4 ms·
We (U.S) don't tax human labor. You can invest countless hours of your own effort into creating and/or improving property (including intangible property) and n
by PopAlongKid 4y ago
We (U.S) don't tax human labor. You can invest countless hours of your own effort into creating and/or improving property (including intangible property) and never pay a cent in tax.
Instead, we tax income.
- UncleEntity 4y agoAnd consumption in the form of sales tax.
- chmod600 4y agoOk, why do we tax income and capital gains (which have few externalities) vastly more than consumption (which has a lot of externalities)?
- rmah 4y agoTaxing consumption discourages consumption which thus acts as a drag on the overall economy. Further, most people view it as "unfair" because a fixed consumption tax (sales, GST, VAT) results in lower income people paying a higher percentage of their income as tax. Progressive income taxation 1) does not discourage consumption as much as a higher consumption tax for those with lower income (which is most people), 2) encourages investment for companies and individuals with higher incomes.