ENDORSED: Maybe It’s Time To Cut The Federal Government In Half. “This would leave Federal spending limited to: the military, debt service, retirement benefits for Federal employees, and “everything else.” This too could eventually be cut in half over time. At present, these categories constitute 38% of Federal spending, or 7.9% of GDP. This reduced spending commitment could be funded with a much simpler tax system. To produce revenue of 7.9% of GDP, a single, simple tax like a 10% Federal sales tax or VAT would suffice. No more Federal income or payroll taxes. This should probably be codified in a Constitutional Amendment, modifying or eliminating the Sixteenth Amendment.”