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Darius871
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Smith, Wesson, and the RODINA!!!
Mar 2002
time: 23:19
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quote:
[SIZE=1]Even if you exempt necessities, people still have to buy a lot of things that aren't food. |
Like what, besides clothing, toiletries, rent, utilities, healthcare, and school supplies? Anything else is an unnecessary luxury AFAICS. Someone making minimum wage while supporting a wife and two children shouldn't piss money away on anything other than the basics I've listed, and f*** him if he does.
Based on past discussions of this topic on another forum I'm sure the automatic response to this will be "Aha! You've just made it complicated and defeated the original purpose of a sales tax, which was supposed to be simplicity." I don't see how this is so.
Here's some simplicity for you:
Man buying white bread, pants, and toothbrush = not taxed.
Man buying boombox, palm pilot, and Cadillac = heavily taxed.
How on earth does this benefit the rich?
Last edited by Darius871 on 09-11-2004 at 21:24
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Drachasor
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More and more a computer with internet access is a necessary item to be a member of a modern society. Certainly a radio or television is important, or at least some method of getting news in necessary.
The fact is that the line between necessary items and luxuries is pretty fuzzy.
-Drachasor
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Kontiki
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Canada
Aug 2001
time: 00:19
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quote:
Originally posted by Darius871
Like what, besides clothing, toiletries, rent, utilities, healthcare, and school supplies? Anything else is an unnecessary luxury AFAICS. Someone making minimum wage while supporting a wife and two children shouldn't piss money away on anything other than the basics I've listed.
Based on past discussions of this topic on another forum I'm sure the automatic response to this will be "Aha! You've just made it complicated and defeated the original purpose of a sales tax, which was supposed to be simplicity." I don't see how this is so.
Here's some simplicity for you:
Man buying white bread, pants, and toothbrush = not taxed.
Man buying boombox, palm pilot, and Cadillac = heavily taxed.
How on earth does this benefit the rich? |
I think a better question is how does this benefit anybody? Even the rich will buy the necessities, so that's going to be by far the largest chunk of consumption right there. How much of a tax do you need on luxury items then? And don't you think that if buying a Ford Explorer just got 30+% more expensive, alot fewer of them would be sold?
If you work in enough exemptions, and factor in lost demand from high taxes on everything else, how can you possibly raise enough revenue?
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MrFun
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of Iowa
Nov 2000
time: 23:19
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quote:
Originally posted by JohnT
Can you explain how you drew that conclusion from the post you quoted?  |
If a person earning only $17,000 will pay $765 in income taxes, then someone earning, say, $255,000 would only pay $11,475. $765 divided by $17,000 = .045 which is 4.5 percent of income. $255,000 multiplied by .045 is $11,475. $11,475 in taxes for someone earning $255,000 is deplorably low.
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Darius871
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Smith, Wesson, and the RODINA!!!
Mar 2002
time: 23:19
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quote:
Originally posted by Drachasor
More and more a computer with internet access is a necessary item to be a member of a modern society. Certainly a radio or television is important, or at least some method of getting news in necessary.
The fact is that the line between necessary items and luxuries is pretty fuzzy. |
Great point. Personally I think only newspapers, other periodicals, and books should be exempted because A) radio, television, and computers are used for mindless entertainment more often than to be an informed citizen B) it's in the state's interest to encourage reading and C) electronics are too huge of a revenue source to exempt without increasing taxes on other luxuries far too drastically.
However that's just MHO, and I'd be happy with letting the legislators mapping out exemptions draw the line in this gray area. (Not to say that this isn't pure mental masturbation; we both know this'll never happen for obvious reasons.)
quote:
Originally posted by Kontiki
I think a better question is how does this benefit anybody? |
The most obvious benefit of it is the extreme simplicity compared to the current tax code. The other is that limiting taxation only to luxuries benefits the poor and middle class.
The other reason I like the idea is it allows individuals to freely choose their own levels of taxation. Think of it this way: today the only way a single person with no dependents can avoid paying taxes is by making less than ~$8,000 a year IIRC. If there were a national sales tax with necessity exemptions, anyone with any income can alter his/her lifestyle and not have to pay a dime, if they so choose.
quote:
Originally posted by Kontiki
How much of a tax do you need on luxury items then? And don't you think that if buying a Ford Explorer just got 30+% more expensive, alot fewer of them would be sold? |
You ignore the fact that the person buying that Explorer would have thousands upon thousands more dollars in his/her pocket from not having to pay income taxes.
quote:
Originally posted by Dauphin
A problem that you would have to be wary of is smuggling and black market goods from Canada, as well as excessive legal importing due to the difference in tax codes. |
That's the best argument against it I've ever heard, but I guess one could say the necessary increase in border security wouldn't damage the economy too much. As for 'legal importing' I don't know what you mean; if you go on the internet and order a product from Timbuktu it'd be taxed at the same rate as here.
Last edited by Darius871 on 09-11-2004 at 22:14
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Drachasor
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quote:
Originally posted by Darius871
Great point. Personally I think only newspapers, other periodicals, and books should be exempted because A) radio, television, and computers are used for mindless entertainment more often than to be an informed citizen B) it's in the state's interest to encourage reading and C) electronics are too huge of a revenue source to exempt without increasing taxes on other luxuries far too drastically. |
The problem with that is that the Television, Computer, and other sources are part of how we knit ourselves together as a society. When you start getting rid of all of the things that connect us together, you start eroding national unity and connections. These sources give everyone access to similar frames of reference, and that is a very, very important thing.
Hence a National Sales Tax as the only means of revenue is very, very flawed imho. You just won't be able to make it fair. A flat income tax with exemptions is better, but you'd still need a ton of exemptions to still be fair, and even then you might not be. Of course the exemptions basically make the system bracketed in essence, so it isn't all that much different from how it is now; it might make it easier to fill out the forms though.
Now, federally funded programs that let you fill out your tax info online and get free software that helps you fill out your taxes were be much, much more helpful.
-Drachasor
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JohnT
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Capitalist
Mar 1999
time: 00:19
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quote:
Originally posted by MrFun
If a person earning only $17,000 will pay $765 in income taxes, then someone earning, say, $255,000 would only pay $11,475. $765 divided by $17,000 = .045 which is 4.5 percent of income. $255,000 multiplied by .045 is $11,475. $11,475 in taxes for someone earning $255,000 is deplorably low. |
You haven't been following, have you. 
The flat tax proposal by Steve Forbes allowed a $12,500 deduction per individual, $6,000 per child, and a 17% tax rate.
Therefore, a person, filing as single, making $255,000 would pay the following:
255,000
-12,500
-----------
242,500
*.17
-----------
$41,225
or 16.6% of his earnings.
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DAVOUT
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AUERSTADT
Jun 2002
time: 05:19
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quote:
Originally posted by JohnT
You haven't been following, have you.
The flat tax proposal by Steve Forbes allowed a $12,500 deduction per individual, $6,000 per child, and a 17% tax rate.
Therefore, a person, filing as single, making $255,000 would pay the following:
255,000
-12,500
-----------
242,500
*.17
-----------
$41,225
or 16.6% of his earnings. |
Well, 16.17% would be more accurate 
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Kontiki
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Canada
Aug 2001
time: 00:19
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quote:
Originally posted by Darius871
The most obvious benefit of it is the extreme simplicity compared to the current tax code. The other is that limiting taxation only to luxuries benefits the poor and middle class.
The other reason I like the idea is it allows individuals to freely choose their own levels of taxation. Think of it this way: today the only way a single person with no dependents can avoid paying taxes is by making less than ~$8,000 a year IIRC. If there were a national sales tax with necessity exemptions, anyone with any income can alter his/her lifestyle and not have to pay a dime, if they so choose. |
I'm not sure you've established how much simpler it would be. Going back to your previous example of a man buying a pair of pants - no tax. Is that equally applicable to a pair of $500 Armani pants as it is to a $20 pair of pants from Walmart? Are all cars subject to the luxury tax, or is there some exemption for economy cars? How about used cars? I used to live by a store that flew in bread from France each morning - yours for only $60 a loaf. Is this bread tax exempt, or is it only certain brands/price points where this is applicable? What about something like power tools - workplace necessity or expensive hobby? Are cheap reading glasses tax exempt but more expensive ones aren't? Where do you draw the line?
As for freely choosing your level of taxation, how does that work, practically speaking? Does the military cost less to maintain if people buy less luxury items? Do police take a pay cut if there aren't enough Corvettes sold that year?
quote:
You ignore the fact that the person buying that Explorer would have thousands upon thousands more dollars in his/her pocket from not having to pay income taxes. |
OK, so you're doing away with income taxes altogether. How much does that sales tax on luxury items only have to be now? And I think you're ignoring the value people put on certain things. Just because you can statistically afford something doesn't mean that you're willing to pay the price. I make a good income and drive a nice car. But if I took home another $10k, it doesn't mean I would be willing to pay another $10k for my car, or even another $5k.
quote:
That's the best argument against it I've ever heard, but I guess one could say the necessary increase in border security wouldn't damage the economy too much. As for 'legal importing' I don't know what you mean; if you go on the internet and order a product from Timbuktu it'd be taxed at the same rate as here. |
And how are you going to pay for this increased border security when you've done away with income tax and taxes on the bulk of consumption?
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Kontiki
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Canada
Aug 2001
time: 00:19
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quote:
Originally posted by Kidicious
Do you actually think rich people are not going to buy yachts because there is a tax on them? |
Do you actually think that if the price of yachts went up, say, 30%, demand for them would be completely unchanged?
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09-11-2004 20:45
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