http//news.yahoo.com/news?tmpl=story&u=/ap/20050303/ap_on_bi_ge/greenspan_20
Not sure about this one ,surly the lower income group would not spend so much on * possesions * so they would be less likely to pay a lot of tax ,expecially if food , and clothing where excempt ??
help me decide ???
A flat sale tax is always going to screw the poor. They will end up paying a much larger percentage of their income to taxes than the rich. It's the classic regressive tax (as opposed to progressive -- like income taxes, where the rate of tax increases as you earn more).
Think of it this way,
say someone earns on $20K. Pretty much all of that is going to go on consumables and getting by. Let's say the tax rate is 10%. That guy pays $2K in taxes. 10% of his income.
now think of the guy earning $1M. No way that whole $1M goes on consumbales. Let's say he spends $100K a year on consumables. He pays 10% on that, so $10,000. But thats only 1% of his income.
Short version, in any scenario, a regressive tax means the poorer you are the more chunk of your income goes to taxes, the richer you are the smaller the chunk goes to taxes. Which is the whole point for the advocates the flat tax (almost always on the right wing), as they argue Richy Rich will sling more of that excess dosh into investments and the market will grow and the economy take off, which will trickle down the the poor people . . .
If you buy that argument, you should be for it. If you don't you're against it. I don't buy it, by the way.
It is also anti family - as families will alway consume more than individuals. Which is probably why it is so popular with Conservatives, who only pretend to like families so as to legitimise their homophobia.
VAT in the UK is designed not to be harmful to the poor, with the various zero ratings. Of course, DVD players and designer trainers attract the full rate...
You could always stick it on luxury goods, and leave stuff such as food and clothes alone...?
You could always stick it on luxury goods, and leave stuff such as food and clothes alone...?
You could, but if you restricted it to true luxury goods it probably wouldn't raise enough revenue.
Thats before you get to the real issue - define "luxury".
In Britain V.A.T. applies only to non-essential goods. ask any woman how 'non-essential' tampons are?
You could always stick it on luxury goods, and leave stuff such as food and clothes alone...?
You could, but if you restricted it to true luxury goods it probably wouldn't raise enough revenue.
Thats before you get to the real issue - define "luxury".
In Britain V.A.T. applies only to non-essential goods. ask any woman how 'non-essential' tampons are?
But surly ROB arnt tampons and other like goods NON VAT taxable its been a long time since I bought anything in UK and i dont use tampons . :)
The point about the tax being on all items and not just (luxury item ) would of course affect the poor more as they spend almost 100 of there income on day to day living expenses , i was thinking on the lines of excluding food and everyday living expenses ,but as you point out that would not raise enought revenue .
There is also a plan being discussed in oregon i think ??? of replacing all auto taxation with a tax on milege used ,i bet that also falls into your belief that the poor would suffer unfairly ???? .
Like S/S the Tax system needs revamping but as of yet im not sure which way i would like to see them change .
:)
[quote="Rob S"
You could, but if you restricted it to true luxury goods it probably wouldn't raise enough revenue.
Thats before you get to the real issue - define "luxury".
[/quote]
Thats another long thread issue to me.
Whats luxury to a person living in a tent 4 walls are a luxury ,to an executive a nice leather and gold adorned limosine isnt .
True. I think Greenspan has developed a habit of looking at things in a purely financial sense devoid of any compassion.
I think tax overhaul needs to focus mainly on people (particularly the rich) weaseling out of paying tax via questionable deductions and tax credits because they can afford the accountants that know about such things.
True. I think Greenspan has developed a habit of looking at things in a purely financial sense devoid of any compassion.
I think tax overhaul needs to focus mainly on people (particularly the rich) weaseling out of paying tax via questionable deductions and tax credits because they can afford the accountants that know about such things.
OOOOH YES!
There is a whole huge can of worms waiting to be opened here; but unfortunately when you have a Senate and an Executive full of millionaires there is really not much incentive for them to do anything.
And it goes beyond deductions and credits to trusts, estate, shell companies and offshore activities.
Added in to that is a system with in the IRS that penalizes staff who conduct audits and find nothing - thus acting as a deterrent to auditing anyone who can afford good lawyers and accountants and the fact that there are only a tiny number of auditors in the first place.
Just getting people to pay what they should would bite a huge chunk out of the deficit or alternatively pay for Universal Healthcare.
There is also a plan being discussed in oregon i think ??? of replacing all auto taxation with a tax on milege used ,i bet that also falls into your belief that the poor would suffer unfairly ???? .
Why not just increase tax on gas? Maybe we could even encourage more fuel efficient vehicles at the same time?!
Makes you sick. Meanwhile the middle class gets screwed as usual.
OOOOH YES!
There is a whole huge can of worms waiting to be opened here; but unfortunately when you have a Senate and an Executive full of millionaires there is really not much incentive for them to do anything.
And it goes beyond deductions and credits to trusts, estate, shell companies and offshore activities.
Added in to that is a system with in the IRS that penalizes staff who conduct audits and find nothing - thus acting as a deterrent to auditing anyone who can afford good lawyers and accountants and the fact that there are only a tiny number of auditors in the first place.
Just getting people to pay what they should would bite a huge chunk out of the deficit or alternatively pay for Universal Healthcare.
You could always stick it on luxury goods, and leave stuff such as food and clothes alone...?
You could, but if you restricted it to true luxury goods it probably wouldn't raise enough revenue.
Thats before you get to the real issue - define "luxury".
In Britain V.A.T. applies only to non-essential goods. ask any woman how 'non-essential' tampons are?
But surly ROB arnt tampons and other like goods NON VAT taxable its been a long time since I bought anything in UK and i dont use tampons . :)
The point about the tax being on all items and not just (luxury item ) would of course affect the poor more as they spend almost 100 of there income on day to day living expenses , i was thinking on the lines of excluding food and everyday living expenses ,but as you point out that would not raise enought revenue .
There is also a plan being discussed in oregon i think ??? of replacing all auto taxation with a tax on milege used ,i bet that also falls into your belief that the poor would suffer unfairly ???? .
Like S/S the Tax system needs revamping but as of yet im not sure which way i would like to see them change .
:)
V.A.T. famously applies to tampons, and to other things which one would not immediately define as 'non-essential' (adult cloting for example). It is of note that V.A.T. expanded both in the number of items covered and the rate, under Margaret Thatcher - who most remember for cutting taxes (the tax burden actually went up - but there are various reasons for that, some of which apply also to the Blair administration).
However this gives a flavour of what Greenspan et al would like to see here. IMHO it is a bad idea both socially and economically - particularly when there is such a huge deficit.
As to the gas/milage tax - Adeshell has it right - just increase the gas tax - it would benefit the environment, national security and increase short-term revenues (long term people would buy more efficient vehicles and use public transportation).
Contrary to conventional wisdom - taxation is a wonderful thing :wink:
Sadly, the Oregon mileage tax idea came from a building not too far away from where I sit right now (
Dumb idea, dreamed up by academics who clearly don't understand the difference between a hybrid and a Hummer.
To be honest, they are working for the state, to find a way to keep the income up when gas tax income drops (as people buy more fuel efficient cars).
No one seems to have spotted that vehicle (road) tax here is laughably low. I pay about $35 a year and that is for personalised plates as well.
True. I think Greenspan has developed a habit of looking at things in a purely financial sense devoid of any compassion.
Welcome to Milton Friedman's Wonderful World of Free Market Economics.