Policymakers are considering a VAT as a possible way to reduce the federal deficit, which is currently at its highest as a share of GDP since World War II.
"Hundreds of thousands of people who have jobs today would find themselves out of work," said Matthew Shay, CEO of the National Retail Federation. "Clearly, a VAT would be part of the problem, not part of the solution."
Ernst & Young conducted the research, along with Tax Policy Advisers. They focused on a "narrow-based" VAT, and assumed that it would apply to most consumer goods and services, with exemptions for items such as health care and groceries.