Quote:
Originally Posted by PB PM
Consumption taxes, if you look at other countries, are always used in addition to federal (Government) taxes. In Canada for example, most areas actually have two consumption tax layers, Provincial (PST/HST normally between 7-13%) and Federal (GST 5%). The problem, (yes problem), with consumption taxes is that they do not collect enough revenue, thus income tax is still required. Now, that said, Canada is a far more publicly supported systems (Health Care for one thing) than the US, so it might work.
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Saying that consumption taxes, by their nature, do not collect enough revenue seems "iffy" to me. Couldn't the tax rate simply be increased (or decreased, ha) to meet the needs of the state?
That's like saying income tax, categorically, does not collect enough revenue. It's the responsibility of those setting the rates to make sure that it does, no?