreme court case. Art I sec 9 said:

No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken.

The common understanding of that was that a captaition was a poll (or head or per capita) tax and that a direct tax was a land tax. As one Supreme Court Justice had put it early in the 19th century. "The Southerners did not want Congress to be able to tax their slaves or their land."

Congress had the power to impose excises and enacted some early in the 19th century such as a tax on carriages. Everyone was quite surprised to discover that an income tax was a direct tax not an excise, because the corpaorate tax had already been held to be a valid excise. the 16th amendment was enacted and approved in short order, but it is entirly likely that the supreme court would have backed down before that was necessary.

A sales tax or VAT does not require the 16th amendment because it is clearly an excise well within congress' art I sec 8 and sec 9 constitutional competence.

At least it brings in the underground economy.

Drug dealers finally paying their fair share.

I don't like the national sales tax plan. Lower income people already have a difficult time buying products. Won't a national sales tax plus the various states' sales taxes make it much more difficult for poor people to buy products? Since these people rarely pay any income tax, eliminating the income tax will not bring them more money so they won't have the extra income to pay the exorbitant sales tax.

Vince:

You'd exempt food and a few other necessities, but part of the theory is to get the poor to pay taxes as a discipline. In a society where less than half of us pay income taxes why would the majority care about how much we spend or are taxed? Also, by discouraging spending you encourage them to save.

The message is: make all your bigtime future purchases now. Other than that he would/could never get it done. A flat tax makes more sense to me. OK, put some progression into the rates to sweeten it for the "progressives."

genecis:

A flat tax misses the point though. The Neocomic revolution is all about boosting savings, which consumption taxes help with. Don't make the mistake of the President's critics and misunderestimate how coherent and radical his plans for the nation are:

http://slate.msn.com/id/2100251/

What Steve said.