Is It Time To Switch Income Tax With A Sales Tax

A great strength of a consumption tax system is that it does not tax saving and also gives firms more incentive to invest.

Of course, any large change in federal taxation has complex effects, including from its interaction with state and local tax systems.

And the US Congress probably has an innate bias in favour of a complex tax system with lots of loopholes and exemptions, giving members leverage over potential donors.

But that is all the more reason to jump at the opportunity to clean up the system and help mitigate wealth inequality at the same time.