In his Nov. 7 op-ed piece, Laurence J. Kotlikoff said that "a retail sales tax is equivalent to taxing all wages plus all wealth." But how would Bill Gates, under his example, pay taxes commensurate with his income through a retail sales tax? A sales tax puts a disproportionate burden on lower-income earners because retail purchases make up a much larger percentage of their incomes.

If Mr. Kotlikoff thinks payroll taxes are highly regressive, why doesn't he suggest that everyone pay Social Security taxes on all of their income (rather than exempting income over a certain level)? That would make the system more equitable.

As for eliminating Social Security and replacing it with an individual account system, that would result in a windfall for Wall Street with an attendant lack of a secure retirement fund.

NORMAN ROOT

Montgomery Village

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Laurence J. Kotlikoff gives new meaning to the phrase "living in an ivory tower" with his contention that the "elderly who live off Social Security [won't] be hurt by having to pay higher sales taxes at the store."

The basis for his position is that Social Security benefits are adjusted annually for price increases. But as anyone who must to some degree rely on Social Security to meet living expenses knows, annual benefit increases are quite small and immediately rendered without value by increases in living expenses.

As night follows day, an increased benefit is followed by increases in the cost of Medicare and Medigap, rent, most services, food and clothing, etc.

Each sector of the economy seems to feel it alone is entitled to the fruits of the increased benefit. The needy recipient, meanwhile, is poorer with each benefit "increase."

DAVID POLLACK

Silver Spring