7 ms·

Interesting that no one ever talked about the alternative to Internet sales tax, to solve the competition problem: removing sales tax, and replacing it with use

• ScottBurson 14y ago
  Well, California, for example, has a use tax on items bought out of state, but it's unenforceable and compliance is pretty much nil. There are states with no sales tax, but I think you'd have trouble persuading those that have one to give it up.
• curt 14y ago
  Sales Taxes are the least economically destructive of all taxes. If a government's goal to optimize economic growth they should eliminate income, property, capital, etc taxes are replace them with a sales/consumption tax. Bobby Jindal proposed this in Louisiana.
  • lbarrow 14y ago
    Sales taxes are also regressive: poor people spend a higher percentage of their income than rich people, so any tax on spending will affect poor people more than rich people.
  • Retric 14y ago
    Sales Taxes are vary economically destructive as unlike income tax they artificially shift the economy from real goods to services. The only way to avoid this is to tax all spending and gift giving which ends up being just another income tax.
    • vbuterin 14y ago
      > from real goods to services Hence inventions like Canada's "goods and services" tax.
  • mikeash 14y ago
    What makes sales tax better than other taxes in this regard?
    • protomyth 14y ago
      It's fairly easy to collect (like gas taxes) since you're dealing with a set of vendors and not the whole population.
• greenyoda 14y ago
  For state legislatures, charging sales tax to buyers outside the state (like most internet buyers probably are) is much less politically risky than raising income or property taxes on state residents, since people outside the state can't vote them out of office. And raising income or property tax on someone who doesn't buy a lot of goods may end up being a net tax increase for that person, which might also incur their political wrath.
• just2n 14y ago
  I'm fine with income taxes so long as they're progressive and have no holes, such as investments in the stock market not being considered "income" so that people can make $800,000+ /yr and pay some obnoxious 15% in taxes while people making under $100,000 can easily pay over 25%. Feels like we're losing out on a few hundred billion/yr in tax revenue due to nonsense like that.
  • chatmasta 14y ago
    By "nonsense like that," do you mean nonsense like encouraging investment? We live in a capitalist society. Capital is eponymously fundamental to market growth. Discouraging investment by increasing capital gains tax is one of the surest ways to stymie economic growth. To do so for "a few hundred billion in tax revenue" would be unbelievably short sighted.
    • JamisonM 14y ago
      These are pretty bold claims given that the last cuts to capital gains offered little to no economic growth and hurt government revenues as well as contributing to the recent rise in income inequality in the US. Have a look at the published research on the topic.
      • adventured 14y ago
        The Fed's massive inflation is far more responsible for the rise in inequality in the US than anything else (and far more than a change in capital gains taxes). Including their constantly exploding bubbles that hammer the bottom 75% far more than the rich in standard of living terms. The cost of a house has doubled in 15 years (and housing is currently spiking again while real unemployment is 14%, thanks to the Fed's massive housing inflation). The cost of gasoline has gone up 3 to 4 fold in the same time frame. The cost of groceries have followed a huge inflationary curve over the last 15 / 30 / 50 years. Ditto the cost of a vehicle. Rich people can shield their money from inflation (easily in fact), average or poor people cannot shield their incomes from inflation. That simple fact is responsible for a huge destruction in standard of living in the US. Incomes have not even remotely kept up with inflation.