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The question being asked is the last paragraph that starts with do you think... Much of Europe operates under a VAT tax regime (VAT
The question being asked is the last paragraph that starts with " do you think..."
Much of Europe operates under a VAT tax regime (VAT stands for Value Added Tax), where consumption is taxed at an average rate of 21%. This means that if you go out to a restaurant and purchase a meal, for example, you would spend an additional 21% of your total bill on the VAT tax. Currently, 45 U.S. states collect a sales tax, which is similar but has many exceptions (including on groceries) and, at the highest rates, amount to about 9%. Since a high tax on something reduces the desire to do it, a VAT tax reduces consumption. In a place with a high VAT tax and a low interest income tax, you would be more likely to save, because consuming is expensive (tax-wise ) while saving is less expensive (tax-wise). do you think it would be good for the U.S.'s long-term economy to adopt a VAT tax system and decrease interest income taxes? Support your answer as to why or why not. Remember to define what you mean by a "good" economy in terms of overall wealth, inequality, the budget deficit etcStep by Step Solution
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