On October 22, 1979, Representative Al Ullman (D-Ore.), then Chairman of the House Ways and Means Committee, introduced the Tax Restructuring Act of 1979, which would have lowered the rates of the individual income, corporate income and social security taxes along with certain other tax benefits and would have replaced the lost revenues from such reductions with the revenues from a 10% value-added tax (VAT). The introduction of the bill followed a speech delivered by Sen. Russell B. Long (D-La.), then Chairman of the Senate Finance Committee, at the 1978 Tulane Tax Institute, in which he advocated an overhaul of the tax system similar to the proposals contained in Ullman's bill. Although there was nothing particularly novel in the proposals of Long and Ullman, the mere fact that the two members of Congress with the most influence over tax legislation were advocating a major overhaul of the entire tax system was enough to spark a lively debate on the merits of substituting a value-added tax for part or all of the components making up the present federal tax system in the United States.
John F. Kelly, Joseph L. Lewis & William J. Irvin,
Replacing the Social Security Tax with a Value-Added Tax: Policy Perspectives,
U. Rich. L. Rev.
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