Quote Originally Posted by FastMan View Post
Do you mean on the materials they are using to produce their products? And do you mean in the system I'm proposing? If so, I would think not, regardless of the source of those materials. Consumption tax only gets applied at the end user point. And the domestic advantage would still exist.
No, I was referring to companies that would import cheap consumer goods from abroad rather than produce them here.




I see what you're thinking, Rucker, but read my answer above. It should address your question/concern. The advantage the consumption tax system provides to the American producer when selling their products domestically would be very helpful to them in competing with producers who have the advantage of lower labor costs.
That depends sales tax rates vs cost of foreign goods. Without numbers we're just guessing which is better. A larger flaw is that higher consumption tax rates will drive consumption revenues down, through fewer purchases or through purchasing cheaper goods with a lower total cost.