With this consumption tax there would be a rewriting of the tax code and it will be interesting to see how they exempt basic living expenses. I would imagine that someone making one million dollars per year certainly spends more on higher end products than your average American. In that way the wealthy would pay more in taxes. A consumption tax paired with eliminating income tax would allow Americans who are stuck living paycheck-to-paycheck to have more money in their pockets to help drive the economy.
Implementation is everything. This is where what is exempt from the consumption tax becomes important. Should we really tax Americans for paying for the cost of having a roof over their head and utilities within that structure? I would think not. There are necessities of living like food that should be exempt. So if that is part of it, and more luxury and discretionary spending is what falls within the consumption tax then I could actually see how that could be a benefit to Americans. The impetus for Republicans is one of conservative principles, which is liberating the American consumer from the absolute fear and paralysis of checking the wrong box or claiming the wrong tax credit and finding themselves in an audit. That has been the issue for people who have been on the lower end of the income spectrum.
Pamela Denise Long is CEO of Youthcentrix® Therapy Services, a business focused on helping organizations implement trauma-informed practices and diversity, equity, inclusion, and antiracism (DEIA) at the systems level. Connect with Ms. Long online at www.youthcentrix.com or @PDeniseLong on social media.
The views expressed in this article are the writer’s own.
