Wednesday, September 08, 2004

National Sales Tax Mulled

After Bush mentioned a simplification of the tax code in his acceptance speech, a national sales tax is starting to get more attention and more support within congress. discusses this proposal.

Under Linder's plan, the national sales tax would be set at 23 percent, which he claims would be enough to replace the funds that the canceled payroll tax would have raised. The national sales tax would be in addition to the average 6.2 percent state sales tax that people already pay.

Linder said low-income Americans would benefit the most because they would receive a rebate or "prebate" for the new 23 percent sales tax. Linder's plan would abolish the IRS, creating in essence, he said, a $3 trillion to $5 trillion tax cut. The states would then be responsible for distributing these funds.

I've discussed this before in this post, Make April 15th just another day. We are overdue for an absolutely simple tax code saving billions of dollars in inefficiencies.