Value-added taxes (VATs) have been attracting growing attention in the United States. GOP presidential hopeful Ted Cruz has proposed a VAT as part of a sweeping tax reform plan. The idea has also been backed by House Speaker Paul Ryan (R-WI), Senator Ben Cardin (D-MD), and others.

There are many benefits to such a tax. It could replace the revenue lost from reducing and simplifying the income tax, it could shore up the nation's long-term fiscal situation, and a well-designed VAT could be more efficient than today's messy income tax.