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Comment by tim333 | Hacker News Reader

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tim333·

VAT is basically just a fancy sales tax. You've got to get money for education, health and the like somehow.

HK and Singapore did have low tax and small government which probably helped them.

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So... VAT is a better approach than tariffs because it does a lot more economic damage? That's not very compelling.

Why forgive VAT what we can't stand in tariffs?

This is like saying income tax is a tariff because it stops people from buying more imported product.

It's like saying income taxes and tariffs do their damage in similar ways. They do. Income taxes are another thing that mostly just hurts the country introducing them.

Lets extend your logic then: VAT is another thing that mostly just hurts the country introducing them.

Is the United States trying to free Europeans from the tyranny of their government? Americans should also stop paying sales tax and income tax.

Not true. VAT does way less economic damage. Tariffs introduce massive distortions in the market.

What does VAT have to do with anything? What are you even trying to say? It applies both to domestically produced products and imports in the same way..

> Why forgive VAT what we can't stand in tariffs

Now replace VAT in that sentence with incomes tax, alcohol duty, property taxes.. makes no sense.

VAT applies equally to domestic and imported products and doesn't affect the balance. Tariffs only apply to imports, thus giving domestic producers an advantage (either lower prices or higher profit margins).

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