NRF opines Tax Panel recommendations to push up consumer prices
19 Oct '05
3 min read
Leading retail trade organization The National Retail Federation (NRF) announced that Tax Panel recommendation would drive up consumer prices.
Prices for billions of dollars worth of consumer goods would be driven up dramatically under a proposal endorsed by the President's Advisory Panel on Federal Tax Reform that would end the corporate tax deduction for imported goods.
NRF Vice President and Tax Counsel Rachelle Bernstein informed that reform of the federal tax system does little good if it creates a huge new hidden tax for consumers. The vast majority of consumer goods sold in this country are manufactured overseas and the cost of that merchandise has always been deductible just like employee salaries or any other business expense.
If retailers can't deduct those costs, they will be forced to pass the added expense on to consumers. Anything taxpayers gain through lower tax rates or a simpler tax return could be lost through higher prices at the cash register.
Bernstein stated that a dramatic increase in the cost of imported goods could send consumer spending into a tailspin, taking all of the jobs associated with those goods along with it.
The Advisory Panel rejected a National Retail Sales Tax because of its impact on consumer spending and should realize that this proposal would have much of the same effect. Consumer spending has been the backbone of their economy in recent years and they can't afford to take this risk.
marketing@alchempro.com
