The Value-Added Tax: A New
Tax System for the United States
by
Joseph George Caldwell, PhD
Originally published as
How to Stop the IRS…and Solve the Deficit Problem
November 16, 1987
Printed in the United States of America
ISBN 0-944848-00-1
This e-book edition November 8, 2000
Copyright © 1987, 2000 by Joseph George Caldwell. All rights reserved.
Dedication
To the memories of George Orwell and Dr. E. Fritz Schumacher
To Mom and Dad, in Spartanburg
To Timigale
To Jay, Chris and Steve
Contents
Meaningful
Reform Is Sorely Needed
Why Would
the US Government Keep a Bad Tax?
The Income
Tax Can Be Replaced by a Good Tax -- The Value-Added Tax
The Tax
System Proposals of This Book Were Developed Through Systems Engineering
A Personal
Word from the Author
The US Tax
System Has Its Roots in the US Constitution
The
Original Constitution Outlawed the Income Tax
The US Tax
System Changed as Conditions Changed
The Income
Tax Began as a Low Tax on the Rich
For Many
Years, Inflation-Caused Bracket Creep Increased the Effective Rate of Taxation
The
Current Situation: Tax Revenues Are Derived from a Narrow, Volatile Base
Having a
Large Variety of Taxes Helps Hide Taxes by Keeping Tax Rates Low
The
Current Tax System Promotes Budget Deficits
The
Current Tax System Is Not Well Suited for International Trade
The
Framers of the US Constitution Had a Good Idea when They Outlawed the Income
Tax
The
Serious Inadequacies of the Income Tax Were Not Initially Apparent
The
Inadequate Revenue-Producing Ability of the Income Tax Has Turned the US into a
Debtor Nation
The Income
Tax Has Severe Sociopolitical and Economic Drawbacks
Problem
1. The Income Tax Has Destroyed the
Privacy of the American Citizen.
Problem
2. The Income Tax Has Spawned an
American Gestapo.
Problem
3. The Income Tax Has Weakened the
Constitution.
Problem
4. The Income Tax Is Unfair.
Problem 5.
The Income Tax Is Corrupting the Country.
Problem
6. The Income Tax Is Too Complicated.
Problem
7. The Income Tax Has Serious Economic
Deficiencies.
Problem
8. The Cost of Administering and
Complying with the Income Tax Is Very High.
Problem
9. The Income Tax Base Is Contributing
to Economic Collapse.
Tax Reform
Perpetuates Economic Distortions
Under Tax
Reform, the Income Tax Is Even More Complicated Than Before
Meaningful
Tax Reform Will Not Come Easily
The Income
Tax System Has Spawned a Big-Brother Watchdog Agency
The Income
Tax System Has Been Converted from a Tax on the Rich to a Tax on the General
Population
Many
People Regard the IRS as an American Gestapo
Through
the IRS, the US Has Established a Police State
The
Efficiency and Dedication of the IRS Are Misdirected
The
Personal Income Tax Forces Businesses to Act as Tax Collectors
The US
Income Tax System Is in Reality a Payroll Tax System
6. The Constitution Has Failed
The
Personal Income Tax System Has Weakened the Constitution
Tax Terms:
Marginal Rate, Average Rate, Graduated, Progressive
All People
Do Not Have the Same Utility Functions.
The
Progressive Income Tax Discriminates against Hard Work, Long Hours, and
Self-Improvement
The
Progressive Income Tax Weighs Heavily on Working Wives and Mothers
Tax Reform
Imposes a Heavy "Marriage Tax" on Many Families
The
Verdict: The Progressive Income Tax Is Unfair
The
Personal Income Tax Is Not Well Suited to Tax Capital Gains
Capital
Gains May Be More Apparent Than Real
"Tax
Reform Adjusts for Inflation" -- a Myth
The Real
Tax on Your Home's Appreciation May Exceed 100 Percent!