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Old 10-29-2004, 02:12 PM   #41 (permalink)
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Quote:
Originally Posted by braisler
If you remove that tax burden, the corporation could potentially bring the same product to market at a lower price point. Instead of paying $100 + 6% sales tax for a total of $106, you might pay $80 + 35% sales tax for a total of $108. Not withstanding that current sales tax is locally collected and used by the states, I think that you can see how this situation might work.
Thanks for that example, I believe it proves my point that there's no point in doing that. In your example, the retail price of DVD player is less because the corp. didn't have to pay any taxes. However, the actual amount paid is baiscally the same (by adding a 35% VAT). Now this 35% VAT ONLY accounts for the amount of money that used to be collected directly from corporations. It doesn't touch the income tax money. It also would only apply to VAT taxable items. Therefore it would need to be even higher to cover the income taxes that used to be collected from corps that make non-VAT taxable items.

In order to completely switch to VAT we'd also have increase the VAT more to cover that money. Also, since most people spend most of their money on non-VAT taxable items we have to make it even higher. Before you know it, we are charging over 70% on VAT items.

Quote:
Originally Posted by braisler
Further your argument that a larger sales tax would discourage consumption would be the equivalent to arguing that increasing income tax discourages people from working. If I have to pay tax on any income I have from working, then I am going to work the least I have to in order to survive. That would reduce my tax! Sounds silly? People always want things to make their lives more comfortable and pleasant. An increase in the sales tax is not going to keep your neighbor from buying that bike for his kid.
The problem with the arguement that income tax discourages working is the fact that you need to work if you want a house, food, electricity, etc. You don't *need* to see movies and buy shit. Sure, there is welfare but that barely gives you enough to live in a shithole. Consumption is a choice that can be easily reduced.

Furthermore, what about buying a car? Say there is this $20k car. With a 70% VAT on there it's up to 34k. You have to pay interest on the VAT! Fuck that.
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Old 10-29-2004, 03:42 PM   #42 (permalink)
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Quote:
Originally Posted by kutulu
Before we even talk about revising the method of collecting taxes we need to figure out how much money the government needs to collect via taxes. We cannot keep piling on debt. It's not fair to the future generations. If we shift to a different system we need to know without a doubt what those rates will be and that those rates will provide the govt with sufficient income.
I agree. Government is way to big.
I wonder how we Americans would react if we really knew how much taxes we pay. Imagine if there was only a sales tax and that loaf of bread was marked 25 cents but when you got to the checkout counter they added $1.80 in taxes instead of taking it out at every step of production like we do now. (figures are for illustration purposes, I still don't know how much of the price is due to taxes, I'm guessing it's a large percentage)
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Old 11-28-2004, 01:18 AM   #43 (permalink)
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Quote:
Originally Posted by aceventura3
Your method seems to be a compromise type solution. I think one weakness is that there are people who would pay no taxes. I think everyone, no matter how small the amount, make some contribution in taxes to support the government.
I do know their is a weakness to my system. However, our current system allows for people to get away with not paying taxes, and it is not as fair. Our current system estimates 20-25% will cheat or not pay all they 'owe.'

I want to revise my system a little. Dependancy rates would be regressive. One dependant would get about an additional $10,000 tax free, instead of $13,000. A second dependant would be an additional $8,000 or so. So a family of three would get $31,000 of their income to be left un-taxed instead of $36,000.

As for a VAT or sales tax, I like it because people only pay when they spend, hopefully encouraging saving, but unfortunately low income households are punished because it is harder for them to save. One solution might be to not tax necessity items like food.
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Last edited by madsenj37; 11-28-2004 at 01:22 AM..
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Old 11-28-2004, 11:42 AM   #44 (permalink)
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Quote:
Originally Posted by Superbelt
Poor top 5% paying in 53.25% of their income in taxes.
I'd shed a tear for them if it wasn't for the fact that they pay a SMALLER percentage of their income into the federal government than I do with my 28K a year job.
So how much of other people's money should wind up in your pocket before things are "fair?"

Quote:
Originally Posted by Superbelt
Top 5% paying 53% but control 57%. That's a damned good deal by any account.
If you're talking about a "good deal," how about the EIC?

The illegal Guatemalans that used to live near me had about eight people in the same house receiving government assistance.

That beats the hell out of the deal you think is so sweet.
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