# Does America need a federal Value Added Tax? **URL:** \ **Category:** Great Debates\ **Created:** [June 5, 2010, 12:58am UTC](https://boards.straightdope.com/t/does-america-need-a-federal-value-added-tax/542006 "2010-06-05T00:58:13Z")\ **Posts on this page:** 5\ **Page:** 4
**Author:** ![septimus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/septimus/32/410_2.png) [@septimus](https://boards.straightdope.com/u/septimus)\ **Post date:** [June 10, 2010, 4:32am UTC](https://boards.straightdope.com/t/does-america-need-a-federal-value-added-tax/542006/61 "2010-06-10T04:32:17Z")
> [@Chronos](#): > > If the end consumer ultimately pays all the VAT, and everyone along the way also paid a part of the VAT, how is the same thing not taxed multiple times? I thought he just explained it. Consumer buys a $100 item with 12% VAT and pays $12 extra. _But that $12 isn’t all sent to government!_ If the store paid $75 plus VAT, and has the receipt, then $3 is sent to government and the store keeps $9 to reimburse for VAT already paid. I know very little about taxation policies but _value added_ tax certainly does seem much more logical than _sales_ tax, where a 5% tax grows to 100% after 20 meaningless transfers. What _I’d_ like to see are tax rates that vary by consumption _value_. Junk food and caviar would be taxed heavily compared with “good” food. Luxury cars taxed heavily, etc. (Yes, I know I’m now about to be labeled a Marxist anti-American crypto-terrorist who probably doesn’t even have a birth certificate. :dubious: ) ---
**Author:** ![MrDibble](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mrdibble/32/114_2.png) [@MrDibble](https://boards.straightdope.com/u/MrDibble)\ **Post date:** [June 10, 2010, 12:46pm UTC](https://boards.straightdope.com/t/does-america-need-a-federal-value-added-tax/542006/62 "2010-06-10T12:46:22Z")
> [@Snnipe\_70E](#): > > The non profits already have leases in other buildings. At cost? > [@](#): > > Rents now days just cover the loans if they are lucky. So…they don’t actually own the building, the bank does. ---
**Author:** ![Musicat](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/musicat/32/20189_2.png) [@Musicat](https://boards.straightdope.com/u/Musicat)\ **Post date:** [June 10, 2010, 10:09pm UTC](https://boards.straightdope.com/t/does-america-need-a-federal-value-added-tax/542006/63 "2010-06-10T22:09:22Z")
> [@septimus](#): > > I know very little about taxation policies but _value added_ tax certainly does seem much more logical than _sales_ tax, where a 5% tax grows to 100% after 20 meaningless transfers. If you are talking about the increase in value from manufacturer thru wholesaler to retailer, that’s not how most sales taxes work, AFAIK. The sales tax is on the final sale to the last user only. Others in the supply chain are exempt as long as they can show they are merely passing the product along, not using it in their business. ---
**Author:** ![Snnipe\_70E](https://avatars.discourse-cdn.com/v4/letter/s/b5a626/32.png) [@Snnipe\_70E](https://boards.straightdope.com/u/Snnipe_70E)\ **Post date:** [June 11, 2010, 5:24am UTC](https://boards.straightdope.com/t/does-america-need-a-federal-value-added-tax/542006/64 "2010-06-11T05:24:52Z")
> [@MrDibble](#): > > At cost?So…they don’t actually own the building, the bank does. Hello. ---
**Author:** ![foolsguinea](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/foolsguinea/32/14751_2.png) [@foolsguinea](https://boards.straightdope.com/u/foolsguinea)\ **Post date:** [June 29, 2010, 10:45pm UTC](https://boards.straightdope.com/t/does-america-need-a-federal-value-added-tax/542006/65 "2010-06-29T22:45:19Z")
So you want to tax materials more (I guess “at all” may be more in a few cases) & labor less? …Actually, that’s rational. I’ll go for it as a replacement for the payroll tax. Not for income tax, though. That needs to be returned to the classic theory, with income taxes only on high earners & highly progressive, rising to confiscatory. [Previous page](https://boards.straightdope.com/t/does-america-need-a-federal-value-added-tax/542006.md?page=3)