I orginally posted this to another forum member. But I really would like feedback on it. There may be flaws I don't see right now. Weigh in.
Our current federal budget is 4.11 Trillion dollars. If we include State and local budgets, that number becomes 6.41 Trillion. So, it costs us 6 1/2 Trillion per year to run our country right now. If we got rid of all taxes, which would also scrap the IRS and all county auditors by default, and including the scrapping of all state and local taxes, we could come up with that amount from 1 single tax- a universal flat sales tax.
There were 56 Trillion dollars in purchases in 2017 in the US, only 612 Billion of which was at grocery stores. Of those Grocery chain sales, only about 120 billion was on actual food.
If we tax everything except food, we still end up with 55.9 Trillion in taxable sales. If we set our sales tax at 12%, that would be 6.7 Trillion in tax revenues. Distributed correctly, that would cover the entire cost of government as we know it today at 6.41 Trillion.
Bear in mind this would eliminate ALL other forms of taxation. This would also make it so everyone pays their own share equally, and with no IRS, there are no write-offs, refunds, or loopholes. When poor people buy something for a dollar, 12 cents goes to taxes. When a wealthy person buys a $200,000 car, $24,000 goes to taxes. Both the rich and the poor would pay their own way, equal to their economic capacity. And to keep things fair, I have subtracted the 120 billion in actual groceries. I don't think we should pay taxes on food, water, or air, as they are human necessities.
But restaurants, fast food joints, those should be included in the sales tax.