A national sales tax is a variant of the general tax on comprehensive consumption discussed by Hyman (2014) in Chapter 16 of the course text. There are many arguments in favor of replacing the myriad different sales tax rates found across the United States with one national sales tax. At present, tax rates vary among the states and localities that assess a sales tax. For instance, some states exempt food and/or clothing purchases from sales taxation. As retail sales continue to migrate to the Internet, a significant issue is whether these sales should be subject to sales taxation in the state in which a purchase is delivered. For this Assignment, consider your experience as a consumer with both online and physical "brick-and-mortar" stores and whether sales tax has affected your buying decisions.

• Examine the economic effects that would result from replacing state and local sales taxes with one national sales tax on all consumption, including consumption of services. For example, the federal government would collect the tax and return the revenue collected to the state governments.
• Describe how replacing state and local sales taxes with a national sales tax might change consumer behavior.