The Corner

Doug Elmendorf’s Brain in a Vat

CBO Director Doug Elmendorf told a group of reporters today that he has been receiving “a lot of questions” about a potential value-added (VAT) tax on goods and services.

The questions follow favorable comments from Obama economic adviser Paul Volcker on the possibility of replacing or scaling back the federal income, and reducing the deficit, via the VAT.

“Many people in Congress are interested in it,” he said of the VAT, a national sales tax that adds between 10 and 20 percent to purchases in European countries where it’s been implemented. “We’ve had conversations with a number of members and their staffs.”

Elmendorf declined to specify which members and said he has yet to field an official request to study a VAT tax. The CBO is in the process of figuring out how best to study a VAT tax’s impact, sorting through various structures employed by other countries. Elmendorf also declined to estimate what a VAT tax level would need to be to cover the 2020 debt, which the CBO predicted will be 90 percent of GDP.

But Elmendorf also told reporters that a VAT “would be subject to many of the same (tax) preferences the income tax is subject to,” and “could become very complicated.”

Daniel FosterDaniel Foster is a former news editor of National Review Online.

Most Popular

World

Why Trump’s Mideast Peace Deals Matter

After Israel’s resounding victory over the Egyptian, Jordanian, and Syrian armies in 1967, the Jewish state again offered the Arab world peace in exchange for recognition. And it was again rebuffed. Instead, the Arab League convened in Khartoum to formulate a consensus response that became known as “The 3 ... Read More
World

Why Trump’s Mideast Peace Deals Matter

After Israel’s resounding victory over the Egyptian, Jordanian, and Syrian armies in 1967, the Jewish state again offered the Arab world peace in exchange for recognition. And it was again rebuffed. Instead, the Arab League convened in Khartoum to formulate a consensus response that became known as “The 3 ... Read More
National Security & Defense

Jared Kushner Was Right

Over the past several years, a new certainty was added to death and taxes: Jared Kushner would fail in his role as the administration’s Middle East point man. It caused considerable merriment among President Donald Trump’s critics (and even some of his well-wishers) when he put his son-in-law in charge of ... Read More
National Security & Defense

Jared Kushner Was Right

Over the past several years, a new certainty was added to death and taxes: Jared Kushner would fail in his role as the administration’s Middle East point man. It caused considerable merriment among President Donald Trump’s critics (and even some of his well-wishers) when he put his son-in-law in charge of ... Read More

Battleground Arizona

At an August 11 Trump-campaign event in Mesa, Ariz., the state’s Republican governor, Doug Ducey, noted in his remarks introducing Mike Pence that President Trump and the vice president “have visited the state of Arizona more than any other presidential administration in the history of our country,” adding: ... Read More

Battleground Arizona

At an August 11 Trump-campaign event in Mesa, Ariz., the state’s Republican governor, Doug Ducey, noted in his remarks introducing Mike Pence that President Trump and the vice president “have visited the state of Arizona more than any other presidential administration in the history of our country,” adding: ... Read More

The Consequences of Biden

If you have decided that another four years of Donald Trump would be intolerable, and the prospect of four more years of the dysfunctional Trump circus in the White House fills you with dread, fine. But approach the prospects of a Joe Biden presidency with clear eyes and no illusions. Electing Biden would move ... Read More

The Consequences of Biden

If you have decided that another four years of Donald Trump would be intolerable, and the prospect of four more years of the dysfunctional Trump circus in the White House fills you with dread, fine. But approach the prospects of a Joe Biden presidency with clear eyes and no illusions. Electing Biden would move ... Read More