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Thursday, April 08, 2010

Is the VAT a Problem?: Two Tax Professionals Say "Yes"

SBE Council released a short paper today on the Value Added Tax (VAT). In the brief -- "The VAT: Is it a Problem?" -- two tax professionals explain the VAT and cover the methods by which a business could calculate and pay the tax. The authors report on the effects of, and problems with, the imposition of a VAT.

The issue of how to pay for President Obama's ambitious agenda, the federal government's existing liabilities, and the nation's crushing debt is driving the debate on whether Congress will have to raise taxes. One of the ways being discussed to raise substantial sums of revenue is the imposition of a VAT. Floated by Paul Volcker, who is heading up President Obama's tax reform commission, the tax would be levied on top of the current income tax system.

SBE Council member Leonard Steinberg, principle of Steinberg Enterprises, and Certified Public Accountant Paul Nagel, who is also a Certified Financial Planner and Assistant Professor of Business, City University of New York, authored the brief.

In the piece, they conclude: "Instead of a tax system that is more equitable and transparent, the imposition of a VAT creates greater complexity with no end of onerous taxation in sight."

To access "The VAT: Is it a Problem", please click here.


Karen Kerrigan, President & CEO

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