The Compact for a Balanced Budget advances a specific Balanced Budget Amendment that you can read today, and which four states have already contractually committed to ratify. Read it here.
Section 5 of the Compact's Balanced Budget Amendment imposes a default rule of requiring two-thirds of each House of Congress to pass any new or increased income or sales tax (including a VAT). It expressly or implicitly excepts from this default rule: 1) revenue increases from a new consumption ("end-user sales tax") tax that completely replaces the income tax; 2) revenue increases from closing tax loopholes; and 3) revenue increases from excises, imposts, fees, fines. These exceptions retain the current simple majority approval rule.
Seems simple, but section 5's tax limit is where we are most often stunned at the opposition's illogical analysis. For instance, the opposition often claims that our amendment's imposition of a two-thirds vote requirement on new or increased income or sales taxes, including possible VAT taxes, somehow makes it more likely we will get a VAT tax!
That is just not possible.
The federal government already has the power to impose a VAT tax with simple majorities (51%) of Congress under the Constitution as it currently exists. How can requiring two-thirds (66%) under our Amendment as opposed to 51% of Congress to vote up a VAT tax make a VAT tax more likely?
Obviously, it can't. Nor is the likelihood of getting a VAT tax increased by the provision of our tax limit that allows for a simple majority vote to impose a new consumption tax IF it completely replaces the income tax.
The opposition's critique of section 5's tax limit boils down to the contradictory claim that taxes will be increased by making it more difficult to increase taxes!
As we scratch our head to try to understand how the opposition thinks it can get away with this, we do notice that the opposition pours on the name-calling when advancing this ridiculous critique. Often, in conjunction with criticism of our tax limit, our amendment is called "a monstrous trick," "trickery," "tricky," etc. Essentially, blustery name calling is used to bulldoze the reader into thinking that the opposition's critique makes sense.
It doesn't make sense, however. As you can see.
Tomorrow, we will address the last section of the Compact's BBA.