Home / Knowledge / News / Apparel/Garments / NRF urges US Congress to reject consumption tax
NRF urges US Congress to reject consumption tax
25
Mar '16
The National Retail Federation (NRF) urged the US Congress to reject any form of consumption tax and instead focus on changes to the income tax system that would broaden the tax base in return for lower rates.

“Replacement of our current income tax system with a consumption tax system would cause great disruption to the US economy,” David French, NRF senior vice president for government relations said.

“Congress should not consider making this type of change at a time when the economy is stagnant and consumer confidence is so low,” French observed in a NRF press release.”

French added by saying that adding a consumption tax on top of the current income tax would have even more negative consequences.

French's remarks came in a letter to the House Ways and Means Committee, which is scheduled to hold a subcommittee hearing on consumption tax proposals as part of a series of sessions on tax reform.

According to NRF, rather than taking testimony from affected parties, the Tax Policy Subcommittee is hearing from lawmakers who have proposed legislation on the issue.

NRF and a number of leading economists have argued that that the measures would bring higher prices that would decimate consumer spending, which makes up two-thirds of the nation's economy.

“Regardless of label, the proposals under consideration in this hearing are all consumption taxes and is the wrong time to consider a tax system that would increase the tax burden on consumption,” French noted.

According to French, consumption taxes are borne disproportionately by low and moderate-income families, who spend a higher proportion of their income than wealthier families.

“NRF believes a better approach to tax reform would be through income tax changes that would lower rates and broaden the base,” French noted.

“Studies have shown that this type of tax reform would have a favourable impact on the economy, wages and retail spending,” NRF also observed.

A 2010 Ernst and Young study commissioned by NRF found that adding a 10 per cent VAT to the income tax would result in the loss of 850,000 jobs in the first year.

“It would also reduce gross domestic product for three years and bring a permanent drop in retail spending totaling $2.5 trillion over the first 10 years,” NRF added by quoting the report.

A PricewaterhouseCoopers study conducted for NRF in 2000 said a flat tax would bring a five-year decline in GDP and a six-year decline in consumer spending.

While a National Retail Sales Tax would bring a four-year decline in GDP and an eight-year decline in spending.

By contrast, a 2014 review by the congressional Joint Tax Committee found that broadening the base by limiting tax deductions and using the revenue saved to lower rates would cause consumer spending and GDP to grow. (AR)

Fibre2Fashion News Desk – India


Must ReadView All

Apparel/Garments | On 26th Sep 2017

US raises annual AGOA quota for textiles

The US Committee for the Implementation of Textile Agreements has...

Textiles | On 26th Sep 2017

Thrace-LINQ expanding Dorchester County operations

Thrace-LINQ, a global supplier of fabrics for the textile industry,...

Courtesy: Levis

Fashion | On 26th Sep 2017

Google unveils smart denim jacket with Levi Strauss

Ending the months-long wait, Google has unveiled its smart denim...

Interviews View All

Dharmendra Shah
Ozone PB Spintex Limited

‘We have made huge investments to ensure quality yarn production.’

Poojaa Kumar Deepak
Zeven

Zeven's performance sports apparel is designed for the Indian body type,...

Yashiki Gumber
Sahiba Fabrics

Fabric does not restrict us from fashion trends

Kerem Durdag
Biovation II LLC

Kerem Durdag, CEO, Biovation II LLC, provides an insight into future...

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Eric Scholler
Groz-Beckert

The Indian market has huge potential in technical textiles, and by far,...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Vaanee Bhatia
Gritstones Clothing

<div>Delhi-based Gritstones Clothing offers quality and exemplary style...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

September 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
75.5%
No
12.2%
Skip
12.2%

Total Votes: 49

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
63.3%
No
24.5%
Skip
12.2%

Total Votes: 49

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.8%
No
6.1%
Skip
6.1%

Total Votes: 49

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
71.4%
No
10.2%
Skip
18.4%

Total Votes: 49


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search