America will never have a European-style welfare state without a VAT
Democrats want European-style spending but without the efficient tax that makes it possible
AS GOVERNMENTS SPEND more, it becomes increasingly important that they design their taxes carefully. Large European welfare states such as Sweden or Germany rely on growth-friendly value-added taxes (VATs) to help raise the vast quantities of cash they dole out. America can get away with a tax system that is grossly inefficient and needlessly complex only because the amount of revenue it raises overall is relatively small.
This article appeared in the Leaders section of the print edition under the headline “Ways and means”
Leaders October 2nd 2021
- How to revive Britain’s stockmarket
- China’s new reality is rife with danger
- Japan deserves better than an inoffensive prime minister
- Why the word “woman” is tying people in knots
- America will never have a European-style welfare state without a VAT
- New ways to make food are coming—but will consumers bite?
From the October 2nd 2021 edition
Discover stories from this section and more in the list of contents
Explore the editionMore from Leaders
Sir Keir Starmer should aim higher in his reset with the EU
And he needs to be clearer about what Britain wants
To make electricity cheaper and greener, connect the world’s grids
Less than 3% of the world’s power is internationally traded—a huge wasted opportunity
Chinese AI is catching up, posing a dilemma for Donald Trump
The success of cheap Chinese models threatens America’s technological lead
America has an imperial presidency
And in Donald Trump, an imperialist president for the first time in over a century
Tariffs will harm America, not induce a manufacturing rebirth
Donald Trump’s pursuit of tariffs will make the world poorer—and America, too
How to improve clinical trials
Involving more participants can lead to new medical insights