Would A National Sales Tax Be Used To Fund Obamacare?

Jillian Bandes | April 14, 2010 8:03 AM

Obama's widely-criticized debt commission is considering a Value Added Tax to tackle the mounting national debt. That's a code word for a national sales tax. But instead of axing other taxes to implement this new one, they just want to pile it on top of the others.

Here are wise words from Dan Mitchell's recent editorial:

Observers suspect that President Obama's deficit reduction commission will recommend the VAT to counter the administration's spending addiction; the only tool many economists believe is capable of raising enough money to make a dent in the gargantuan Obama deficit.

...Simply stated, there's no way to finance all this new spending without an added broad-based tax. But this is exactly why we should vigorously resist a VAT.

VAT has the potential to grow government above and beyond what we know today. Creating new taxes doesn't raise old ones, so its possible that it could seem like a better solution from a rhetorical standpoint. If this proposal moves forward, you can be sure the Tea Party movement will have a whole new issue to rally around...

Edited to add: When calling a VAT a new "income tax," I of course meant "sales tax."