Statement of John G. Wilkins, Managing Director,
Barcroft Consulting Group, on behalf of National Retail Federation
Testimony Before the House Committee on Ways and Means
Hearing on Fundamental Tax ReformMr. Chairman and Members of the Committee:
I am managing director of the Barcroft Consulting Group and I am here on behalf of the National Retail Federation. My statement reports on the findings of a study undertaken by PricewaterhouseCoopers ("PWC") for the National Retail Federation Foundation. I was principal author of that study, which examines the economic impact of substituting a national retail sales tax ("NRST") for the federal income tax.
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Conclusion
If a NRST is enacted, the U.S. economy would lag behind for at least three years and employment would dip by more than one million jobs. Beneficial effects would not be felt for at least five years after adoption. While it is admirable to seek a fairer and simpler tax structure to replace the incredibly complex income tax code, trading an income tax in for a national sales tax is an experiment that could bring serious harm to a flourishing national economy. Uncertain long-run benefits are far insufficient to risk the short-run setbacks in virtually all sectors of the economy.
"My statement reports on the findings of a study undertaken by PricewaterhouseCoopers ('PWC')"
That would be the same PWC that bills several hundred million $$$ annually for tax preparation and consulting services.
"If a NRST is enacted, the U.S. economy would lag behind for at least three years and employment would dip by more than one million jobs."
According to Dr. Dale Jorgenson, former chairman of the economic department of Harvard University, GDP growth in the first year after implementation would be 10.5%. How many on this thread have ever experienced 10.5% GDP growth for a full year? Is it reasonable that, during a period of tremendous economic expansion, that jobs would be LOST?