Saturday, April 24, 2010
VAT again
As various newscasters discuss the VAT, they always start by describing it as a "national sales tax". No, it's not the same thing ... well, in theory it's not the same.
And then they give an example of how the VAT works, such as the production of a cotton shirt. When the farmer sells the cotton to the mill, VAT takes a chunk. When the mill spins it into thread and sells the thread to a clothing mfr, VAT takes a chunk. When the clothing mfr sells to WalMart, VAT takes a chunk.
Trouble is, every example describes a PRODUCT NO LONGER MADE IN AMERICA. Cotton shirts are made equally in China and Turkey. Everything else is made solely in China.
So the misdefinition as a national sales tax turns out to be correct in practice, because the only economic activity that occurs in America is the final sale at WalMart.
Are these idiots actually unaware that America produces nothing? Or are they so completely steeped in transnational progressivism that they don't comprehend boundaries?
Whether they understand boundaries or not, you can be damn sure the IRS will understand. The IRS will know that it can't impose VAT on the steps of production in China, but it can impose VAT on stages of manufacturing in America in the unlikely event that any such activity should be attempted.
Oh boy! Just what we need! One more competitive disadvantage!
A pure national end-point sales tax would make tremendous sense for lots of other reasons, and it would NOT give us a new disadvantage. ¶ 6:25 AM
And then they give an example of how the VAT works, such as the production of a cotton shirt. When the farmer sells the cotton to the mill, VAT takes a chunk. When the mill spins it into thread and sells the thread to a clothing mfr, VAT takes a chunk. When the clothing mfr sells to WalMart, VAT takes a chunk.
Trouble is, every example describes a PRODUCT NO LONGER MADE IN AMERICA. Cotton shirts are made equally in China and Turkey. Everything else is made solely in China.
So the misdefinition as a national sales tax turns out to be correct in practice, because the only economic activity that occurs in America is the final sale at WalMart.
Are these idiots actually unaware that America produces nothing? Or are they so completely steeped in transnational progressivism that they don't comprehend boundaries?
Whether they understand boundaries or not, you can be damn sure the IRS will understand. The IRS will know that it can't impose VAT on the steps of production in China, but it can impose VAT on stages of manufacturing in America in the unlikely event that any such activity should be attempted.
Oh boy! Just what we need! One more competitive disadvantage!
A pure national end-point sales tax would make tremendous sense for lots of other reasons, and it would NOT give us a new disadvantage. ¶ 6:25 AM
