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> You could propose something like VAT + income tax for those who make over $1 million/year or something... What did a person making $1m/year do wrong they are

> You could propose something like VAT + income tax for those who make over $1 million/year or something... What did a person making $1m/year do wrong they are penalized unfairly against another person that doesn't? I have a feeling, much like now, all this accomplishes in reality is the rich hire good enough accounts to hide their largest sums from the IRS. That leaves the middle class and poor once again bearing everything... and we're back to where we started. Carving out 0 exceptions and sticking to it ensures that that literally nobody can say they are being treated unfairly.

AnimalMuppet 5y ago
Well, spin it how you will, but we've had this idea of a "progressive" tax system for quite a while now. ("Progressive" in the sense that those who make more, pay more, presumably because they can afford it more.) Our tax system has been that way for more than a century. So, you can call that "penalized unfairly", and others can call it "paying their fair share", but the reality is that it is the current default option. If you want a different system, you're going to need a lot better argument than "penalized unfairly". You're going to need an argument that can move the majority of voters, most of whom do not make more than $1 million/year. My previous point wasn't anything about "should", by the way. I was merely saying that, in the current political climate, not hitting the rich harder was something that would make it harder for a VAT-only scheme to become reality.
- jfengel 5y ago
  You're going to need an argument that can move the majority of voters, most of whom do not make more than $1 million/year. Note that a lot of voters are convinced that they will make $1 million/year some day. Perhaps not today, but some day, and they seem happy to pay more today to ensure that they are not "penalized unfairly" when it's their turn. This is not necessarily a rational approach, since very few of them will ever earn that much money. But if your goal is to get votes, you can go a very, very long way with "penalized unfairly". Note how many oppose an inheritance tax that they'll never pay, simply by the expedient of dubbing it a "death tax". The "penalized unfairly" argument wouldn't wash with most economists, but there's not all that many of them. And nobody really listens to them anyway.

AnimalMuppet 5y ago

Well, spin it how you will, but we've had this idea of a "progressive" tax system for quite a while now. ("Progressive" in the sense that those who make more, pay more, presumably because they can afford it more.) Our tax system has been that way for more than a century. So, you can call that "penalized unfairly", and others can call it "paying their fair share", but the reality is that it is the current default option. If you want a different system, you're going to need a lot better argument than "penalized unfairly". You're going to need an argument that can move the majority of voters, most of whom do not make more than $1 million/year. My previous point wasn't anything about "should", by the way. I was merely saying that, in the current political climate, not hitting the rich harder was something that would make it harder for a VAT-only scheme to become reality.

jfengel 5y ago
You're going to need an argument that can move the majority of voters, most of whom do not make more than $1 million/year. Note that a lot of voters are convinced that they will make $1 million/year some day. Perhaps not today, but some day, and they seem happy to pay more today to ensure that they are not "penalized unfairly" when it's their turn. This is not necessarily a rational approach, since very few of them will ever earn that much money. But if your goal is to get votes, you can go a very, very long way with "penalized unfairly". Note how many oppose an inheritance tax that they'll never pay, simply by the expedient of dubbing it a "death tax". The "penalized unfairly" argument wouldn't wash with most economists, but there's not all that many of them. And nobody really listens to them anyway.