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Classic consumption taxes (sales taxes and VAT) tend to be quite regressive. I haven't read the whole report, but this was studied in 2005[1] and they had to a
by cmonagle 6y ago
Classic consumption taxes (sales taxes and VAT) tend to be quite regressive.
I haven't read the whole report, but this was studied in 2005[1] and they had to add a "Family Credit" (basically a UBI) of 500-1000$ per month to balance it out, and recovered approximately 65% of individual and corporate income taxes.
1. https://govinfo.library.unt.edu/taxreformpanel/final-report/TaxPanel_8-9.pdf https://govinfo.library.unt.edu/taxreformpanel/final-report/...
- nemo44x 6y agoYeah more or less credit it back as a function of income by way of monthly payouts. At a certain income the credits begin getting phased out slowly. You can also tax different things at different rates. For instance, vegetables sound be taxed differently than yachts. It also lets externalities be taxed the entire lifecycle of the good or service.
- nullserver 6y agoSounds like the fair tax by Neil Bortz. High sales tax on all “new” products. None on used. A check to everyone each month so that poor don’t suffer from it. Basically eliminates the IRS, and much of the Tax compliance / avoidance industry. Stops a lot of the tax nonsense that corporations and congress loves.
- csunbird 6y agoThe problem with that is, people (usually rich people) will stop buying expensive stuff in the country, and they start buying them from another country that does not have any sales tax. Rich people avoid taxes and poor people are now stuck with the VAT on their daily needs.
- nullserver 6y agoTax purchases made overseas. Tariffs are already used a lot.
- mcguire 6y agoOr, as a government professor I once had said, "You can only eat so much filet mignon a day."
- ghaff 6y agoVariants of that are even older. Here's one variant of a quote often attributed to Adolphus Busch: “You can only drink 30 or 40 glasses of beer a day, no matter how rich you are.”