- Essays on Lingua Lincoln -

- Closing the Loopholes -

by Lincoln Sayger

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You've probably heard an idea for replacing the inefficient income tax system with a national sales tax. The idea is that a national sales tax of 10 to 30 percent would provide the revenues needed by the government. And since you've probably heard of it, I will just highlight a few important points. I want to talk about some benefits that would likely go along with this system.

First, by switching to a national sales tax, we would eliminate many problems that go along with the income tax. There would be no loopholes for those with creative accountants to exploit in the treacherous waters of tax law. There would be no gotcha scenarios where you thought you were following the rules but suddenly ended up in deep trouble. There would be almost no tax dodgers, because almost the only people who would be able to skip out on collecting or paying sales taxes would be those taking part in illegal trade, and even then, they'd have to pay taxes to buy a candy bar. The list goes on, but you get the idea.

Also, while it may seem a big jump to go from something like 6% to something like 36%, remember that a person's income would no longer be taxed at the federal level. And because the sales tax is much easier to understand and administer, corporations won't need as many accountants and lawyers, lowering the cost of goods and services, which may erase the price difference caused by the increase in sales tax. And because you pay sales tax only when you buy something, you decide how much to buy that requires paying the tax. You could save your money, investing it to grow your balance and the economy without losing part of that gain when you took it out to buy things.

As you can see, having a national sales tax would be beneficial to many people and spread the tax burden more fairly.

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