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I moved from a state with no income tax and a sales tax to Oregon. I don't make six figures and I definitely pay more in OR state income tax than I did in sales

by bhayden 11y ago

I moved from a state with no income tax and a sales tax to Oregon. I don't make six figures and I definitely pay more in OR state income tax than I did in sales tax in my previous state.

15155 11y ago
6-8% of taxable expenditures, by definition, will equal less than the equivalent state income tax. Even if you spend every dime you make, your expenditure will almost never be completely sales-taxable (in our current system). The national, tax-everything sales tax doesn't tax idle money. People with money have lots of it and can spend it non-domestically.
- maratd 11y ago
  > The national, tax-everything sales tax doesn't tax idle money. There's no such thing as idle money. As soon as you deposit it in a bank, it gets loaned out to someone else who spends it. > People with money have lots of it and can spend it non-domestically. Even now, you're obligated to report any purchases made outside the jurisdiction and pay sales taxes on that yourself. I'm not suggesting we abolish the IRS. They should still be around and do audits and enforce the law, especially in such cases.
- dragonwriter 11y ago
  > 6-8% of taxable expenditures, by definition, will equal less than the equivalent state income tax. Not true; actual state income tax isn't its nominal rate on all income (state income tax usually starts with AGI and then has state deductions and credits). So 6-8% on some subset of expenditures may be more, equal, or less than 6-8%on subset of income. Heck, its not even true without considering that; it would be -- without considering that income tax excludes some income in the same way that sales tax excludes some expenditures -- if expenditures had to be less than income, but its possible to run a deficit as long as your income is sufficient to pay the increasing debt service cost, which (particularly with an increasing income over time) can be an arbitrarily long period of time.

by bhayden 11y ago

I moved from a state with no income tax and a sales tax to Oregon. I don't make six figures and I definitely pay more in OR state income tax than I did in sales tax in my previous state.

15155 11y ago

6-8% of taxable expenditures, by definition, will equal less than the equivalent state income tax. Even if you spend every dime you make, your expenditure will almost never be completely sales-taxable (in our current system). The national, tax-everything sales tax doesn't tax idle money. People with money have lots of it and can spend it non-domestically.

maratd 11y ago
> The national, tax-everything sales tax doesn't tax idle money. There's no such thing as idle money. As soon as you deposit it in a bank, it gets loaned out to someone else who spends it. > People with money have lots of it and can spend it non-domestically. Even now, you're obligated to report any purchases made outside the jurisdiction and pay sales taxes on that yourself. I'm not suggesting we abolish the IRS. They should still be around and do audits and enforce the law, especially in such cases.
dragonwriter 11y ago
> 6-8% of taxable expenditures, by definition, will equal less than the equivalent state income tax. Not true; actual state income tax isn't its nominal rate on all income (state income tax usually starts with AGI and then has state deductions and credits). So 6-8% on some subset of expenditures may be more, equal, or less than 6-8%on subset of income. Heck, its not even true without considering that; it would be -- without considering that income tax excludes some income in the same way that sales tax excludes some expenditures -- if expenditures had to be less than income, but its possible to run a deficit as long as your income is sufficient to pay the increasing debt service cost, which (particularly with an increasing income over time) can be an arbitrarily long period of time.