Is the national sales tax in the United States inevitable?

It seems that a government that cannot control its spending will have to find innovative way of raising revenues. The United States will have to follow the lead of Greece in cutting back spending and finding new sources of income.

The United States federal government now has to borrow around 42 cents for every dollar it spends.

That is, the American taxpayers contribute 58 cents, but the government spends a full dollar or 100 cents. If the taxes were to meet expenditures, taxes would have to increase. So instead of paying just 58 cents, taxpayers would pay 100 cents. That’s a whopping 72.4% increase in tax payments.

It’s pretty easy to see that Americans will not easily accept a 72.4% increase in their income tax rates. Any politicians who allows that will be quickly voted out of office. But sneak in a national sales tax or VAT an you may get away with if.

So, what is required?

National Sales Tax in the United States Inevitable?

In order to raise needed revenue, new, innovative taxes need to be developed. One Republican candidate for the Presidency is attempting to put forth a national sales tax as one means of reform. But, will this be enough?

Most people believe that a new national sales tax, even at 9%, would simply be a foot in the door and tax rates would quickly increase.

Coupled with this is a flat income tax of 9%, with no deductions. This is also not set in stone and would likely have to increase. But, at least there would be no deductions and tax bills would be easier to calculate.

Another alternative to the direct sales tax is the value added tax or VAT. Popular in other countries, the VAT is just another way of increasing government revenues. This video helps explain how a VAT tax would work:

VAT Explained

Greece, now going through the difficult time of trying to equalize revenue and expenditures could be a model for America. Look at this report and see if your see our soon-to-come future.

Andrew Simmons reports on the Greek debt crisis

Though the United States still has its own currency, it is rapidly losing value in the eyes of the world. To stabilize the dollar a national sales tax or VAT may be required.

Gold, with a steady long-term value, requires ever more dollars to purchase an ounce of gold. This trend will continue as the dollar loses more and more value.

What can you do about it?

Simply, start buying currency of lasting value: gold.