Press Releases

Luetkemeyer Opposes Devastating Value Added Tax In Letter to Presidential Commission

Washington, DC, May 21, 2010
In an effort to protect hard-working Missouri families from tax increases during tough economic times, U.S. Rep. Blaine Luetkemeyer (MO-9) today signed a letter calling on a presidential commission to reject calls for a Value Added Tax and instead focus on reducing government spending.
In an effort to protect hard-working Missouri families from tax increases during tough economic times, U.S. Rep. Blaine Luetkemeyer (MO-9) today signed a letter calling on a presidential commission to reject calls for a Value Added Tax and instead focus on reducing government spending.
 
In a letter to the co-chairmen of the President’s Commission on Fiscal Responsibility and Reform, Luetkemeyer said the Value Added Tax (VAT) has had devastating effects on the economies of Europe where it has been implemented, and would be even more disastrous for the United States. A VAT is a tax on the estimated market value added to a product or material at each stage of its manufacture or distribution, ultimately passed on to the consumer.
 
“A VAT will increase the cost of goods and services for all Americans, including the lower and middle income classes. It will tax our manufacturers, sending even more jobs overseas. And, it will decrease consumption, which will deepen the recession and suppress entrepreneurialism,” Luetkemeyer said in a letter signed by more than 150 of his House colleagues. “This is exactly what has happened in Europe where increased government spending and taxation has led to consistently high unemployment and suppressed economic activity.”
 
Luetkemeyer, who has voted against massive government spending programs including the so-called stimulus plan and nationalized health care, said that government spending is out of control and that instituting a VAT could place the United States in the same situation as Greece, which has a 19 percent VAT.
 
“Adding a VAT to an overly burdensome tax code will destroy American jobs and crush American innovation,” Luetkemeyer said in the letter to commission co-chairmen Erskine Bowles and Alan Simpson. “We urge the commission to consider other ways to rein in out of control government spending.”
 
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