Wednesday, May 27, 2009

Into The VAT

The VAT (Value Added Tax) will be seriously considered by Congress and the Obama Administration sooner or later. Probably sooner.

Unfortunately, given the explosive growth in the Obama Administration's deficits – even before they run the tab up even further with nationalized medicine - don't expect any offsetting cuts in the income, capital gains, corporate, or excise taxes.

The only long term solution to the economic problem is to cut regulations and hidden business costs, increase profitability and investment, and reduce the size, scope, and cost of government. If, as Obama asserts, “ We're out of money”, huge new entitlement programs may not be the order of the day.