Taxing consumption is usually synonymous with some version of a Value-Added Tax, (VAT) which is slowly gaining acceptance among liberals.
Each participating n ation will raise the taxes through its own
taxing authority, based on a globally agreed tax rate and
taxing policy plan.
What do you do when you've moved to a territorial tax system and are no longer
taxing foreign source income?
The marginal rate applicable to the last dollar of taxable income is expected to vary by year in a
taxing jurisdiction that has graduated tax rates.
This test involved an analysis of four factors: (1) substantial nexus with the state, (2) fair apportionment of the tax, (3) nondiscriminatory effect of the tax and (4) fair relationship of tax to services provided by the
taxing state.
Let me offer two brief examples--our regime for
taxing foreign base company income under Subpart F and our foreign tax credit regime, both of which impede our ability to compete.
But the Founders' dream of a robust United States took a long time to come to fruition because the
taxing power, lay largely dormant for the first 70 years after the Constitution was ratified.
Both would restore fairness by
taxing at one low rate.
Consumption could be taxed directly such as by a sales tax, by allowing a deduction for savings (and
taxing savings withdrawals) or by exempting earnings on savings and investment.
Dakin: Well, that's because we're indirectly
taxing the local hospital, the universities, and our churches--all of whom are investors in the stock of corporations.
