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Just because it only affects 1% of the population is of no support for this tax, imo it goes to show how our system is completely unfair(i know many will disagr

Just because it only affects 1% of the population is of no support for this tax, imo it goes to show how our system is completely unfair(i know many will disagree with me on that point) Maybe i'm living outside of reality but i don't understand why we can't have a single flat sales tax. The more you spend the more you pay. For some reason people think that just because you make more means you should pay a higher %, ofc you should pay more, but a higher % is the complete definition of unfair.

hedgehog 14y ago
The argument against is essentially that sales taxes are regressive because wealthier people spend less of their wealth and thus pure sales tax is not a fair way to divide costs.
- jug6ernaut 14y ago
  That argument is completely subjective though. Unless you mean spend less to... essentials? I mean where does that even come from? "wealthier people spend less of their wealth"? Is this a statistical fact?(im seriously asking lol). I am by NO means wealthy lol, but if i had more money i know i would definitely be spending it lol.
  - qdog 14y ago
    People with lower incomes have a lower savings rate because they have to buy essentials, yes. Wealthy people would then end up paying a much smaller percentage of their income compared to everyone else. People who come into wealth quickly seem to spend money quickly (athletes and lotto winners come to mind, hell even Willie Nelson went bankrupt at one point). People who earn wealth more slowly tend to end up investing their money and saving a larger percentage. If you make 300k/year, you could save 25% without blinking an eye, not so much if you earn 30k/year, especially if you have a dependent.
- danielweber 14y ago
  Those progressive European democracies all have VATs. Of the top 20 economies in the world, the US is the only one without a VAT. This doesn't mean it's a good idea, or a bad idea, but very progressive places have used them without the world ending. It's probably a good way to keep spending in check, because it makes it a lot harder to jack up someone else's taxes to pay for your stuff. (And while they do tax their rich more than America taxes its rich, the shape of the slope is nowhere what you would imagine. It's very rare for any marginal rate to get over 50%.)
stevenkovar 14y ago
The less wealthy an individual, the greater an effect sales taxes have on quality of life; someone who makes $25,000/yr will spend a much greater proportion of income on goods (and thus, taxes) than someone who makes $2,500,000.
voodoomagicman 14y ago
Some practical arguments against a sales tax: - It is a disincentive towards spending and would hurt the economy - It creates a black market, encouraging tax avoidance and organized crime - It incentives consumption abroad And some in favor of progressive taxation: - Letting the lowest earners keep their money can be cheaper than taking it and then giving it back through inefficient social services - Tax cuts on low earners translate to increased spending better than tax cuts on high earners Regarding fairness, how is it fair that one person is born to wealthy parents and inherits $5 million while another inherits nothing, but unfair to set tax rates based on income?

hedgehog 14y ago

The argument against is essentially that sales taxes are regressive because wealthier people spend less of their wealth and thus pure sales tax is not a fair way to divide costs.

jug6ernaut 14y ago
That argument is completely subjective though. Unless you mean spend less to... essentials? I mean where does that even come from? "wealthier people spend less of their wealth"? Is this a statistical fact?(im seriously asking lol). I am by NO means wealthy lol, but if i had more money i know i would definitely be spending it lol.
- qdog 14y ago
  People with lower incomes have a lower savings rate because they have to buy essentials, yes. Wealthy people would then end up paying a much smaller percentage of their income compared to everyone else. People who come into wealth quickly seem to spend money quickly (athletes and lotto winners come to mind, hell even Willie Nelson went bankrupt at one point). People who earn wealth more slowly tend to end up investing their money and saving a larger percentage. If you make 300k/year, you could save 25% without blinking an eye, not so much if you earn 30k/year, especially if you have a dependent.
danielweber 14y ago
Those progressive European democracies all have VATs. Of the top 20 economies in the world, the US is the only one without a VAT. This doesn't mean it's a good idea, or a bad idea, but very progressive places have used them without the world ending. It's probably a good way to keep spending in check, because it makes it a lot harder to jack up someone else's taxes to pay for your stuff. (And while they do tax their rich more than America taxes its rich, the shape of the slope is nowhere what you would imagine. It's very rare for any marginal rate to get over 50%.)

stevenkovar 14y ago

The less wealthy an individual, the greater an effect sales taxes have on quality of life; someone who makes $25,000/yr will spend a much greater proportion of income on goods (and thus, taxes) than someone who makes $2,500,000.

voodoomagicman 14y ago

Some practical arguments against a sales tax: - It is a disincentive towards spending and would hurt the economy - It creates a black market, encouraging tax avoidance and organized crime - It incentives consumption abroad And some in favor of progressive taxation: - Letting the lowest earners keep their money can be cheaper than taking it and then giving it back through inefficient social services - Tax cuts on low earners translate to increased spending better than tax cuts on high earners Regarding fairness, how is it fair that one person is born to wealthy parents and inherits $5 million while another inherits nothing, but unfair to set tax rates based on income?