VAT hurts small businesses – they cannot pass along the costs and comply
Blasingame ’15 [Jim Blasingame 4-13-15,” A consumption tax is bad for America and worse for America’s small businesses,” Forbes, https://www.forbes.com/sites/jimblasingame/2015/04/13/a-consumption-tax-is-bad-for-america-and-worse-for-americas-small-businesses/#64c676012597, St. Mark’s School of Texas, Ashrit Manduva ‘24]
A consumption tax would also hurt small businesses disproportionately. Big businesses have systems in place to deal with new government compliance, like tax collection, and they always pass along expense increases to customers. Small businesses will be harmed because: We aren't always able to pass along cost increases, even a mandated VAT. New tax compliance and remittance will be prohibitively expensive. The sticker price of a national sales tax will take time for consumers to adjust to, which will hurt small businesses more. The only way we should consider any kind of a consumption tax is if it completely replaces the federal income tax, which would require repealing the 16th Amendment. Good luck with that because in the 227 years since the Constitution was ratified, only one amendment has ever been repealed - and that was to end prohibition.