Thursday, April 22, 2010

Charlie Dent: National Sales Tax Unfairly Targets Low and Middle Income Workers

What is a VAT? It's short for Value Added Tax, a type of sales tax. As explained in the WSJ, it's "an invisible excise tax added to each phase of a product's production, really a national sales tax, with the cost of the total VAT ultimately paid by the final purchaser, regardless of his income or wealth."

Although an Obama spokesman has denied it's being considered, that assertion is disputed by the Executive Director of a White House panel charged with finding ways to reduce the national debt. Annual federal spending is projected to go from 1990 levels of $21k per household to somewhere around $42k in 2019. Since doubling income tax would be political suicide, that VAT is beginning to look a lot more appealing to government officials who refuse to cut spending. As George Will explains, "A VAT is collected on value added at stages during the process of production, but most of its burden is borne by consumers. They file no VAT returns, so its stealthiness delights the political class, which can increase it in small, barely noticed increments, with every percentage point yielding another $100 billion."

Yesterday, LV Congressman Charlie Dent signed on to a resolution offered by Rep. Todd Tiahrt, which would express Congress’ belief that a VAT would be harmful to America’s economy.

“One of my major concerns with the recent Health Care bill is that it puts America on the path of becoming a European-style welfare state, and a value-added tax would be a dangerous next step,” Congressman Dent said in a news release. “A value-added tax disproportionately and unfairly targets low and middle-income workers, and would be devastating to Americans on fixed income. By raising the cost on almost everything that is made, purchased or consumed in America, a VAT would further move our country toward a government-centered economy rather than one fueled by American innovation.”

The resolution noted that the VAT has been widely adopted by European nations and is routinely cited as encouraging public spending at the cost of private job creation. For example, Denmark enacted a 9 percent VAT in 1962, but today Denmark's VAT has surged to 25 percent.

“If we are to enjoy a sustainable recovery, we must entrust more economic power with the American people and less with Washington bureaucrats,” Congressman Dent said.

How does Dent's Congressional opponent, John Callahan, feel about a national sales tax? As Bethlehem mayor, Callahan recently advocated a 17% sales tax increase. To be fair, I called his campaign HQs and asked whether Callahan supports this national sales tax, especially since he has already supported an optional increase on a more local level. His communication director told me she'd either call or email me with his position. At the time this story is being published, I have no answer. If I get it, I will update this post accordingly. If I don't, you can draw your own conclusions.

51 comments:

Anonymous said...

Value added tax is used in Great Britain and it is a pain in the ass. Just say no!

Anonymous said...

Bernie,

The truth is that soon the levels of debt and spending will reach such levels that no amount of taxation will be able to cover the costs. Hope and Change?
Scott Armstrong

Anonymous said...

Bernie... what do you think John C's position will be? Answer... whatever Reid and Pelossi want him to be! That simple. As a Freshman Congressman, he WILL do whatever his leadership says despite what he may say on the campaign trail. Simple as that.

Anonymous said...

Can't wait until the LV Independents see this. It'll drive them crazy that Dent's advocating for lower and middel calss people. How will they spin it?

Anonymous said...

Anonymous said...
Can't wait until the LV Independents see this. It'll drive them crazy that Dent's advocating for lower and middel calss people. How will they spin it?

6:48 AM


I believe that he's only doing this cuz it's an election year. Almost every other bill he's voted for has been with the house democrats

Anonymous said...

No VAT until the income tax is made unconstitutional by via amendment. One or the other is bad enough.

I guess Obama finally figured out he'll need to mug the middle class if he wants to pay for all his spending. The top 5% already cover 85% of federal receipts. It's time to go after more money from the economic class that holds the majority of the country's financial and property value.

Rs should have fun running in November. D's are either in favor of the current staggering debt they've created (four times that of the previous administration), or in favor of crushing middle class tax increases - including the bomb that hits on 1/1/12 when the so-called Bush tax cuts are permitted to expire by Ds. Millions will lose thousands in monthly take-home pay.

monkey momma said...

This is reason #1 why Dent is going to leave Callahan in the dust in this election. Here's one registerd "D" who's voting for Dent AGAIN!

Anonymous said...

Why is Dent so silent about all the money it's costing to maintain two wars at once, neither of which is doing any good? Why is health insurance such a boogeyman?

Anonymous said...

Did Dent vote for Bush tax cuts for the rich? You know the whole story Bernie, why give us half of the hypocrisy.

Jon Geeting said...

This is exactly my point. Dent simply isn't serious about the deficit. At some point we're going to have to pay down the deficit. I think the responsible thing to do is raise revenue in addition to cutting spending. Charlie Dent thinks we should ONLY cut spending, but doesn't have the balls to get behind anything are gruesome as the Paul Ryan budget. There's simply no way to eliminate the deficit with only spending cuts (probably at all) but definitely not without the scale of the carnage in Ryan's budget. But he also says he's against cutting Medicare. So what is it? If you take all his claims at face value, there's absolutely no way it works out mathematically. And yet here Bernie is, eating up the too-good-to-be-true answers.

Bernie O'Hare said...

I tried to give yiou the whole story, but Callahan appears to be ducking yet another issue.

Bernie O'Hare said...

Mr. Geeting is attempting to continue an argument he lost ... badly ... at LVPoliblog yesterday. I invite readers interested in that to check it out.

Geeting, I'll take a pass at debating someone who resorts to name-calling. You can bray away on your own blog.

Bernie O'Hare said...

"Why is Dent so silent about all the money it's costing to maintain two wars at once, neither of which is doing any good? Why is health insurance such a boogeyman?"

Notice the attempts to divert attention away from the topic - a regressive national sales tax that will disprportionately impact the poor. This is eerily similar to that state sales tax increase option that Callahan advocated.

Bernie O'Hare said...

"I tried to give yiou the whole story, but Callahan appears to be ducking yet another issue."

I should not have said that. I spoke to his comm director around 10:30 AM yesterday, and it's a bit arrogant on my part to expect an answer so soon.

Jon Geeting said...

Nice try Bernie. In what universe did I lose the argument yesterday? I wholeheartedly encourage Bernie's readers to read the exchange. Bernie didn't respond to a single substantive point I made, and then he tried to conflate the Ryan amendment with the Ryan budget.

I asked why Dent didn't support the Ryan budget (which eliminates the deficit by 2080). Bernie responded that Dent supported a separate Ryan amendment as evidence that Dent is in fact serious about the deficit. I showed clearly why it does not reduce the deficit, and then Bernie continued to dodge the substance of my argument in another weird non-response. Strange way to "win" an argument.

It's exactly the kind of argument you'd expect from someone who doesn't understand anything about economic policy. Bernie probably thinks cutting earmarks and foreign aid would be good enough to eliminate the deficit.

Anonymous said...

"Although an Obama spokesman has denied it's being considered, that assertion is disputed by the Executive Director of a White House panel charged with finding ways to reduce the national debt."

See, Joe Wilson was right, of course. Obama Lies. As seen in so many videos of his campaign promises, or through a spokesman, teh One LIES.

Bernie O'Hare said...

It's no surprise to me that you've convinced yourself you're right. As already indicated, I refuse to debate someone who engages in childish name-calling. You engage in precisely the same kind of mean-spirited behavior that is properly condemned in extremists on the right. But the ony people you influence are other extremists.

Bernie O'Hare said...

The comment at 10:16 from me is directed at Geeting.

Anonymous said...

"Why is Dent so silent about all the money it's costing to maintain two wars at once, neither of which is doing any good? Why is health insurance such a boogeyman?"

The commander-in-chief could stop the wars today. He's chosen to stay in both and dramatically increase our participation in one of them. Health insurance is a boogeyman because it's going to require a VAT, or some other huge tax to be paid for. Obama knows the middle class has the assets and is getting the benefits from his goody bag. He's about to make the middle class pay.

Paul Harvey said...

"Did Dent vote for Bush tax cuts for the rich? You know the whole story Bernie, why give us half of the hypocrisy."

The bipartisan, although so-called Bush tax cuts, were easily passed in April 2001, when 15 Senate Ds joined 50 Rs after minor revisions to the House bill that was passed in March 2001.

Charlie Dent was elected in 2004 and took office in 2005.

And now you know ... the rest ... of the story.

Bernie O'Hare said...

Hey Paul, There you go, using facts.

Anonymous said...

"It's exactly the kind of argument you'd expect from someone who doesn't understand anything about economic policy."

Pot, meet Kettle.

Anonymous said...

Democrats claim to champion the poor.

Ha Ha.

The VAT tax will absolutely affect the poor more than anybody else by a country mile.

Don't need to be an economist with 6 PhDs to figure that one out. Common sense is enough.

Too funny to watch Democrats defend YET ANOTHER TAX.

(to fund their out-of-control, reckless spending and bribery)

This one will be great --- 20% on top of EVERYTHING!!!

Meanwhile, if European socialism is so great --- why don't all the Democrats just move to Europe and live happily-ever after?

I hear Greece is a fabulous place to be right now.

ROLF OELER

Anonymous said...

Paul
Dent voted for HB 5970
This bill would have raised the minimum wage, cut the federal estate tax permanently and extended several business tax breaks.
This was the cynical bill the Rs put forward with a minimum wage extension of a buck and a half over three phases and a elimination of estate tax on estate of up to 10 million! That's the "little guy" Charlie care so much about.

Anonymous said...

The bill would have reduce government revenue by 268 billion over ten years

Anonymous said...

Paul
Dent also voted on May 10, 2006 for HB 4297
This bill extended the Bush administration's previously passed tax cuts on dividends and capital gains

Anonymous said...

Anon 4:31- So you are saying that Charlie horrible because he supported an increase in the minimum wage and various tax cuts?

Anonymous said...

Dent voted on Feb 1 2006 for House Resolution 653

Cut nearly $40 billion from the federal budget by imposing substantial changes on welfare, child support and student lending programs.

Anonymous said...

Woo Hoo!

MORE TAXES.

Hooray.

Let's really sock it to those evil, greedy rich people who don't pay their fair share!

Awesome - Go Obama!

Oh wait --- EVERYONE will have to pay the 20% VAT TAX.

Hey --- I am not rich. I can't afford to pay 20% MORE on every single item I purchase.

LET'S JUST MAKE THE RICH PAY THE VAT TAX!

Yeah, that's the ticket.

PA REGISTERED DEMOCRAT and HUGE FAN OF LV INDEPENDENT

Anonymous said...

If I be like Goldman Sachs and contribute $ 994,795 to OBAMA's Presidential campaign war chest...

...can I be excused from having to pay the VAT TAX?

Anonymous said...

4:42
Saving the fat cats billions while allowing some crumbs to fall to minimum wage workers is cynical but not horrible(your word).

The topic was VAT. Charlie acts as if he cares about the middle class in election years

Anonymous said...

he votes 85% of the time with his party-a true moderate would vote much less along party lines

Anonymous said...

4:55

So anything contrary to the 'image' you would like Dent to have means he is being disingenuous? Get real.

Anonymous said...

"he votes 85% of the time with his party-a true moderate would vote much less along party lines"

Here is the typical number manipulation to try and prove he isnt what he really is, a centrist. Tried and failed argument. Next up, try to tie him to Bush. These tactics havent worked in the past and wont work now. Nice try.

Anonymous said...

Dent gets a C from this non-partisan org

http://www.themiddleclass.org/legislator/charles-dent-530?gclid=CPS7742bm6ECFciA5QodNG4uPQ

Anonymous said...

5:12 - Non-partisan...is that a joke? Nice try. Let's try sticking with facts as opposed to skewed numbers and partisan websites.

Anonymous said...

The supposed 'non-partisan' website quoted by 5:12 is a project by a group that by its own website states this its purpose is to generate "ideas that fuel the progressive movement." Sounds objective to me.

Anonymous said...

Heard Paul Volker quietly bring up the VAT at Kutztown's University's Decision Making Forum .....also heard some individuals suggest an National Asset Tax on our financial spending ...It ie not enought that they tax our income and investment interest ... And they tax our use of utilities ... That they want to tax a consumption and in PA the Governor wants totax our gratituities... Now they want to tax the principal of our financial amd real estate holdings while living and dead as well.

Can we put mouse traps in our wallets to sting their hands when they try to get into our pockets ...

Yours Truly from Dennis Pearson with eyes and hears wide open to the truth from whatever source it comes from ... The Lord Protect Us

Anonymous said...

attack the source;don't discuss his support for eliminating estate tax up to 10 million?
the progressive estate tax was instituted to keep our country a democratic republic where a person's vote meant something , where the control of wealth was not held by too few, where the middle class could continue to grow, it was a trustbusting time

Anonymous said...

n 1916 Congress for the first time levied a tax upon the transfer of a decedent's net estate. The Committee on Ways and Means of the U.S. House of Representatives explained that a new type of tax was needed, because the "consumption taxes" in effect at that time bore most heavily upon those least able to pay them. The Committee further explained that the revenue system should be more evenly and equitably balanced and "a larger portion of our necessary revenues collected from the incomes and inheritances of those deriving the most benefit and protection from the Government."

Anonymous said...

where would that 268 billion be coming from anyway if Dent had his way? The VAT would be the least of our troubles if we had to make up that money

Anonymous said...

anon 6:50 and 6:51

So now you dont want to talk about the so called "non partisan" source that you were citing. Maybe it is the fact that the source is about as non-partisan as the lehigh valley independent is "independent"...

Also interesting to note that the website you were citing is a progressive New York City group...wonder if Soros is behind it somehow...

Anonymous said...

Progressives hate the current United States and want a new one. They despise they middle class and want to make it behave their way and pay up.

Anonymous said...

"where would that 268 billion be coming from anyway if Dent had his way?"

If we had more Dent's in Congress and less Pelosi pawns, we wouldnt have to make up that $268 billion anyways.

Anonymous said...

"Dent also voted on May 10, 2006 for HB 4297
This bill extended the Bush administration's previously passed tax cuts on dividends and capital gains"

True, that. And this simple legislation unleashed billions in retained earnings into the economy via investor dividends. Hell, Microsoft declared their first in company history! 85% of us own stock and most of us own Microsoft! Capital gains taxes keep the Rockefellers and Kennedys in classes by themselves by preventing the successful from rising out of the middle class. Those families piled their money. They don't want anyone else doing the same thing. And they have useful idiots in the proletariat defending them. Bizarre.

Anonymous said...

Why should anyone believe anything that Jon Geeting writes. He lied about his stupid message about Dent's facebook status. And got caught. Still never owned up to it.

Anonymous said...

9:18
the capital gains tax is keeping someone who calls people "idiots" from rising out of the middle class?

Just how much capital gain income does the successful one need to rise up. and the 15% tax is all that's keeping you down?

Anonymous said...

Ask a family farmer or African-American entrepreneur those questions about how much is enough. They're being kept down by those who sit on piles of money already. You want new rules for them. They can have some money, but not as much as the Kennedys. Even Ted Kennedy would agree that emerging classes don't need all that dough. He went to his grave with his, though.

Anonymous said...

Hey, I have a couple of ideas to reduce spending...let's get the heck out of Iraq and Afghanistan. Those government contractors, like Cheney's friends at Haliburton are overpaid. Or, why did we bail out AIG (and therefore Goldman Sach) if we need money? Just saying, maybe we can't afford some of the things our federal government has gotten us into. Rather than burden the working class any more, maybe we should just stop spending.

Anonymous said...

Ha, ha, ha! Charlied Dent looking out for the lower and middle class! The same group that stands to benefit most from the Democrats' healthcare reform legislation. What a hoot! Thanks, I needed a good belly laugh.

Anonymous said...

4:05,

The real belly laugh is the Health Care legislation itself.

"Deficit neutral"

"If you like your Doctor, you can keep your Doctor"

Government-funded abortions.

And on and on and on.

Thanks for the chuckle.

Perhaps when you get your End Of Life Counseling you will understand!