Posts Tagged ‘Heavy Traffic’
» posted on Thursday, October 8th, 2009 at 10:00 am by Jeremy Herrera
News Story: Nancy Pelosi Proposes a VAT – WSJ.com:
Pelosi is telling you want they plan to do to you… Sure Obama said that the $250,000 and below would not be taxed to pay for his health care plan… What do you think the VAT is going to do?
Well I had to explain this Value Added Tax (VAT) to a couple people and what it will do.
What is a VAT? – Well in a nutshell it taxes every step a product takes to be created. What that means is that if I was to make a computer and sell it to my customers there would be a tax placed on all components as they are created. Right now the items are only taxed when the customer purchases the end product. But if Pelosi gets her way each step will be taxed. So, for me to build this computer I will have to buy the case, motherboard, CPU, memory, and etc. In the VAT tax plan each part would be taxed multiple times. For example, the motherboard as multiple parts on it from various other companies. Each part of the motherboard would be taxed. then that motherboard would be taxed when the it is sold to me, then once I build the computer I would have to tax my customer. This in turn would increase the end price to the customer as each company would raise their prices to counter the added taxes.
So what will the VAT do for you and the nation?
- Increase of prices to cover the added tax.
- More companies moving there companies off shore to avoid the added taxes.
- More people losing jobs as the companies move off shore.
- Few people buying things because of the increase of cost.
- The middle class being taxed by proxy. Taxed through the VAT on every product they purchase.
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