Certainly people will evade a sales tax, they already do. But they evade the income tax too. There are several huge advantages to a sales tax. It’s much simpler, the tax code would be a tiny fraction of its current size. Hundreds of billions of dollars and countless millions of man hours are wasted dealing with the income tax code, that money and time could be diverted to productive endeavors.
Money made from savings and investments is not taxed so there is more incentive to save and invest. It would get the government out of your financial business. It would make the US much more competitive since goods sold overseas would not have tax built in, as they now do.
Everyone would again be a taxpayer, now the top 10% of income earners pay the vast majority of income taxes and 50% pay little or nothing . If everyone pays taxes then everyone cares about tax rates.
Since sales taxes are collected by the states it would make them more powerful relative to the feds. The advantage there is that next time congress tries to blackmail the states into doing something they can respond by not sending in the feds cut. It would also give the government much fewer opportunities the screw with us. No more tinkering with the tax code to advance the favorite social policy of the day.
Disadvantages are few but significant. The relatively poor must use a higher percentage of their income to pay the taxes. That could be offset by exempting food and certain basic necessities.
