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To: KyrosL who wrote (52008)	8/2/2004 12:41:09 PM
From: Cogito Ergo Sum	Respond to of 74559

Sadly I think you are correct. That's what happened up here (hence my comment)... with our VAT the GST (colloquially known as Gouging and Screwing Tax :o) or as it's officially known the Goods and Services Tax... The last Conservative government brought it in and unfortunately dropped the ball on being really innovative by maintaining income tax and adding a lot of ifs ands or buts to the GST...... I like the concept (in principle) because it rewards savings and investment...

To: KyrosL who wrote (52008)	8/2/2004 8:03:34 PM
From: Tapcon	Respond to of 74559

One significant problem with VAT is that it is a regressive tax, whereas income tax is a progressive tax, (at least in theory.) That is, a VAT tax, similar to sales tax, extracts a greater proportion of a poor person's income than it does of a wealthier person's income. In practice, however, the VAT encourages development of an underground economy, especially in the services trades. I now live in Chicago, after 23 years in Canada. I am astounded by the size of the underground economy in this city. It would not surprise me to learn that one-quarter to one-third of this economy is a cash economy that avoids taxation completely. Going to a VAT tax would encourage this even more. Also in practice under the current system, however, are the wealthiest individuals in this country who can hire the sharpest tax accountants who are able to tell their clients: "How much tax do you WANT to pay? None? We can do that." I agree that that the US tax system is an abomination that should be replaced and think it is a complete disgrace that most people have to hire a professional tax service to prepare their returns. I favor a graduated flat tax. The problem with all reforms is trying to get a handle on "annual income", so says a buddy who was a Director of Taxation Policy in Canada. Did hear another proposal though to simplify all those tax forms to one form containing only two lines: 1. How much did you make last year?_______. 2. Send it in.