Gold Dealers Peeved by New Tax Law
Source: Seeking Alpha, Craig Pirrong (7/23/10)
"Gold dealers up in arms over provision in health care law."
The ostensible purpose of this provision is to permit the IRS to capture billions of dollars of taxes on transactions that currently go unreported. That was necessary to make the health care bill pay for itself. Or, I should say, it was necessary to make pretend that the health care bill pays for itself. Any sentient being knows that it can't, won't and never will—blizzards of 1099s or no.
But there is something more worrisome about this provision. Virtually exhaustive documentation of transactions is necessary to make a value added tax work. I suspect, therefore, that the true motive—or, at least, a collateral benefit in the eyes of our tax junkies in Washington—of this provision is to lay the administrative and operational foundation for the adoption of a VAT. . .just saying.