re: MAGA’s Tariff idea…been wanting a “consumption tax” FOREVER

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And what if they're not electronic payments?

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Well let’s say you pay your grass cutter in cash.

He takes the cash and then what does he do with it?

Does he take the cash home and look at it?


No, he eventually has to bug something with it.


This, ultimately the “consumption” tax catches up.


Can’t hide the money forever unless you and your family like to eat paper money.

I’m curious how foreign holders of our debt would react to this. If we tax the hell out of their exports to where we decease how much we buy from them, at what point do they dump our bonds since they wouldn’t have to worry about funding our purchases of their goods?

Just throwing the question out there. It’s what has basically kept China from dumping our debt.

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The rich will celebrate the lower tax rate

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Where have you been? There are no rich, they all gave their money away, Gates, Buffet, etc. gave it all away to charity. Or should I say a trust fund, where they can now spend it freely without that bothersome tax thing.

Consumption taxes can fall under the umbrella of a tariff if specifically implemented in that format.

From Investopedia


Tariffs are used to restrict imports. Simply put, they increase the price of goods and services purchased from another country, making them less attractive to domestic consumers.
Governments impose tariffs to raise revenue, protect domestic industries, or exert political leverage over another country.
Tariffs often result in unwanted side effects, such as higher consumer prices.
Tariffs have a long and contentious history, and the debate over whether they represent good or bad policy still rages.



Consumption taxes are often levied at different rates on different commodities according to perceptions of whether a commodity is considered a necessity (such as food) or a luxury (such as jewelry).

The consumption tax is not a new idea. The U.S. government used a consumption tax for much of its history before replacing it with an income tax.

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We now spend about $10B/yr on the IRS. Adding 87k new agents alone will add $17B in payroll for IRS. No income tax, no IRS. We can save $25B/yr. Potentially less than that if all IRS employees are retired, not fired.
For less than $1B per year you can provide money to the states for them to go about collecting and forwarding the consumption tax.

It will be far easier and cheaper to run a consumption tax system.
Income tax punishes you for saving. Consumption tax rewards you. Nothing says you have to have the same consumption tax for baby formula as jet fuel, so the idea that the poor will suffer isn't that plausible. I'd argue the rich will pay more because their lifestyles are so heavy on consumption which does not come with loopholes. You buy a vacation home and it's charged like any other home - it can't be a write-off so you can travel to it and say you're working because it's close to another office of yours. Such distinctions go away. Additionally, states are still free to implement a 'negative income' tax or other means of assisting the poor if they wish, as Milton Friedman suggested.

Its not that hard to conceive slo pro. Most countries have a consumption tax, most states and local municipalities in the US have one, its called sales tax

The huge benefit is capturing a lot of the underground economy as well as taxing the 50 million illegals in the country. .

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I’m curious how foreign holders of our debt would react to this. If we tax the hell out of their exports to where we decease how much we buy from them, at what point do they dump our bonds since they wouldn’t have to worry about funding our purchases of their goods?

Just throwing the question out there. It’s what has basically kept China from dumping our debt.

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This is something that Trump never thinks about. He is fixated on tariffs for some reason.

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Consumption taxes are often levied at different rates on different commodities according to perceptions of whether a commodity is considered a necessity (such as food) or a luxury (such as jewelry).

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Frankly this is a major issue I have with the consumption tax. I don’t want govco deciding what I should or shouldn’t buy and adjusting the tax accordingly….which you know they will do unless this is explicitly prohibited.

It won't happen and voter won't hold Trump to the fire on it

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It won't happen

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It may not. It takes congress to pass it.

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voter won't hold Trump to the fire on it

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Again, just like the wall. When the American people send a mandate to DC in the form of the WH, Sen, and House, and Congress decides to go against the mandate, you blame the ones who went against it. You hold THEM to the fire.

If a President wins with a massive support for getting rid of income tax and gives the senate and house to the GOP and the house or senate blocks it... well.. That's who you blame. That's who you hold the fire to.