Far as demand stimulus ideas go a national sales tax holiday is an interesting one I hadn't heard before. It might make the most sense now in light of the fact that any plan would have to pass the Stupid Republican Keynsianism test. How are they going to insist on tax cuts in a stimulus bill that is a tax cut? I'm sure they'd find a way, but I'd like to see what they came up with.
The cut should only be 4%, though, too many states have a sales tax under 5%, and the sales subsidy disbursements would be a headache. There's no obvious reason why consumers wouldn't direct the savings from purchases into more consumption, rather than more savings, either.
:: posted by buermann @ 2008-10-31 16:33:02 CST |