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Does anyone understand why we need both sales tax and income tax? That never made any sense to me.
by moultano 16y ago
Does anyone understand why we need both sales tax and income tax? That never made any sense to me.
- btilly 16y agoMany (most?) states don't have both. They only have one or the other. At least one state (New Hampshire) has neither. Instead they have little government, high license fees, and the state runs the liquor stores at a profit. (Said stores sell liquor much cheaper than surrounding states. NH takes advantage of this by putting big stores right on the Interstate as close to Boston as they can.)
- jonknee 16y agoHardly. States without income tax: Alaska, New Hampshire, Tennessee, Florida, South Dakota, Washington, Nevada, Texas, Wyoming. States without sales tax: Alaska, Delaware, Montana, New Hampshire and Oregon So just two states--Alaska and New Hampshire--have neither, while most have both. By population it's even more apparent as AK/NH/SD/WY/DE/MT have almost no population (about 5 million combined or less than the size of metro Houston).
- btilly 16y agoI stand corrected.
- jbooth 16y agoNew Hampshire also has very high property taxes. You can't balance a budget on liquor store proceeds. (Alaska has the oil thing). 5.3% income tax (MA) vs 5-6k higher property tax bill means, unless you're making over 100k (much less common in NH than SF or NYC), then NH is a higher-tax place to live. This is in contradiction to what 80% of people who live in the area will tell you, but they're all wrong, these are the numbers.
- btilly 16y agoWhen I lived in NH most of the property tax bill went to the local government for things like schools, and not the state. According to http://en.wikipedia.org/wiki/New_Hampshire#Economy http://en.wikipedia.org/wiki/New_Hampshire#Economy Overall, New Hampshire remains ranked 49th among states in combined average state and local tax burden. This suggests that the locals actually are correct.
- jbooth 16y agoWhen you lived in NH, the state was redistributing some of that property tax to poorer municipalities due to a NH state supreme court case that happened around 10-20 years ago. And, like I said, if you weren't making a lot of money you were probably getting a bum rap compared to income tax as far as how much you had to pay relative to the total tax take. Property taxes are regressive unless you have a sweetheart landlord. I was talking about southern NH where the property values are high and everything else is comparable to Massachusetts - between northern MA and southern NH you're talking a 5-6k real estate tax bump for the average home. In the boonies you pay less property tax because your town is getting it from Nashua. They do have a lightweight state gov't, but it still costs money to run the various services in every town. If you want to live somewhere very isolated and not pay for services you're not getting, though, northern NH is your place. EDIT: Ugh! Clicked through to wikipedia. What's the cite? "The Tax Foundation". It doesn't even mention property taxes, just state taxes, and no indication as to how they produced the number. Their PDF is 1 page. Think tanks are fun! http://www.taxfoundation.org/taxdata/show/468.html http://www.taxfoundation.org/taxdata/show/468.html
- btilly 16y agoWhich court case? Based on a quick search I suspect you're talking about http://www.courts.state.nh.us/supreme/opinions/1997/school.htm http://www.courts.state.nh.us/supreme/opinions/1997/school.h... which demanded changes that happened a couple of years later as seen in http://www.courts.state.nh.us/supreme/opinions/1999/clarprac.htm http://www.courts.state.nh.us/supreme/opinions/1999/clarprac... with some back and forth. From which I conclude that when I lived there the state was NOT redistributing that money since I lived in NH from 1992 through 1998. As for where I lived, in Hanover the property values are not very high. (Locally they are somewhat higher because of Dartmouth College, but are still not that high.)
- BrandonM 16y agoI think that a big part of it is that if we saw the 50%+ we actually pay in taxes * all at once, we would realize how little value we're getting in comparison to those "socialist" countries in Europe (and Canada) where they don't pay much more but get much better services. * When you factor in gas taxes, sin taxes, vehicle registrations, etc., as well as sales and income tax
- moultano 16y agoGas taxes, vehicle registration fees etc, actually make a lot of sense to me. Ideally it would be great if we could fund our roads entirely with gas taxes to internalize their cost.
- vaksel 16y agowe could if we charged the same $4-6 bucks per gallon that it costs in pretty much any other country
- btilly 16y agoFrom what I've read the biggest reason for Canada's higher tax rate is that they run a balanced budget. If the USA were to balance its budget by raising taxes, it would also suddenly have a much higher tax rate.
- anamax 16y agoActually, US govt spending per person was comparable to Canada's. (US govt spending is growing.) US govt tax collection as a fraction of GDP doesn't bounce around all that much, independent of rates.
- btilly 16y agoThat is another way of saying the same thing. The two countries spend about the same. Canada is actually balancing its budget. Therefore Canada needs to be collecting more in taxes.
- deleted 16y ago
- mmt 16y agoIt's worse than that.. there's all three of sales/use, income, and property.
- VladRussian 16y agowelcome to the hotel California.