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It shouldn't really need to be mentioned at this point, but sales taxes are extremely regressive. The burden is shouldered by people with lower incomes. Edit -

It shouldn't really need to be mentioned at this point, but sales taxes are extremely regressive. The burden is shouldered by people with lower incomes. Edit - source: https://taxfoundation.org/taxedu/glossary/regressive-tax/ https://taxfoundation.org/taxedu/glossary/regressive-tax/

knallfrosch 2y ago
[flagged]
some-guy 2y ago
That is, unfortunately, the point.
panarky 2y ago
It should be obvious by now that the whole game is to shift cost and risk to the bottom 90% while shifting profit and wealth even further to loyalists among the top 0.1%. Viewed through this lens, the whole program is remarkably internally consistent. Tariffs on imports, cuts to corporate taxes, capital gains taxes and estate taxes, indiscriminate across-the-board reductions of 50% or more to regulatory agencies, etc.
- Dig1t 2y ago
  Aren’t tariffs just corporate taxes which are paid by big corps who import stuff built overseas? At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. Also the regulatory cuts are sorely needed at this point. It took longer to get regulatory approval for the Starship rocket than it did to actually build the rocket (the biggest and most complicated rocket ever built).
  - legitster 2y ago
    > At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. We could frame this another way - if every state in the US enacted tariffs on every other state, would we all be collectively richer or poorer? Maybe some states could set up their own cottage automotive industry, but overall there is going to be more deadweight loss to the economy than revenue made by the tariffs.
    - BytesAndGears 2y ago
      It depends… do the states share a common set of laws and values? Do the benefits of one state profiting transfer in part to other states? Is there a course for grievances to be settled across state lines with reciprocal legal coverage guaranteed? Are living and working standards reasonably similar, allowing companies to fairly compete across state lines? Those statements are generally not true across countries, but generally are true across states within a country. Things like working standards across countries mean that another country can employ slaves and have uncompetitive costs due to free labor, causing an unfair environment for those same companies forming in countries without slave labor. That is much less likely within the same country. So it’s not necessarily the same to frame tariffs across states to be similar to tariffs on other countries. There are meaningful differences that make it harder to ensure similar standards across countries, which can make tariffs be meaningful. It helps to account for externalities inherent to lacking the protections mentioned in the first paragraph.
  - hypeatei 2y ago
    > Aren’t tariffs just corporate taxes which are paid by big corps who import stuff built overseas? No, they're not "just" that. Those costs get passed onto the consumer in the form of higher prices. Corporations aren't going to eat the cost out of the goodness of their hearts. > At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. If a widget from China costs $100 because of tariffs, then American companies who make the same widget have no reason to undercut that since they know consumers have no other options -- effectively raising the price floor. There are also issues with the "union workers get the money" because we're effectively stiffing the rest of the U.S. population in order to prop up a specific segment of the economy.
    - BytesAndGears 2y ago
      The American consumers do have other options — other American companies. Who are all held to a higher standard than foreign companies due to sharing a regulatory environment. So the price may go up, but it will eventually tend toward the natural floor, even if higher than before, taking into account the externalities that were ignored with foreign widgets such as poor working conditions and environmental disregard that happens in certain other countries.
      - hypeatei 2y ago
        > So the price may go up No, the prices will go up. As you said, the cost goes up due to better working conditions, wages, etc... > The American consumers do have other options — other American companies Yes, but all of American companies will never go below whatever the Chinese widget costs unless tariffs go away.
        BytesAndGears 2y ago
        > American companies will never go below whatever the Chinese widget costs Why not? If there are 3 American companies with similar costs, would all of them just say “well, the price is the price?” Or would there eventually be one who realizes they can take more market share from the Chinese companies by undercutting them?
throw16180339 2y ago
That's a feature to the bill's sponsors.
vunderba 2y ago
Additionally, in most countries, crimes that carry a monetary penalty are also highly regressive (such as traffic violations like speeding).
Aunche 2y ago
This is a very unpopular opinion, but I believe ideally taxes in America should be more a lot more "regressive" like they are in Sweden. VATs are economically more efficient than income tax, and harder for corporations to avoid. Taxes are only actually regressive when the tax dollars don't go back into social services for the people, so that's something that would need to be prioritized first. I suspect that a major reason why the American government is so inefficient with spending is because there is no incentive for them to be, as the majority of tax dollars comes from a minority of high income workers. https://www.economist.com/united-states/2017/11/23/american-taxes-are-unusually-progressive-government-spending-is-not https://www.economist.com/united-states/2017/11/23/american-...
- CabSauce 2y ago
  I believe the most commonly supported tax strategy by economists is an income tax that goes negative below some threshold. Personally, I'm open to VAT tax because it would be much easier to incorporate the disposal cost into goods and remove externalities (like pollution). As you've said, it would be ideal to have strategies in place to lessen the burden on people with lower incomes. This bill doesn't have any of those strategies or objectives.
legitster 2y ago
Sales tax is not regressive per se. It's just much less progressive than an income tax. Rich people still pay more overall since they spend more money. An example of a regressive tax would be something like cigarette taxes - poor people would actually spend a larger share of their income since they are also more likely to smoke.
- deleted 2y ago
  [deleted]
- CabSauce 2y ago
  People with lower incomes do spend larger a portion of their money on things that incur sales tax. Higher income people spend more of their money on investments and other assets.
drivingmenuts 2y ago
It shouldn’t need to be said, and it probably won’t be. Even if it was said, most people probably wouldn’t get it. I’m sure the libertarian’s are rejoicing right now. As is every VC.
chrisco255 2y ago
You simply make basic necessities sales tax free. Fresh foods (non-processed), education materials and tuition, medical premiums, and the first $1K of housing per month, and problem solved. It's an easier tax to enforce and requires a smaller surveillance state. Instead of attempting to audit 350 million individuals the revenue dept can just focus on a couple million businesses. Instead of pouring over 15000 pages of write-offs and exemptions, it's a simple % of taxable revenue. The states that run on sales tax alone are more affordable than states that run off income tax. It's a superior tax in every way.

knallfrosch 2y ago

[flagged]

some-guy 2y ago

That is, unfortunately, the point.

panarky 2y ago

It should be obvious by now that the whole game is to shift cost and risk to the bottom 90% while shifting profit and wealth even further to loyalists among the top 0.1%. Viewed through this lens, the whole program is remarkably internally consistent. Tariffs on imports, cuts to corporate taxes, capital gains taxes and estate taxes, indiscriminate across-the-board reductions of 50% or more to regulatory agencies, etc.

Dig1t 2y ago
Aren’t tariffs just corporate taxes which are paid by big corps who import stuff built overseas? At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. Also the regulatory cuts are sorely needed at this point. It took longer to get regulatory approval for the Starship rocket than it did to actually build the rocket (the biggest and most complicated rocket ever built).
- legitster 2y ago
  > At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. We could frame this another way - if every state in the US enacted tariffs on every other state, would we all be collectively richer or poorer? Maybe some states could set up their own cottage automotive industry, but overall there is going to be more deadweight loss to the economy than revenue made by the tariffs.
  - BytesAndGears 2y ago
    It depends… do the states share a common set of laws and values? Do the benefits of one state profiting transfer in part to other states? Is there a course for grievances to be settled across state lines with reciprocal legal coverage guaranteed? Are living and working standards reasonably similar, allowing companies to fairly compete across state lines? Those statements are generally not true across countries, but generally are true across states within a country. Things like working standards across countries mean that another country can employ slaves and have uncompetitive costs due to free labor, causing an unfair environment for those same companies forming in countries without slave labor. That is much less likely within the same country. So it’s not necessarily the same to frame tariffs across states to be similar to tariffs on other countries. There are meaningful differences that make it harder to ensure similar standards across countries, which can make tariffs be meaningful. It helps to account for externalities inherent to lacking the protections mentioned in the first paragraph.
- hypeatei 2y ago
  > Aren’t tariffs just corporate taxes which are paid by big corps who import stuff built overseas? No, they're not "just" that. Those costs get passed onto the consumer in the form of higher prices. Corporations aren't going to eat the cost out of the goodness of their hearts. > At least when you incentivize stuff to get built here the money goes to union workers or at least stays within the US. If a widget from China costs $100 because of tariffs, then American companies who make the same widget have no reason to undercut that since they know consumers have no other options -- effectively raising the price floor. There are also issues with the "union workers get the money" because we're effectively stiffing the rest of the U.S. population in order to prop up a specific segment of the economy.
  - BytesAndGears 2y ago
    The American consumers do have other options — other American companies. Who are all held to a higher standard than foreign companies due to sharing a regulatory environment. So the price may go up, but it will eventually tend toward the natural floor, even if higher than before, taking into account the externalities that were ignored with foreign widgets such as poor working conditions and environmental disregard that happens in certain other countries.
    - hypeatei 2y ago
      > So the price may go up No, the prices will go up. As you said, the cost goes up due to better working conditions, wages, etc... > The American consumers do have other options — other American companies Yes, but all of American companies will never go below whatever the Chinese widget costs unless tariffs go away.
      - BytesAndGears 2y ago
        > American companies will never go below whatever the Chinese widget costs Why not? If there are 3 American companies with similar costs, would all of them just say “well, the price is the price?” Or would there eventually be one who realizes they can take more market share from the Chinese companies by undercutting them?

throw16180339 2y ago

That's a feature to the bill's sponsors.

vunderba 2y ago

Additionally, in most countries, crimes that carry a monetary penalty are also highly regressive (such as traffic violations like speeding).

Aunche 2y ago

This is a very unpopular opinion, but I believe ideally taxes in America should be more a lot more "regressive" like they are in Sweden. VATs are economically more efficient than income tax, and harder for corporations to avoid. Taxes are only actually regressive when the tax dollars don't go back into social services for the people, so that's something that would need to be prioritized first. I suspect that a major reason why the American government is so inefficient with spending is because there is no incentive for them to be, as the majority of tax dollars comes from a minority of high income workers. https://www.economist.com/united-states/2017/11/23/american-taxes-are-unusually-progressive-government-spending-is-not https://www.economist.com/united-states/2017/11/23/american-...

CabSauce 2y ago
I believe the most commonly supported tax strategy by economists is an income tax that goes negative below some threshold. Personally, I'm open to VAT tax because it would be much easier to incorporate the disposal cost into goods and remove externalities (like pollution). As you've said, it would be ideal to have strategies in place to lessen the burden on people with lower incomes. This bill doesn't have any of those strategies or objectives.

legitster 2y ago

Sales tax is not regressive per se. It's just much less progressive than an income tax. Rich people still pay more overall since they spend more money. An example of a regressive tax would be something like cigarette taxes - poor people would actually spend a larger share of their income since they are also more likely to smoke.

deleted 2y ago
[deleted]
CabSauce 2y ago
People with lower incomes do spend larger a portion of their money on things that incur sales tax. Higher income people spend more of their money on investments and other assets.

drivingmenuts 2y ago

It shouldn’t need to be said, and it probably won’t be. Even if it was said, most people probably wouldn’t get it. I’m sure the libertarian’s are rejoicing right now. As is every VC.

chrisco255 2y ago

You simply make basic necessities sales tax free. Fresh foods (non-processed), education materials and tuition, medical premiums, and the first $1K of housing per month, and problem solved. It's an easier tax to enforce and requires a smaller surveillance state. Instead of attempting to audit 350 million individuals the revenue dept can just focus on a couple million businesses. Instead of pouring over 15000 pages of write-offs and exemptions, it's a simple % of taxable revenue. The states that run on sales tax alone are more affordable than states that run off income tax. It's a superior tax in every way.