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> Taxing consumption vs. taxing income promotes more savings and less consumption It promotes saving amongst people who can afford to save. For poor/normal peo
by ronaldx 12y ago
> Taxing consumption vs. taxing income promotes more savings and less consumption
It promotes saving amongst people who can afford to save. For poor/normal people there are several priorities they are not meeting before they would reach savings.
Poor people generally already consume way below their minimum preferred standard of living - given the option, they won't consume less. Rich people will consume less.
And then, less consumption precludes trickle-down and decreases opportunities for those poor people. Overall, very bad.
- lsaferite 12y agoI don't disagree. I'm not an economist so I can only look at it from what I think is logical. That being said, I read about the FairTax proposal a long time back and that is what turned me on to the idea of preferring consumption vs. income tax. In that proposal they actually address the issue via a poverty level spending tax rebate (prebate in the plan). If the net effect on the poor is basically a wash, do you still object to the idea? Do you also have a problem with the idea of less consumption as you feel it will overall hurt our economy? Personally I welcome the idea of burning the current tax code and starting fresh with a simple consumption tax collected by businesses. As a side note, the 'richer' people become, the more they find ways and can afford ways to avoid, and in some cases evade, paying taxes. The poor and lower-middle class cannot generally afford to do this. Not to mention large corporations and the games they play.