Which would you favor? If there were only ONE tax...

[UdoKier]

Poll question: Which would you favor? If there were only ONE tax...

Which would you favor?

If there were only ONE tax...

[Mizmoon]

1. could you add a quick definition?

I'm not really sure what a consumption tax is compared to a sales tax compared to a VAT ...

[faithfulcitizen]

65. me 2-difference btw flat consumption vs. flat sales?

anyone? :)

[AllegroRondo]

2. Income tax

but only if it includes ALL income, like dividends and interest on bonds, and at the same rate as wages.

[annabanana]

21. Bingo!................eom

[Ladyhawk]

3. A ten dollar tax for each poll UdoKier puts up. :D n/t

[UdoKier]

6. Dude...

The deficit would be wiped out in DAYS.
But wait a minute, who would pay it?

:dunce:

[demnan]

4. Give me back the Clinton economy

I don't mind paying taxes as long as I can make a fair wage.

[sam sarrha]

5. you need to tax based on disposable income.. i cant fix my car or buy

medication, i am disabled and my availability to work is limited.. i had a back injury and no one will hire me at jobs i can do because their Comp Carriers intimidate them not to hire me..

and DON'T say that is illegal.. they do it all the time. my friends that have businesses said that they told him he could hire me ..but if he did they would cancel all his present 17 policies and reschedule the payments.

and i pay more taxes than the richest 20 corporations and nearly all millionaires.

[Rainbowreflect]

7. I would like a consumption tax, but only one that excluded food

and medical. Considering the lower the income the higher the percentage is spent on those it seem more fair to me.

[AP]

25. A consumption tax would tax money you don't even recieve over a year...

...in which you do into debt (and that could guarantee that you'll never get out of debt).

It would be a money-maker for lenders because it would force you to borrow more than you would otherwise.

The bottom fifth of Americans have an average net wealth of negative 10k dollars, so that's a lot of people who'd be hurt by a consumption tax.

[M155Y_A1CH]

8. I vote flat tax

I'm for the flat sales tax but with a few exemptions.

The necessities of life such as
food, water and primary shelter should be exempt.

If you earn only enough to get by, you would pay no taxes
by nature of the exemptions.

If you have enough money to spend on anything else,
you would pay a flat percentage (to be argued over for decades).
I like 10% for now to help rebuild the "lock-boxes".

The more luxurious a purchase, the higher the price as well as the total tax bill.

This would work to assure that those who enjoy the finer things in life would indeed pay taxes on the money that they enjoy. No loopholes to it. Everything that costs money and is an asset is taxed at the point of sale.

[Ravy]

10. The problem with that is...

That current estimates would put such a tax at nearly 26 percent to maintain government funding. I think that would be if people would continue to spend at their current level, and this would be in addition to any state and local taxes you now pay. I am not sure that spending would stay the same under such an increase in cost of goods.

It is an incentive to spend more money overseas, if you are rich enough and so inclined.

Money that you have saved and already paid tax on would be taxed again.

Money in tax-deferred accounts like IRAs or tax-free accounts would be taxed if you spend them.

[M155Y_A1CH]

12. Not convinced

The figures that I've heard bantered about feature a lower tax than you say is necessary. If it were as high as you say I would still support a flat tax to promote fairness in taxation. If "life necessities" are exempted it is hard to argue that the tax burden would be too high to afford even at 26%.

I suspect we will all have to tighten our belts soon even without changes in the tax structure.

Also, why would overseas spending be exempt in your model? All purchases would be taxed. We declare purchases at the border as it is.

The tax may not always be collected at the point of purchase but would be required to be declared and paid in a timely manner.

Saved money would not be taxed until it is spent and there would be no capital gains penalty because the tax is on use not on gains. You would be then free to earn what you may with no tax hindrance. All savings would then be tax exempt.

I'm sure there would be some logistical problems with it, that is not my point. Those who receive the greatest benefit from being an American would pay the lions share of it's cost.

[AP]

26. See post 25.

Another problem with it is that your effective tax rate would decrease as the gap between what you make and what you spend increases. And who makes way more than they spend? Rich people.

This tax would shift the tax burden way way down the income ladder.

[M155Y_A1CH]

42. Let's talk about this

How can it shift to the lower income group with the exemptions I've mentioned? Indeed if all spending was taxed it would increase their burden proportionally. That is not what I suggested.

There seems to be a great big knee-jerk response to this issue. I just think that taxing folks income when they receive very little is a bit sadistic. That is what we do now as well as offering fabulous tax loopholes to the super-rich.

Better to assess taxes on those enjoying the greatest benefits of using money.

It would tax those who currently make money under the table. Dope dealers and gun runners would have to pay taxes when they use their profits. It would also reward savers who limit their spending.

Yes, goods would cost more but incomes would be higher as well.
I don't see a big rush to take out loans because income is not taxed so you receive more in your check and the absolute neccessities that take the biggest chunk of a modest income are not taxed. The biggest burden would be on the luxury item buyer, right where it should be.

People would limit their tax bill by limiting their own spending which is more easily adjusted than is their income.

[AP]

45. I'm not comfortable taxing people on anything that doesn't represent money

coming in.

The bottom 20% of Americans have a net worth of 10K dollars. So, it's possible that as many as 1/3rd of Americans have to borrow money year over year.

Even if you exempted a lot of "neccessities", when a person is in debt, it doesn't matter how much they already spent. It just matters that they're in debt. This applies to people with student loans and mortgages as well as to underemployed, undereducated renters.

So, once you've spent all the money you have for the month, ALL your purchases for the rest of the month are sending you into debt. Your watch breaks and you need a new watch. OK. You're spending money you don't have AND you're getting taxed on that money AND that tax is sending you deeper into debt. (Incidentally, the act of taxation is a huge gift to lenders -- it increases the amount you have to borrow.) It doesn't matter that 60% of your consumption was tax free that month; that watch was taxed and you were taxed on money you don't have.

Furthermore, most of the economy is dependant on selling people things, and a good chunk of that is the sale of things that are totally compulsory purchases. Increasing the cost of those items (and increasing people's indebtedness) decreases consumption, which is bad for the economy. People who don't make money from selling consumers things they wont wouldn't be hurt, but hard working, customer-satsifying businesses would be screwed.

And here's the math behind the insanity of a consumption tax.

If you make 10K bucks in America, we have a negative income tax. You actually get a tax credit. (Which I think is a great and fair thing). So, in this situation, your tax rate might be "negative" 20%. If you make 1 million dollars, your tax rate is about 35%.

Say you switch to a consumption tax. A person making 10K will almost either definitely be going into debt, or will at least be spending all the money they make.

So what tax rate do you want. The UK has an income tax and cap gains tax AND a sales tax of 17.5%, so let's say, for the sake of argument, that if the US got rid of the income tax, they'd at least need a 25% sales tax (which I still think is way too optimistic).

OK, so now if you make 10k a year, because some of your spending just became 25% more expensive you either need to decrease your consumption by, or you need to go into debt, which you didn't before if you used to break even, or you need to go into even more debt. Now, I know that people have this image that the poor are poor because of unwise spending decisions. But I think when you make 10K a year, you're pretty much spending only on what you have to spend on to live with a modicum of dignity. There isn't going to be a lot of elasticity in the choices you can make in your consumption. Anyway, say that 4,000 of your spending was on sales-taxable items. At 25%, you have a new tax burden of 1000 dollars. That's 10% of your income. That's a new effective tax rate of 10%. If you have to finance that year over year, you have a compounding tax burden -- you bascically have an income tax burden of infinity, since you're being taxed on money you don't even have.

Now let's look at the millionaire. Why are rich people rich? Because they make more than they spend (and even their consumption can be an investment -- a rich person can buy a rug, and painting, a watch, a car, a home, and silverwear, lamps, etc., that are worth as much or more after a year than they cost to buy them).

So, say a million-dollar earner spends 200,000 of his or her income on taxable items. At 25%, that's 50 thousand in taxes. So, where you've take the poor person from a -20% income tax to a 10% to infinity income tax, you've taken the million dollar earner from a 35% income tax rate down to a 5% tax rate.

Now, say that any one of those consumer goods for which the rich person paid 200,000 appreciates by 50,000 dollars over a period of time. Well, then that person eliminates the tax altogether. Now, how many items do 10K earners buy every year that have the chance of appreciating by 25% or more? I'll give you a clue. None. And how many things do million dollar earners buy that have a chance of appreciating? I'll give you a clue. Just about every consumer good you can think of has a luxury item equivalent that has a chance of appreciating in value (or at least, does not depreciate to zero the way the poor person equivalent depreciates to zero).

So, you see, a consumption tax is just a way to shif the tax burden off rich people and on to people who break even or live in debt and who can't afford to turn their consumption into investments.

[M155Y_A1CH]

93. My head just exploded

I am totaly interested in all of the points you brought up but now I am even more confused than when we started. You may be right about some of the things you said. I really looked into this issue many years ago and set my mind on it. I'm not entirely sure right now what convinced me. I don't think our tax code should penalize poor people or retirees. I do think the big wheeler dealers should pay the largest percentage to income. You made a point about debt, debt would not be taxed only spending. A larger amount of the debtors income would be in their pocket to apportion how to spend. If the debtor tightened his belt by purchasing only the nessecities to pay down his debt, no taxes would be incurred at all. Frugal spending is rewarded in the future and the debt would have been due anyway. BTW I currently happen to be one of the other "those", the bottom 20%. I think that alot of mystery surrounds this issue and there seem to be a set of talking points already in play. I am very interested in learning more about taxation and have only my intuition to go on and not an kind of expertise. It just seems the most logical way to slam it to the true benefactors. With exemptions it can be fair to all. The richer may even increase their spending because a 30% sales tax is a bargain compared to 50% income tax. It would get spred around instead of hoarded although the poor would have to live frugaly to avoid oppressive taxation, but the poor do that now. It keeps yaughts more affordable though to leave it as it is. I am concerned about the effects on retirement accounts and prior taxed income, perhaps a rebate could be applied for like filing taxes for the first decade or so to grandfather out the person's funds that have been taxed at a prior time. There of course would be details like that to iron out and perhaps social programs will need to be revamped but that comes with change of any sort. Do you really think that a flat sales tax is unworkable?

edit: sorry spell checkers not working and I'm a terrible speller.

[AP]

95. You wouldn't tax debt, only spending? Spending is what puts

you into debt.

How can you have a sales tax that you don't have to pay if you're in debt?

I know you think that people in debt should just spend less. But a lot of debtor's spending isn't discretionary. Ask people with student loans. Hell, ask students. They have no income and a ton of spending.

You should reread all these posts in this thread and rethink your support for a consumption tax.

[M155Y_A1CH]

100. I've lost you on this one

Debt is not the purchase that created the debt. It is an agreement to borrow money. The items or services purchased with money from the loan is taxed once at point of purchase, or not if exempt.. The loan would not be charged any tax. Only the purchases if you decide to use the borrowed money. Loan payments are not purchases and would not be taxed. That student with the loan would receive his full check for working, not the federal taxed version he receives now. Money spent on his loan or any loan would not be taxed any additional amount. As it stands he will be taxed on income before he even gets to make a loan payment. So in our current system, his school loans are taxed. With a flat sales tax he is only taxed when he pays tuition, if there is not an education exemption in place. I suspect we would exempt education costs to some degree if not entirely. The only way we would fail to get our revenues is if Americans suddenly stop buying nonessentials to the degree we currently do. Stuff would cost more on the face of it but incomes would be higher too. You would also receive all of your income each payday instead of having the tax withdrawn ahead of it's due date. If you earn 10,000 or under right now you have to give up the use of some of your money until after the end of the year when you receive your rebate. That weekly income taxation takes the money out of your hands for up to a year. At that income level you need all of your income for necessities but you can't get your hands on it until the government has had their use of it. You end up looking for work under the table or black marketeering opportunities which we are unable to tax at all. If you make your fortune this way, America is cut out of the loop and we get no taxes from you at all. You get to spend your illegal money on the legal market and still have no dues to pay.
A flat sales tax might hurt foreign tourism, maybe not because the dollar is already 25% lower than it's counterparts and dropping. Those that want to buy up America while it's cheap will currently face no federal taxation on the purchases. There is already so much inequity with our current system we could do better with any well thought out plan at this point. Necessary money is treated exactly as discretionary money and that is the beginning of unfairness. Setting a dollar income level for taxation is not fair because some folks with lots of children or elders to care for need a larger base amount to survive than a live at home teenager who works for pleasure money. It's only at the point of sale that we can sort them out and fine for pleasure and exempt for need. Income levels alone don't divide the haves from the have-nots it's what a person is able to do with that income that tells.

[AP]

111. Students have more expenses than income....

...which is why they're going into debt.

Of course there's no tax on a loan (and there's not tax on tuition, unless I'm grossly mistaken -- some states do tax some services). The place you're losing me is where you got the impression that that's what I was talking about.

Here's what I was talking about:

The debt you get into that I'm talking about is a purchase on your credit card. That purchase will have a HUGE tax component in your world. If you're already at break even or below, you're going to see your debt jump up just from the sales tax. And then you're going to have to pay interest on that. So if the sales tax is 26%, and your credit card charges you 20% interest, and you can't pay off your card for a year, you're actually paying 31.2% on that item thanks to the tax (and part of that is bank profit).

By the way, you get a child tax credit, which addresses your concern about large families.

You say income levels don't distinguish haves and have nots. (Actually, there's no better measure.) But even if, for the sake of argument, it weren't, consumption levels as a percentage of income has an even lower correlation to wealth. In fact, consumption as a % of income probably tends to have an inverse relationship to financial comfort. People are rich because they spend a fraction of what they make (and a lot of that is one things that maintain or increase value). Poor people are poor because they spend just about everything they make (and sometimes more). Taxing consumption lightens the burden for the rich and increases the burden on the poor.

Once again, if you make 500k a year, and spend 250K on taxable goods. You'd have to have a 60-70% sales tax to make up for the lost income tax revenue. Or, say you only have 15% federal sales tax on consumption, a million dollar earner would have to spend 1.5 million just to generate the same tax revenue. Do you expect them to do that?

[AP]

49. To repeat for emphasis: we don't tax the income of poor people. We have an

Earned Income Credit which is probably worth more than all the sales tax exemptions you want to give people. If you didn't have income tax, you wouldn't have an EIC.

[AP]

50. I thought we were going to talk?

It has been almost a half hour.

Another bad thing about consumption taxes even if they exclude 'neccessities' is that a millionaire could chose to only buy neccessities. That person could then avoid paying any tax at all.

[M155Y_A1CH]

70. Oops,hang on

Having ISP problems and am just now reading your posts.

[Ravy]

102. Do the math...

Currently about 12 percent of the first 85 someodd thousand dollars everyone earns goes in to Social Security (counting employer contributions). Without employer contributions, it is somewhere around 6 percent. So you are saying that an additional 4 percent on top of that will support the rest of the government?

What figures have you seen? Even the largest organization that promotes a flat tax (FairTax) uses the 26 pecent figure with SS figured in (I think they use 19 or so without it, which is the figure they most often spout--but you will still have payroll taxes in that model).

As far as the border goes, you declare what you bring back. Americans living abroad would not be subject to the tax. If you are suggesting that they have to document and submit tax on everything that they spend, I submit that this would be much more paperwork and problem for enforcement than we currently have.

How would you go about making savings exempt? I have money in my checking and savings accounts that I have paid taxes on now. If the new law goes into effect, am I to declare to the clerk at the 7-11 that the money I am using to pay for my purchase should be sales tax free since I have already paid the tax on it?

Saying you could live with a 10 percent flat tax should be a no-brainer. It is the GOVERNMENT that cannot live with that.

Please reconsider your position with more accurate percentages in mind and see if you still feel that way. Some do.

[imenja]

92. a flat tax favors the rich

and penalized the poor. That is it's purpose.

[ThorsHammer]

9. Much higher inheritance tax

I'd have a ceiling where a reasonable amount of money could be passed on, but amounts above that are taxed heavily. My rationale is that is more fair to tax heirs/heiresses who did not earn the money, than to tax (income tax) those who do work for their money. I don't think there's anything too terribly wrong with our current progressive system, but I would like to see inheritance taxes addressed.

[AllegroRondo]

11. Agreed

Back when congress was arguing about ending the inheritance tax, the Repubs pushed for a complete end to it, saying that it caused family farms to go bankrupt when the owner died. Democrats offered to up the exemption to the first 100 million dollars, but Repubs declined it.

[M155Y_A1CH]

14. Wouldn't that deter savings?

I mean why set anything aside for the future if it will just be lost that way? It's perhaps in our nature to try to advance future generations of our family. What do you value most if not you children's children? I don't fault those who save for the future instead of spending it all. I do envy those who receive a big inheritance though.

[ThorsHammer]

16. I think we actually agree (clarification below)

I'd put a reasonable limit such that the children's education, and the well-being of the spouse and children could be ensured. My problem is more with the massive amounts that are often handed down among the superrich, which creates a permanent class division. My idea would really target only a small percent of the population, as most people would probably be within the ceiling.

[M155Y_A1CH]

18. I do wish we could target "Those"

You know, the "haves"...

but I think the way to get them is when they spend the money to buy influence and other goods. Let them throw their new found wealth around and pay a flat sales tax for America.

If the basic necessities are exempted from the sales tax, food, shelter, water, could all be tax free for everyone.(poor included) The more you spend on non-necessities the more taxes you pay. An end to tax loopholes and no more percentage of income unfairness. Poor folks in our current tax hell are charged a much larger percentage of tax to income than others at the top of the income strata. If we shift from income taxing to spending taxing then those who spend the most on luxury and sin purchases would then pay the higher percentage of tax. Those only able to afford the basics would be untaxed entirely.

Let's tax them when they try to use it. A flat sales tax would also encourage savings. Interest would be untaxed as it is income. Only use of your money would incur taxation.

[CarpeVeritas]

37. terribly regressive.

a consumption tax will always be the most regressive.

what about quality of life issues- are the poor just supposed to do without entertainment? their kids without toys, etc.?

while the investor class can just keep getting richer.

Also(and this is the biggie)- if we switch to a consumption-based tax at this point, it will TOTALLY fuck-over older middle-class people who have saved for their retirement...they have saved and saved for years, money that has already been taxed as income- and now that they hoped to live on that money when they retire, they will have to pay huge taxes on every penny of that already-taxed once money that they spend.

a switch to a consumption tax will NEVER fly.

[M155Y_A1CH]

43. Straw men everywhere

We already have special programs for the poor and aged. Why would those cease to exist? Also with fair exemptions, money saved to live on wouldn't be taxed. Only money saved for nonessentials.

Taxes are due on IRAs when they are used right now. Retirement savings are tax deferred not tax free.

[AP]

47. Old people didn't save up all their lives to retire to a world where every

time they spent money on a non-essential they'd be carrying a disproportionately heavy part the tax burden relative to million-dollar earners spending only 20% of the income they make every year.

If my grandma wants to buy a 400 dollar TV on 10,000 in retirement income, she shouldn't have to pay 1% of her income in tax.

That's a 1% income tax on a SINGLE item, when, if we had income tax, she would have gotten a tax credit and money back fromt he government!

The lowest level of tax anyone pays in America is 10%. So my grandma would have gone 1/10th the way towards having the tax burden of entry level income-tax paying Americans today with ONE PURCHASE and no job! That's crazy.

[M155Y_A1CH]

101. Yes, indeed

On the other hand if she receives 10,001 dollars she will have to pay a 10% tax right now. That would hurt a lot more than being taxed only on non-exempt luxury purchases. At 10,000 per year she will not be buying too many TVs on which to be penalized. Her tax remains lower than what would have it been if she had earned one dollar more. Also her IRA withdrawls would not be taxed or penalized under a flat sales tax. She would pay only the tax on the TV.

[CarpeVeritas]

54. "only money saved for nonessentials"?

so it's ok with you if people who planned to enjoy retirement get fucked?

btw- not all retirement savings are in IRA's and other tax-deferred accounts. for instance- when people buy stocks, they usually do so with income that has already been taxed.

[sandnsea]

81. Savings?

Come on sweetie, people with cabillions of dollars don't get it by tucking away something for a rainy day. I think the current cap is $6 million. It probably still needs to be raised to protect mom/pop businesses. But a heavy inheritance tax on assets over $10-20 million wouldn't affect anybody who was setting aside money through savings.

[AP]

27. Inheritance should be taxed progressively according to income of recipient

That way, people would be encouraged to leave money to more people in lower tax brackets. Ie, they'd give it to people who needed it the most.

[Taxloss]

13. Could the five people who voted for a flat sales tax step up for a quick

lesson in social justice?

[M155Y_A1CH]

15. What would the lesson be?

Did you see my "life necessities" exemption?

[Taxloss]

23. Yes. Why do you feel the poor should only be allowed necessities?

And, beyond that, why do you feel the poor are the same as the rich?

[M155Y_A1CH]

24. We weren't talking about welfare n/t

You seem to be addressing how we are going to spend the money. The topic was how to raise it. Would you rather have the tax inequity we have now.

[Taxloss]

40. Flat taxes are inequitable. They treat rich and poor as alike.

They are not.

[M155Y_A1CH]

44. Yes, without any exemptions

We don't allow the taxation of food at this time. Why would'nt such exemptions continue?

[AP]

48. They're bad even though we have an exemption on food and they'd be worse

after you had to tripple or quadruple sales tax in order to cover all the income tax that was lost.

[Taxloss]

51. It's still inequitable, even with exemptions.

It may help the poor, but it helps the rich more. That is inequitable. The point of taxes is not to raise money, it is to redistribute money from those who do not need it to those who do need it. Also, flat "luxury" taxes would increase social inequality and "raise the bar" of privilege. Furthermore, they lock the economy into a counter-cyclical bind to consumer confidence; if people buy less (perhaps because they're being thrifty, which is good economic behaviour) the government earns less, and if it runs short, all it can do is raise taxes/prices, and people will buy less ...

All they do is help the rich get richer. The rich will just award themselves higher salaries to lessen the effects. The poor will be less able than ever to enjoy the privileges of the rich. Prices will rise to balance the economic effects. It's voodoo economics and it is NOT progressive.

[AP]

55. I agree with all of this.

One thing though: I think the purpose of the tax code isn't primarily the redistribution of wealth. I think the purpose of the tax code is to pay for infrastcture and pay other social costs in a way that (1) fairly burdens everyone paying in, and (2) reaps a great return on the investment.

A fair burden means that what you pay in vs what someone else pays in burdens you both equally -- therefore you have to take into account the fact that as you have more money, the value of another dollar decreases for you, and it increases the less money you have. So you can't charge people at both ends of the spectrum the same marginal rates on their income.

I think the reaping a great return part includes a component where you want to make sure that wealth gets distributed far down the income scale and broadly just because, as FDR taught us, rewarding work with wealth, and having a big, happy, wealthy middle class is a great way to make sure all of society is wealthier. So the tax code should definitely not be a vehicle for helping the wealthy concentrate wealth, while the poor have to bear all the burden. (Which is what a consumption tax so clearly does.)

[Taxloss]

58. Even the "paying for infrastructure" part is redistributive.

Imagine if the US didn't have a system of power stations and power lines. The wealthy individuals and businesses would be fine; they could pay for generators. The poor would be screwed. Electric power is a common benefit that tax helpd fund. Subsidised transport is the same - it benefits the poor far more than the rich. Most of the tax code is redistributive - socialist, in fact, a taking from those who are rich and a giving to those who are poor. As it should be.

[AP]

68. Yes, I agree with that -- I think the libertarian ideal would do exactly

that. Leaving everythign to the free market would concentrate a ton of wealth.

But I also think that even a tax code that is progressive, that doesn't burden wealth from work more than wealth from wealth, etc., will tend to concentrate wealth in the hands of people willing to work for it. I think that's what we saw even after TR's income tax and the inheritance tax: they all created an infranstructure-rich economy that built up the middle class, which gave big companies willing to compete and work for wealth a great deal of wealth.

Once they accumulated that wealth, then the government decided to make the tax code less progressive, and decided to shift the burden off people who have money and on to people trying to make money from their labors, etc.

I have to say that I don't really mind a tax code that rewards people and companies who work very hard with a great deal of (progressively taxed) wealth. What I mind is a tax code which starts helping them stay rich after they decide they don't want to work hard any more.

So I guess I see the tax code as a reward system as well, and not so much as a system that doesnt care how you got wealthy and which starts to redistribute your income once you get too much of it. Ie, I see it as even taking a little money from very wealthy people to provide the infrastructure to get even wealthier if they continue to work as hard as they did up to that point.

[Taxloss]

79. Taxation has nothing to do with reward.

Taxation is to do with an individual's obligation towards society. The "reward" of contributing more is the opportunity to live in a fair and just society where people aren't going to take away your wealth.

I'm not advocating punitive taxes, but it is absurd for high-earners to complain of a "greater burden" when their quality of life is vastly superior to low-earners.

[AP]

82. It is a system of incentives. We impose taxes in ways that encourage

certain behaviour (like home buying, saving, working, investing in innovation) -- or at least we should.

Clearly conservatives and liberals have different ideas about what incentives we should have.

However, when people engage in socially valuable, wealth-maximizing, tax code encouraged behaviours and get rich, I don't think it's the government's place to say, oops, you got too rich, so we're going to take that money away from you now.

A fair tax code that taxes wealth a little every place it changes hands, which doesn't reward accumulated wealth be rewards the earning of wealth is cool even if it produces very wealthy people. (And I think that you could probably tax the super wealthy an unburdensome amount and give very poor people and EIC so that everyone can live with dignity...)

[Taxloss]

88. Yes, it can be used as an incentive, but that is not its prime point.

Flat tax would simply channel money upwards. Just look at its supporters - the rich. Remember, they control, as a club, how much they are paid. They will simply increase their own pay to ameliorate the effect. The workers will be screwed, working harder, less able to achieve prosperity, and paying a rich man's salary.

A flat tax, with all the myriad exemptions people here are talking about, would not come close to providing enough money to fund government unless it was set extremely high. Bingo - you have, inequitably, divided America into two.

edited for typo

[AP]

90. I'm totally agains the flat tax.

This sub thread is about whether the purpose of the tax code is to redistribute wealth.

I say the purpose is mostly to pay for social investiments that create more social wealth in a way that is equally burdensome across all income ranges (and the way to equally burden people is through a progressive tax code).

Additionally, the tax code tries to create incentives for socially valuable behaviour and investments so that there is more social wealth to tax (and tax fairly and us "unburdensomely" as possible).

I also think downward and outward distiributions of wealth create the most wealth (I think that's the lesson of the New Deal), and I think that's big reason the deductibility of wages from corporate income tax is one of the biggest tax subsidies the government runs.

[Taxloss]

96. I agree, but that is still redistributive,

As it should be. It is the redirection of capital from the rich to create advantage for the poor. Or at least it should be. Incentivisation is a useful side effect, but negligible in revenue generation. And downward distribution demonstrably creates most wealth - It should be called redistribtion. The RWers who criticise redistribution do not see things like the tax cut and a flat tax as a redistribution, although they are - upwards.

[M155Y_A1CH]

104. Taxes pay for government

I can't see tax paying as a social program. Such programs may be funded by taxes but they are not the pupose of taxation alone. At least we found some grounds on which we can agree! I'll shut up about flat sales tax for now and we can get back to more likely issues elsewhere. It's not like the government is interested in a fair tax code anyway. I don't see any dramatic changes planned for the future and I'm sure they will resist spending any time on it until it's much to late for reform alone to make things more fair. Thanks for all your input, though. It has given me much to mull over.

Missy

[M155Y_A1CH]

99. Flat sales tax v flat income tax

The rich are for a flat income tax which would be grossly unfair to lower income groups. They would not like to see a flat sales tax that bills them when they use it. They want to keep the style of taxation as it is because there are so many ways to avoid paying their fair share, written right in it for them.

[AP]

108. The rich do want a flat sales tax (see post 110)

I never heard a thoughtful liberal argue for a flat sales tax. Mostly, I hear people who are confused and people who listen to RW radio and RW'ers argue for a sales tax.

[M155Y_A1CH]

74. It's true if...

If all income levels spent equal proportions of their income on the same types of things.

When you have to spend all of your income for food and housing you should not have to pay taxes.

There would have to be exemptions with any type of system. We have a progressive system now that taxes a larger percentage at higher income levels than at lower ones and rewards certain entities "for the greater good". That alone has not made for an entirely equitable situation. There is unfairness in any taxation type and amendments would have to be made to ensure no undue suffering. We wouldn't just wake up one morning and everything costs more. There could be credits etc... The application of it wouldn't be IRS free. Red tape would still prevail but the largest burden would eventually fall on the big spender.

[AP]

87. You haven't made the argument about what's unfair about a...

...progressive income tax.

[M155Y_A1CH]

105. Current progressive scale problem

If your income progresses one dollar into the next tax bracket you will be billed an additional 5% on all of your earnings. Where do you set the progressions in percentage of tax so that it would be more fair if you don't know how the individual will truely profit from that income? You have to use arbitrary cut off points to decide. A dollar to you may mean more or less to me.

[AP]

109. Oops. Missy, I've been polite so far. But I have to now say...

...part of your problem is that you don't understand how the tax code works.

Making one dollar of income into the next higher bracket means only that one dollar is taxed at the higher rate.

Where you set the brackets is going to be a little bit art and lot of math. Marginal rates have to reflect approximate marginal valuations of an additional dollar which will be function of how much things cost and how easy it is to make money when you're rich.

In the 50s, it was very easy to make more money if you had a lot of money, and things were cheap, so high rates on high levels of income made sense. And the revenue was used on public education (for the first time) and on building infrastructure, which meant there was even more wealth for the rich AND poor to go after.

In the early 60s, the math had changed. The economy leveled off, so it was time to lower those higher marginal rates. That kept the economy going up to about 72. But since then, marginal rates have born little resemblence to economic reality (and that's not saying they couldn't have been even more sensible before then -- I'm just saying they make no sense now).

[CarpeVeritas]

60. the point of taxes-

"...The point of taxes is not to raise money, it is to redistribute money from those who do not need it to those who do need it..."

ummmm...no-

the point of taxes is to raise the money that the government needs to meet it's obligations.

[Taxloss]

75. And what are those obligations?

The protection of the weak. That is redistribution. Imagine a world without taxes or government. The rich would still exist, and could afford bodyguards, private armies and their own resources. The poor would be screwed. The very point of government is the "collective good". Taxation is and should be redistributive. Take capital - in the form of money - from those who have capital and giving capital - in the form of infrastructure, security, civil society and so on - to those who don't. That is called CIVILISATION.

[faithfulcitizen]

67. but if the rich were taxed on *all* consumption...

without loopholes and "write-offs", couldn't they be paying more than they are now? I mean they consume A LOT...

[Taxloss]

76. The point is not the effect on the rich, but the effect on the poor.

Who cares about the rich? They'll be fine. Let's concentrate on the poor. A flat sales tax or consumption tax would NOT IMPACT the rich, because their control of the employment market would simply mean they direct more profit from private enterprise towards their own pockets. Executive salaries would SOAR in the first few months of a flat tax, I guarantee it, so the blue-collar guy, for whom the luxuries are now inaccessible, sees more of his labour leeched away by the ruling class. Meanwhile, the prosperity bar is raised.

That's not even counting the fact that flat spending taxes lock the economy to consumer confidence - you are building a boom-bust cycle.

[M155Y_A1CH]

103. What have we now?

All of the negatives you mention are in play right now. The only thing you didn't mention is how foreigners are able to buy us up without any federal tax penalty. With a sales tax they would pay for the use of America just like we do. With exemptions only for need, rich folks would actually have to pay taxes on the goods they enjoy. There would be no exemptions for the luxury items they are so want to buy. At this time many rich folks avoid their fair share of taxes by way of loopholes and credits that we at lower income levels can't make use of. If we could slam them when they use it, they couldn't hide it's existence in some dummy corporation or tax loophole. If they use it they pay and the rich will not stop buying everything they want just because it costs them more and those who could never afford such type of spending will not be penalized for buying food and modest shelter if life necessities are exempted.

[AP]

110. What are foreigners buying that isn't taxed?

We don't tax the purchase of stock and we're not going to start.

We tax retail sales, and foreigners don't need to buy anything American if they don't want to. Jack up taxes on consumer goods, they'll buy the goods abroad -- where they're manufactured (we make almost nothing in America that you can't get somewhere else).

The rich pay almost 1/3rd of their income in tax. Say they spend half their income (which is a very generous estimate of how much rich people spend). You'd need a 66% sales tax to make up for the lost tax revenue, and that's presuming they spend 100% of their income on items you're willing to tax.

So, you see why the rich would prefer a sales tax? It's because anything less than a 66% sales tax would constitue a tax cut for someone who spends half of their income every year.

[American Tragedy]

17. Progressive income tax.

Actually, I am convinced that is probably the only truly fair tax, and I would seek to raise the top tax rate.

Accordingly, I would try to abolish sales, excise, and other regressive taxes.

[yurbud]

19. public doesn't understand "progressive income tax" anymore

I tried to explain it to a college educated conservative friend, and he either couldn't get or refused to acknowledge it. He liked the idea of a flat tax better, so he would pay the same rate as a millionaire.

[CarpeVeritas]

32. that's cuz-

deep down, he just KNOWS that his day is soon coming, and he'll be the millionaire soon.

[mcscajun]

20. Progressive Tax, absolutely! And increase the maximum marginal rate!

A little history on the maximum rate:

During World War I the top rate rose to 77%; following the war, the top rate was scaled down (to a low of 20%):
1918 - 77%
1921 - 50%
1924 - 40%
1926 - 20%

Anyone see a familiar pattern from 1921 to 1926? Tax cut, after tax cut, after tax cut.

1929 - beginning of the Great Depression

1932 - a slew of excise taxes were enacted that year (on lubricating oil, malt syrup, brewer's wort, tires, toilet articles, furs, jewelry, automobiles, trucks, radio and phonograph equipment, refrigerators, sporting goods, cameras, firearms, matches, candy, chewing gum, soft drinks, and electricity.) The goods were either from non-favored industries or were considered "consumption by choice" items.

During the Great Depression and World War II, the top income tax rate rose, reaching 91% during the war; this top rate remained in effect until 1964.

1964 - the top rate was decreased to 70%, and then to 50% in 1981.

1986 - the top rate was reduced to 28%.

During the 1990s the top rate rose again, standing at 39.6% by the end of the decade.

2001 the top rate was cut to 35%.

I think we have some room here for a big increase in the highest marginal tax rate. Of course, the rich would vehemently disagree.

Consumption, VAT, whatever you want to call it...it's just another regressive shell game. Tax the rich especially, but tax everyone on All sources of income.

[ThorsHammer]

34. I'm not rich, but would not favor a big increase in the highest rate

Small raises are fine, but the 77% - 91% level is obscene. I'd rather go after unearned money - inheritance, dividends, etc.

[mcscajun]

77. I don't think anyone wants to see a return to 77%-91%...

...but we sure DO have some serious wiggle room here.

[oscar111]

35. cajun..what does "marginal" mean? confuses many:can you drop the word?

it sure confuses me.. and i do my tax returns all myself, dont recall seeing it anywhere in the booklet.

Ps super post! can you post a link to source with all the top rates in it? over time.

[mcscajun]

83. Marginal vs. effective

The rate of tax you are paying on your highest dollars of income is called your marginal tax rate (or what people commonly refer to as their "tax bracket"). The rate of tax you pay on all of your income combined is the effective tax rate. So when people talk about being in a 35% tax bracket, this doesn't mean they pay 35% tax on all their income, but only on the portion of that income falling in the 35% 'bracket'.

The effective tax rate is the blend of the various tax rates as your income increases; that is, a portion of your income gets taxed at the lower rate, the next portion at a higher rate, and the amount over that at the maximum rate. So when someone (like me) suggests increasing the maximum marginal tax rate, we're talking about increasing the tax rate payable against all income over a certain maximum amount.

I hope that clears it up. :)

[mcscajun]

86. Links

links:

http://en.wikipedia.org/wiki/Income_tax#History_of_income_tax_in_the_USA

http://www.infoplease.com/ipa/A0005921.html

http://www.taxhistory.org/

[CarpeVeritas]

22. no estate tax?

[AP]

28. See post 27 - estate tax should be folded into progressive income tax.

[CarpeVeritas]

31. in that case- a progressive income tax, or a flat tax that exempted-

the first $25,000-30,000 for an individual, or $50,000-60,000 for a couple(hetero or homo)...and counted ALL income equally(i.e. cap gains = wages).

[AP]

46. Flat taxes are bad.

Taxes should be equally burdensone regardless of total wealth.

Wealth is a function of how much money you already have.

A flat tax ignores that fact.

If you have less money, each dollar you have is way more valuable, so to tax that dollar at the same rate that you tax a dollar in income for someone who has many dollars is actually to burden the poor person way way more than the rich person.

And this is true at any two points on the income scale.

It's ridiculously unfair to tax a person making 10K a year the same as a person making 75K a year. It's also ridiculous to tax someone who makes 1 million a year the same on their next dollar in income as you tax someone making 10 million or 100 million.

[CarpeVeritas]

52. you need to reed more fully before posting...

"It's ridiculously unfair to tax a person making 10K a year the same as a person making 75K a year..."

that's why i qualified the flat-tax by saying that it should exempt the first $25,000-30,000 per person, or $50,000-60,000 per couple.
and those numbers are just off the top of my head. before i could actually get behind something like that, i'd have to see how the numbers work out.

but i agree- a straight flat tax would be extremely regressive.

[AP]

53. It's ridiculously unfair to tax a person making $30,001 the same rate on

their next 1000 in income that you charge a person making 50,000 or 500k or 50 million a year.

I was using 10k because I used that number in an example up above already. I was referring to my own argument.

I thought about using your numbers for a second when I wrote that, but I thought you'd understand what I was talking about so I wasn't worried, and I was hoping Mi55y would read it and bells would ring in her head.

So, I wouldn't exactly say, "you need to read the entire thread more closely." But I might say, "hey, calm down."

[CarpeVeritas]

56. there's always going to be huge inequities in income...

why is it "ridiculously unfair" to charge the same rate on income above a certain pre-determined amount?

btw- the person in your example, making $30,001 would only be paying taxes on $1 of income- even if the flat tax rate were 100%, they'd only pay $1.00- but apparently you feel that it would be a "ridiculously unfair" amount?


huh?

[AP]

64. The answer to your questions are elsewhere in this thread, but I'll

try to make them clearer all in one spot.

Equalizing the burden of the tax code at all income levels means the tax rate has to reflect people's valuation of an additional dollar (or 100 dollars or 1,000 dollars) in income.

What influences how much value you have on a dollar of income? How many dollars you already have.

If you have 10,000 dollars, what would you do for another 1,000 dollars? Probably a lot. You would work hard and for a long time to get it, right? What would you do if you had 100,000 dollars to get another 1,000 dollars? Depending on your job, you might simply spend a weekend at work. What if you had a million dollars, how much trouble would you go to for another 1,000 dollars? You might call your broker and tell him to put 50,000 into treasury bills, or a non-risk muni bond, or something like that. You certainly would go get a second job and work nights for 3 months.

So, how is it fair to charge all three of those people the same exact rate for that extra 1,000 bucks in income? If you take away 330 dollars from each of those people, you're hurting the 10,000 earner way way more -- If it took that person three months of a second shift to get that extra income, you made that person work for a whole month just to pay the taxes on the income. For the 100,000 earner, it only too about 5 hours to work to pay the tax, and for the rich guy, he didn't have to do muc of anything to pay the tax.

Now, obviously, it's just easier to make more money if you have a lot of money. The millionaire might have to work overtime for three months to increase her earnings by 10% (which is what the poor person had to do), but probably not. And that presumes that a person with that much money is willing to sacrifice even more time for such little increases in wealth (compared to the poor person who might have to do that just to live with a modicum of dignity).

So, the tax code has to take into account those different valuations, or it would be burdening poor people more than rich. And when you allocate burdens unfairly, what you're really doing is relegating some people to poverty, and relegating others to wealth no matter how hard the first works and no matter how little the rich person works.

Our society is built on work and you don't want to turn it into one where the poor are not rewared fairly for their efforts, and you don't want to have rich people have a disincentive to doing productive labor (why work to get rich when you can live off the backs of the poor?). That's what happened in Europe up to the late 1800s, and it doesnt' work. The societies that reward labor will always beat out the ones that just reward wealth, and right now the EU and South America are ready to step up and form societies that reward labor, rather than wealth, and the US will be screwed if we have a flat tax code while everyone else is rewarding work.

Now, back to the fat exemptions. I don't have a huge problem with them, but if you want to be technical, you have to ask your self, "what's the big difference between 29,000 and 31,000 that results in the fat tax bill for the the 31,000 earner on her last 1,000 in income but not tax on the 29,000 earners next 1,000? What happens at that threshold that burdens the 30-31K earner?

And also why, do you want to screw the 31K earner so much more not just relative to the 0-30k earners, but also to the million dollar and more earners? Anywyere you put that exemption, it's going to be least fair to the people just above it, and most advanatageous to the people below it (and far above it), so you better have a good reason for making such sharp distinctions between the valuation of a dollar for people in such similar situations.

I like the EIC, which is an income sensitive credit. So, just so that all the math works, I think that what the US should do is have a 0 point -- if you say you don't have to pay tax until you make 30k, I think that that better be the threshold at which, if you make, less, you're getting a tax credit.

Personally, I suspect a sensible 0 point would by about 17.5. The more under that that you make, the bigger your EIC is. Above 17.5, the brackets could start as low as 2% on the first 10k, 4% on the next 25k, 7% on the next 40k, 9.5% on the next 85k, 11.75% on the next 100k, 18% on the next 400k, 25% on the next 1 million, 27.5% on the next 5 million, etc....

Or whatever. Dicsuss.

[CarpeVeritas]

71. you just don't get it....

"what's the big difference between 29,000 and 31,000 that results in the fat tax bill for the the 31,000 earner on her last 1,000 in income but not tax on the 29,000 earners next 1,000? What happens at that threshold that burdens the 30-31K earner?"

I wouldn't exactly call a tax on only $1000 of $31,000 of income a "fat" tax bill- why do you?

what happens at the $30,000 threshold that burdens the 30-31k earner?
well, again, i wouldn't call a tax on $1000 of a $31,000 of income a "burden"- but what happened at that threshold is that they made $1000 more than the pre-determined exempition amount, whereas the $29,000 eaner didn't...see? it's pretty straightforward.

and since you don't seem to care for a graduated scale of exemptions, our current system must REALLY irk you, with the way it screws people for making even an extra $1 at 4 different income levels.

[AP]

78. That's sort of rude. But I'll try this again.

A flat income tax that starts at X income will always be least fair to the person at X+Y income level compared to X-Y and X+10Y or X+100Y.

No, tax on 1000 dollars of income over 31K doesn't sound burdensome, when that's all your looking at. But that's not the whole picture.

Compare the tax on that 1000 dollars to the tax on a 29K earner, or 40K earner or a 130K earner, and it isn't fair for the reasons I've stated elsewhere: ie, that your value of a dollar of income depends on how many dollars you have.

A 31K earner doesn't have a radically different valuation of a dollar compared to a 29K earner, and definitely values a dollar more than a 40K or 130K or 1 mil earner. A flat tax on all those people's additional dollars burdens the 31K earner the most.

The tax code should care about those different valuations much more.

I'm not sure what your last paragraph means. It irks me that there are only four bracktets. There should be many many more to reflect the sliding scale of different valuations of an additional dollar across the very broad range of incomes in America.

And what's a "graduated scale of exemptions"? What you propose is one single exemption after which tax starts. To repeat what I said, I think there should be a graduated EIC which decreases to 0 and then a graduated income tax which builds up from 0.

[AP]

98. How should I interpret the silence?

Do you understand what I'm saying now?

[JanMichael]

29. I may have missed it, but what about a "WEALTH TAX"?

Hell, if I don't work, I don't eat...Why not level this fucking field?

[oscar111]

36. 105 trillion is US wealth

http://www.federalreserve.gov/releases/z1/current/accessible/l5.htm

see bottom line

i see software chopped off the url's end, so here it is again...

current/accessible/l5.htm

where l5 is "L" 5, not I5. nor fifteen.

[leftofthedial]

30. an annual tax on one's net worth

would seem to work well.

[CarpeVeritas]

33. the problem with that-

how do you determine your "net worth"? who determines the value of assets?

with an INCOME tax, you're taxing something that's much easier to track.

[BoogDoc7]

38. My take...

I'm a flat tax fan, or a consumption tax fan but there's a few points about what would happen. I also dislike any taxation that taxes someone on money already taxed (just a principle I dislike).

It simplifies the tax system; that means that it puts accountants and related jobs out of work...jobs which actually add little to no value to an actual product. This means a DROP in consumer prices overall. Probably not as much as the actual increase in profit (companies would definitely not drop them as much as that), but prices would drop.

Also decreases the need for the IRS, or at least at that level. Losing a government agency is not necessarily a bad thing (frankly, I think that ALL government agencies should be restructured from the ground up, and that government employees should be on merit pay structure and the ability to hire and fire employees made greater.)

[CarpeVeritas]

39. regarding the consumption tax and money that's already taxed...

switching to a consumption-based tax system would totally screw a lot of people who have saved for their retirement...they have had their income taxed as they earned it, and now that they plan to use it to enjoy their retirement, they will be taxed again on every penny they spend(other than possibly necessities).
don't look for a lot of support for a consumption task among the older half of the population.

[AP]

94. Money should be taxed when it changes hands. The problem

isn't that it has been taxed before. The problem is that it's getting taxed disproporitionately compared to other demographics.

We should not have a tax code that burdens low income people who go into debt 40 times more than millionaires who spend less than 10% of their income.

[AP]

41. Another problems is that you could pay tax on shrinking assets and the tax

would tax you into oblivion faster even though you're suffering from bad economic luck.

We really should be taxing money everywhere where it changes hands just a little, and we should be taxing the accumulation of wealth (ie, the gov't should participate a little in people's winnings -- not their losings -- in exchange for the help the government provides people which allows them to win). The gov't shouldn't get a cut when they can't help people accumulate wealth. There'd be less of an incentive for the goverment to provide a good economy in that situation.

However, given that so many people have been accumulating huge amounts of wealth thanks to a tax code which looks the other way, it may be neccessary to have a one-time wealth tax on very high levels of income just to capture back all the stuff we've been ignoring the last 30 years.

Now, having said all that, I do think property taxes have their place in the tax code (that are fair, and cover all property -- ie, no business property exemptions, and no Prop 13 style taxes where property values are based on the price on sale so that people who never sell their property pay very low property taxes). Property tax is essentially a wealth tax on the value of your property.

Land, along with labor, is the root of wealth in a functioning economy. If people didn't have to pay a property tax, very wealthy people would buy up tons of property and would have no incentive to put it to productive use. So, for example, if you had 1 million dollars worth of property taxed at 2% every year, if you didn't want to lose money you'd either have to hope that it was appreciating at more than that rate, or you'd have to do somethign with the land that was economically (and therefore socially) productive. You'd have to grow food on it that was worth more than 20,000 per year (or even more to cover to income and, if you sell directly to the public, sales tax). With residential property, it encourages you to make improvements to your home -- but I do think residential property should get a property tax break.

[CarpeVeritas]

57. all reasons why having just ONE tax would never work.

[AP]

69. Gotta tax money a little everywhere where it changes hands.

If you don't, people who can deterimine how they can transfer wealth will use that one method to transfer it tax free.

[leftofthedial]

106. but that penalizes work.

capitalism should be taxed. hoarding treasure is not a productive pursuit.

"easy" is not at issue.

You calculate net worth with a sytematic definition and formulas, just like you caclulate the (often) equally nebulous construct, "income," now.

[leftofthedial]

107. certain kinds and/or amounts of savings might be exempt.

or there might be thresholds that rise with a person's age as they save for retirement.

I also favor an estate tax. When one dies, there should be reasonable caps on what may be passed on to one's heirs tax free.

[bobweaver]

59. Property tax, because property owners are the ones with the biggest stake

[CarpeVeritas]

61. works for me....

i can pass the costs on to my tenants in the form of higher rent.

[bobweaver]

62. With nationwide rent control, of course.

[CarpeVeritas]

63. LOTS of leases wouldn't be renewed...

LOTS of property would go into disrepair.

LOTS of buildings would burn down for the insurance.

[bobweaver]

73. Thus the land would eventually return to its proper natural condition.

[sandnsea]

84. Low-income rental rebates

That'll take care of that. :)

[enki23]

66. none of the above

a very progressive, very high percentage capital gains tax.

[CarpeVeritas]

72. personally, i think all income should be treated the same...

capital gains = wages = inheiritance, etc.

a high percentage cap gains tax would keep people from investing, and jobs would be even harder to come by.

[sandnsea]

85. lol, bullshit

People are not going to stop putting their capital work, no matter the tax. Past tax rates are proof of that.

Laying around by the pool and collecting a check does not equal the income derived from labor and the fact that 90% of Americans must labor in order to even eat. You've got your priorities screwed up, BIG TIME.

[blurp]

80. A tax on assets. Even your own body.

The more you have, the more you pay to protect it. The bigger your house, the bigger the tax. The more stock you own, the bigger the tax, etc.

And yes, even a tax on the economic value of your body.

Bizzare? Maybe. But consider this, someone physically disabled pays nothing. Children of course pay nothing. The eldarly pay nothing.

[SharonAnn]

89. A flat Wealth and Asset tax. He who has most should pay most.

You've completely left out taxes based on assets.

The truly wealthy can just structure their assets so that they have very little "income" and thus avoid an income tax.

They can structure their spending (have corporations or trusts do the buying) and thus avoid sales taxes.

I think the right answer is always a combination of the three types.
1. Income tax
2. Sales tax
3. Property (wealth) tax

[imenja]

91. What is the difference between 2, 3 and 3?

They are all consumption taxes, aren't they?

[Kablooie]

97. The TEA TAX! We need higher taxes on tea. nt