This is where our instincts fail us. https://www.taxpolicycenter.org/briefing-book/who-bears-burden-national-retail-sales-tax https://www.taxpolicycenter.org/br

This is where our instincts fail us. https://www.taxpolicycenter.org/briefing-book/who-bears-burden-national-retail-sales-tax https://www.taxpolicycenter.org/briefing-book/who-bears-burd... at the bottom (Figure 1) shows that the top quintile would have their share of current federal income tax move from 84% to 65%. The lowest quintile would have a disproportionate impact for them, but would not move the needle on actual revenue. (Right now they have a negative impact due to the EITC. This doesn't take into account social security and medicare, mind you.) The middle three quintiles would see their tax burden increase significantly. Consider that taxes are only 10 or 15% after your deduction until you get into the third quintile. The proposed sales tax would have to be 22% to be revenue neutral. If there is some sort of offset to disadvantaged households, you would need a 34% tax to sustain revenue. So their tax burden would go up. We don't really internalize how much more the top income brackets make and don't spend. The top 1% of Americans have about 16 times more wealth than the bottom 50%. https://www.cnbc.com/2021/06/23/how-much-wealth-top-1percent-of-americans-have.html https://www.cnbc.com/2021/06/23/how-much-wealth-top-1percent... - Their effective tax rate is going to be above 22% today, so even if they spent every last dime their taxes would go down, and as we know the wealthy are able to save more, so their tax burden will go down further still.