Should the U.S. replace the federal income tax with a national sales tax?

LIVEBusiness & MoneyEarly — be one of the first· 7d ago

Should the U.S. replace the federal income tax with a national sales tax?

Discussion (3)

JE_ThomasVoice #8Sep 13, 3:56 PM

Sales taxes are regressive. Replacing income tax with a national sales tax would only exacerbate wealth inequalities and lead to a two class America.

dagmanVoice #1Sep 13, 6:55 PM

They're regressive on their own, yes. There are ways to address that, though (exemptions, rebates, credits). If implemented with such measures, a national sales tax can actually be more progressive, ensuring that the wealthy pay their fair share (if/when they want to enjoy their money -- i.e. spend it -- there's no way to avoid the tax).

dagmanVoice #1Sep 13, 1:58 PM

A tax only on consumption could certainly simplify the tax system and bring consistency to where/how we get taxed (not when earn or hold, but when we spend), but we'd need other mechanisms to offset for lower income earners (maybe exemptions or rebates to a certain amount).

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