Quote:
Originally Posted by PeteMoss
At least in Europe - they have high VAT rates (25% in Sweden) but not much lower (or higher) income tax rates.
What country follows your model?
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I don't know about a country (maybe there is one and maybe there are none?), but there are several US states that have no income tax and only consumption taxes. It seems like that would be trickier because people could shop across the state border and kind of arbitrage. For example, I have a family member who lived in Vancouver Washington and shopped in Portland Oregon. No income tax in Washington and no consumption tax in Oregon.
Anyway...there are real world examples there this is in operation. I don't know if there are countries, and I don't know if it would work in Canada. But consumption taxes are pretty widely acknowledged as being more efficient than income taxes.