Proposed new National Sales Tax pros and cons

In an effort to trim down the country's $1.4 trillion deficit, some economists have proposed that the United States begin using a national sales tax system.

Under this system, income tax, as we currently know it, would be eliminated and all taxes would come from the purchase of goods and services.

Here are some pros and cons to this system:

Pro #1: This system would eliminate all income taxes. All taxes would be collected at the retail level by busnesses. 

Pro #2: There would no larger be a need for income tax reporting, so no tax forms to fill out and no IRS to contend with.

Pro #3: Taxes would be imposed on everyone in the country, regardless of immigration status. This includes aliens, illegal aliens, and tourists as well. This alone could add billions to the nation's treasury.

Con #1: Since this is a consumption tax and low income families spend almost every dollar they earn on essentials, they would pay a higher percentage of their income in taxes. Higher wage earners could put more into savings and investments, which are not taxed under the new system.

Con #2: The benefits versus drawbacks of home ownership as opposed to renting becomes more complicated. For those who are able to buy a home, if they purchase a 'used' home they won't pay taxes. But, those who buy a 'new' home will. Renters will pay tax forever. And, since most states currently tax rental properties at a higher rate, this new tax plus the current tax may make it impossible for most renters to save enough money for a downpayment for a house, thus keeping them trapped in the undesirable position of renting.

These are just a few of the major issues with this idea. Just looking at these leads to more discussion about this system.

This system, while it seems to benefit homeowners, also seems to discourage new construction and purchase. And while it seems to encourage savings, as investments are not taxed, doesn't that in turn discourage spending? The very thing that, under this system, is supposed to generate income to offset the deficit?

It's seems that presently there are way too many contradictory issues to make this work here in the United States.

Currently, about 150 countries use a national sales tax system. Before moving forward with the idea here, let's evaluate how this system is working, or maybe not working, in these countries.

While we should applaud those in charge for looking for solutions to the current debt problem, there are many more faucets to this idea that need to be evaluated and discussed before there is any action taken.

Your thoughts on a national tax system?