If you were president of your country...

[Keef]

At the moment my dad is a little low on hours at work. I'll just use an average of his usual checks and his recent smaller ones. At 15% taxes and social security, he'd save over a hundred dollars a week. And that's an underestimate on a below-normal check. I might want to do more math and present to him the fact that he could easily save over $400 a month.

Assuming we don't actually spend that, well, that's $400 a month saved. Actually it'd be great to use that to pay off the house. That'd be about half again what our house payment is, and not just once a year, but every month. They could make up for their crappy refinance decision a long time ago in a matter of a few years!

Time to start spreading the word with math instead of theories?

 

[Danoff]

At the moment my dad is a little low on hours at work. I'll just use an average of his usual checks and his recent smaller ones. At 15% taxes and social security, he'd save over a hundred dollars a week. And that's an underestimate on a below-normal check. I might want to do more math and present to him the fact that he could easily save over $400 a month.

Assuming we don't actually spend that, well, that's $400 a month saved. Actually it'd be great to use that to pay off the house. That'd be about half again what our house payment is, and not just once a year, but every month. They could make up for their crappy refinance decision a long time ago in a matter of a few years!

Time to start spreading the word with math instead of theories?

Make sure to adjust your monthly expenses by ~30%

 

[Keef]

Good point. I forgot about the other half.

If the sales tax applies to all goods and services, from apples to internet, I'll have to confer with mom and get some numbers.

 

[FoolKiller]

Make sure to adjust your monthly expenses by ~30%

To what degree? Is there a sales tax on my loan payments? I paid that sales tax when I bought the car. What about my auto and property insurances?

Depending on what you have loans on you may only have a sales tax increase affect half your expenses.

EDIT: And would your plan eliminate all those little tiny taxes on things like phone and electric bills and just charge them as a sales tax?

 

[Danoff]

To what degree? Is there a sales tax on my loan payments? I paid that sales tax when I bought the car. What about my auto and property insurances?

Depending on what you have loans on you may only have a sales tax increase affect half your expenses.

Or less. I'm just reminding Keef not to get carried away with the upside of not paying income tax - because there is a downside. The government still needs a crapload of money to function.

EDIT: And would your plan eliminate all those little tiny taxes on things like phone and electric bills and just charge them as a sales tax?

Hard to say whether those are all unconstitutional. They'd have to be taken case by case.

 

[Indigo Heron]

30% federal sales tax on top of any state sales tax that may come after that?

The sales tax idea still sounds incredibly loony and populist to me. A federal sales tax falls most heavily on the big consumers - the middle class. They would have to pay a much higher percentage of their income as compared to wealthy, high-class individuals. How do you feel if you were a person making $40,000 a year with a family to feed paying for the same amount in sales tax when compared to a person making $400,000 a year?

To cut down on spending, middle-income families would have to buy used products to avoid taxes. This would discourage economic growth. Even stating this simply means that abolishing the income tax and implementing a sales tax system would be incredibly risky, as the government would rely on the people's confidence in consumer products. All in all, if consumer confidence drops steeply, the government would not have the money to pay for anything (healthcare, education, defence...).

Also, with the introduction of a sales tax, there would be a massive encouragement for a black market in retail items for people looking to 'cheat'.

Then, the Hill would then find out that poor people pay almost the same amount in sales tax as they would for wealthy people, so they end up introducing legislation and/or some kind of ID card that determines which group you fall into to help poor people pay less and wealthy people pay more. To go with the system, the government has to install a massive new bureaucracy just to make sure that the flow of retail goods is regulated.

 

[FoolKiller]

The sales tax idea still sounds incredibly loony and populist to me. A federal sales tax falls most heavily on the big consumers - the middle class. They would have to pay a much higher percentage of their income as compared to wealthy, high-class individuals. How do you feel if you were a person making $40,000 a year with a family to feed paying for the same amount in sales tax when compared to a person making $400,000 a year?

You don't get how a sales tax rate works do you?

I, making under $35,000 a year, buy a $15,000 car. I would pay $4500 in sales taxes, but I would not be paying as much as $500 month in income taxes. And possibly not paying a few hundred in property taxes every year.

Now, some guy that makes $350,000 a year buys a $55,000 car. He pays $16,500 in sales taxes.

How did I pay more?

Have you never noticed that rich people not only make more but they buy more expensive stuff, and more of it? Rich people somehow manage to have the same credit problems the middle class has because they spend more money.

Rich people will pay a higher amount, but an equal (read fair) rate.

Can I ask why you feel you must discriminate against the wealthy and not only make them pay more dollars, but a larger percentage of their dollars?

All in all, if consumer confidence drops steeply, the government would not have the money to pay for anything (healthcare, education, defence...).

While I cannot speak for Malaysia, the US Constitution does not list two of the three examples you gave as being allowed to be paid for by taxes.

Also, with the introduction of a sales tax, there would be a massive encouragement for a black market in retail items for people looking to 'cheat'.

As opposed to the tax shelters and loopholes people find to use today? Or heck, some people go decades without paying taxes before they get caught. Sales tax would eliminate more ways to cheat than any black market grocery could provide.

Then, the Hill would then find out that poor people pay almost the same amount in sales tax as they would for wealthy people,

Since they wouldn't find that, because poor people are not buy BMWs, none of teh other stuff you said would happen would actually happen for that reason.

That is not to say that legislators wouldn't attempt to do that, because after all they do love to discriminate against and hate the rich. But again you are describing a problem that happens in a great deal now. We just call it welfare.

 

[Indigo Heron]

Look at the percentage of income you're setting aside to pay for that. Since you're earning $35,000 a year and buying a $15,000 (I'm guessing that this is a simple family car - Honda Civic?), you are spending approximately 42.9% of your income just to purchase the Civic.

In the meantime, for the person making $350,000 a year, buying a $55,000 (BMW 5 series) car, means that he only spends 15.7% of his income to purchase for the car. How 'fair' does that sound?

Besides, you're not including necessities like food and clothing. A car is a luxury item.

While I cannot speak for Malaysia, the US Constitution does not list two of the three examples you gave as being allowed to be paid for by taxes.

You're not answering the question. How would the government pay for them if there is no steady source of income?

 

[ROAD_DOGG33J]

Besides, you're not including necessities like food and clothing. A car is a luxury item.

The cost of food and utilities are about the only things that decrease in cost percentage-wise when income increases.

 

[FoolKiller]

Look at the percentage of income you're setting aside to pay for that. Since you're earning $35,000 a year and buying a $15,000 (I'm guessing that this is a simple family car - Honda Civic?), you are spending approximately 42.9% of your income just to purchase the Civic.

In the meantime, for the person making $350,000 a year, buying a $55,000 (BMW 5 series) car, means that he only spends 15.7% of his income to purchase for the car. How 'fair' does that sound?

1) It is a VW Rabbit. 2) If I only wanted to spend 15.7% of my income on a vehicle I could have. I did not have to buy new. In fact, I had not intended to until I test drove the Rabbit.

And as for fairness: I live in a free society where a man's choices decide his fate. A man chooses. I am also still very early in my career, being less than ten years out of college. I could go get a Master's degree and jump my salary much quicker than just working my way up in my career.

The man making $350,000 has earned that money in his job. He may be a neurosurgeon who saves people's lives by removing brain cancer, or he may be an engineer that invented some device that makes all our lives much safer. Or he could have invented a robotic vacuum. Whatever it is, he did it on his own, by his own means, and has earned that money. His choice to buy a car that is only 15.7% of his income was his choice. He could have bought the same Rabbit I did and saved even more money. But he didn't. He could have ordered a $100,000 car. He likely also owns a $1 million home while I do not own the house I live in, meaning that he pays a much larger percentage of his income toward housing than I ever will.

But this has nothing to do with the sales tax point. So what if I bought a car that was 42% of my annual income and he only paid 15% of his annual income? The fact is that the tax, which is what we are discussing (if you want to dicsuss class warfare you should start another thread), does not take more from me than it does from the rich guy, despite the fact that my choice of car is much more of my annual income.

How is it fair? Because he earned his money and I did not. How is it fair that someone who doesn't have a job can buy food on government food stamps paid for from that man's, and even my own, paycheck?

I'm not sure I will ever convince you because from your comments I am beginning to think that you see people just having more money than others as a bad thing, when in reality the majority of people who would be considered rich earned that money on their own.

Besides, you're not including necessities like food and clothing. A car is a luxury item.

OK, I shop at Wal*Mart and similar places for food and groceries. My jeans cost $20 max. The majority of my t-shirts were free or under $15. My work pants are likely $25 each and work shirts under $25.

The rich guy buys custom made suits that costs thousands of dollars a pop. He buys his special food from a specialty market so he can have whatever weird taste he likes because his fancy lifestyle does not include pizza and burgers like mine does.

My lunch is either leftovers from supper or the $2.99 sub from the local grocery deli, while Mr. Rich is catering in lunches at work so that he can work his full 18 hours a day.

What really are you getting at here? The point of a sales tax is that your lifestyle choices[/] determine how much tax you pay. You want the daily special $6 burger? $1.80 for tax. You want the $25 Filet? $7.50 in tax. Mr. Rich just paid more in taxes than my meal cost me. That is fair. Why? Because he chose to eat that expensive meal.

You're not answering the question. How would the government pay for them if there is no steady source of income?

Um, you missed the point. The government wouldn't be paying for two of them.

But to answer your question: The entire economy would not go black market. We could just as easily pay each other in cash under the table today to avoid paying taxes (millions of illegal immigranst do it all the time). Do you think everyone is some kind of cheat or criminal just waiting to happen or something? Why would everyday goods go black market when everyday jobs haven't now?

You are making up crimes to argue against a new system you don't understand or like, but ignoring that those same crimes could be done under the current system but aren't. An amazing thing is that many people will agree to obey the law. We see it all the time in the opinions forum where someone will disagree with some law and someone else jumps in and says, "but that is the law so that is how it is."

Yes, some people will try to cheat the law, but do you really think housewives, factory workers, and bank executives are going to buy their groceries and clothes off a truck in a dark alley?

And by the way, used goods are bought by all classes of people in the US already. We call them used car lots, consignment shops, and satan GameStop. And we pay sales tax on all those things now. So, your idea of everyone suddenly buying used is pointless because we already do.

 

[Small_Fryz]

In Australia we get Taxed on income then pay 10% GST on almost any goods, some goods can get taxed GST 2 or more times in its life before its finally sold.. (transport / components etc) I reckon we pay far to much taxes... but doesnt everyone?

 

[Jay]

Thats why our government has a huge surplus cash, which until recently they don't like putting any back into the economy, only their own bank accounts.

 

[Indigo Heron]

His choice to buy a car that is only 15.7% of his income was his choice. He could have bought the same Rabbit I did and saved even more money. But he didn't. He could have ordered a $100,000 car. He likely also owns a $1 million home while I do not own the house I live in, meaning that he pays a much larger percentage of his income toward housing than I ever will.

Ah, so he could've bought the same Rabbit you did, and bought practically the same house you did too.

OK, I shop at Wal*Mart and similar places for food and groceries. My jeans cost $20 max. The majority of my t-shirts were free or under $15. My work pants are likely $25 each and work shirts under $25.

The rich guy buys custom made suits that costs thousands of dollars a pop. He buys his special food from a specialty market so he can have whatever weird taste he likes because his fancy lifestyle does not include pizza and burgers like mine does.

My lunch is either leftovers from supper or the $2.99 sub from the local grocery deli, while Mr. Rich is catering in lunches at work so that he can work his full 18 hours a day.

What really are you getting at here? The point of a sales tax is that your lifestyle choices[/] determine how much tax you pay. You want the daily special $6 burger? $1.80 for tax. You want the $25 Filet? $7.50 in tax. Mr. Rich just paid more in taxes than my meal cost me. That is fair. Why? Because he chose to eat that expensive meal.

You don't think that there is a person in high-class society who favours wearing casual rather than 'custom-made suits'? You don't think that there is a person in high-class society will enjoy a simple cheeseburger from a McDonald's?

Um, you missed the point. The government wouldn't be paying for two of them.

Well, mind enlightening me on what they are? Are you implying that you want to privatise defence, healthcare and education (cancel the odd one that the government does pay). If you had it your way, would you prefer that the government not pay for all three?

Why would everyday goods go black market when everyday jobs haven't now?

You cannot compare everyday jobs to black market goods.

You are making up crimes to argue against a new system you don't understand or like, but ignoring that those same crimes could be done under the current system but aren't. An amazing thing is that many people will agree to obey the law. We see it all the time in the opinions forum where someone will disagree with some law and someone else jumps in and says, "but that is the law so that is how it is."

You are trying to ignore for the amount of crime that a national sales tax would bring as well.

Under the U.S. tax system, a person earning $400,000 a year pays about twenty-seven times the national average in income tax. Assuming that if I were to have that kind of earning capability, I would pay my fair share, and the fair share of twenty-six other
people. I’m happy to ‘cause that’s the only way it’s going work, and it’s in my
best interest that everybody be able to go to schools and drive on roads, but I don’t
get twenty-seven votes on Election Day. Neither does the fire department come to my house twenty-seven times faster, nor does the water flow out of my tap twenty-seven times hotter.

Yes, some people will try to cheat the law, but do you really think housewives, factory workers, and bank executives are going to buy their groceries and clothes off a truck in a dark alley?

People would be astounded at how great the lengths people are willing to go to to save money. However, your scenario does seem far-fetched, since they aren't buying illegal weapons, but I would imagine that with some tweaking (e.g. a goods store selling 'unregistered' products or something like that)...

So, you're all for introducing a controversial tax system and creating a massive, new bureaucracy to run an incredibly complex government regulation program Since it already is a problem to regulate firearms, I'm guessing that the regulation of goods is going to be...a lot more difficult?

 

[Leonidae]

1.) People who have issues with drinking and drugs would be forced to go in for treatment. Especially if they have family.
2.) Worklife practice programs that would encourage companies into taking in students that have just finished their studies in order to improve their skills and give them experience.
3.) Remove car and fuel taxes entirely.
4.) Driving under influence of drugs or alcohol would lead to losing the car to the local authorities that can either sell it in an auction, sell it to a dealership or sell it for parts.
5.) Driving and talking in a phone would lead to a week long shutdown.
6.) Teenage drivers would need to drive diesel-powered moped cars for 2 years before getting a real car.
7.) Police force would get a fund raise.
8.) Military would get access to school PE programs in order to improve the poor health of youth. Also, PE programs would get bigger part in education from the very beginning.
9.) government representatives would get a hefty cut in their salaries. gathered funds would be directed to education and healthcare.
10.) few pet projects.. own space program, own military aircrafts, own car manufacturer etc..
11.) close the border and sort out the immigrant issue.

 

[Keef]

How about this whole sales tax be a little lower than 30%, and how about we make the fuel tax variable in a way that it would keep the price of a gallon of gas at $3.00 a gallon or so. This would be my stealth protest against the Dodge Ram, the Dodge Ram 4x4, the Silverado Crew Cab HD, the Expedition, the F150, and the Sequoia (a Toyota in Dayton..who'da thunk it) that I was surrounded by on either end in my recent trip to the Sonic drive through. The Sonic is delicious, but it would have been even more delicious if it wasn't tainted with Appalachian American exhaust fumes.

Just for emphasis, I'll have you all know that those trucks were all occupied by one person, all had what appeared to be empty beds and interiors, none of them were towing a trailer, the roads are dry and therefore none of them needed 4WD, and they were all idling their enormous V8s the whole time we were sitting there waiting through Sonic's technical difficulties.

/rant.

Oh, and I would expect better quality roads from this tax hike, of course. Maybe something at half the standard of typical German autobahn.

 

[niky]

Ah, so he could've bought the same Rabbit you did, and bought practically the same house you did too.

If you know any neurosurgeons who drive dinky little cars instead of Mercedes convertibles, please tell me. I'd like to shake their hand.

You don't think that there is a person in high-class society who favours wearing casual rather than 'custom-made suits'? You don't think that there is a person in high-class society will enjoy a simple cheeseburger from a McDonald's?

And they should pay more for the cheeseburger just because they can? You know what we call those people who make lots of money and spend it on hotel dinners? Millionaires. You know what we call people who make lots of money, wear simple clothes and eat cheeseburgers? Billionaires. If a person is smart enough to buy as little as possible with his money, he should be allowed to keep what he saves.

The same would go for the working class. Don't want to pay 20% tax on a cheeseburger? Eat at home. I'm astounded by how many people who are poorer than I am spend hundreds of dollars a month on designer (Starbucks) Coffee. Now, because I'm more frugal than them, I should pay more in tax? For what?

Well, mind enlightening me on what they are? Are you implying that you want to privatise defence, healthcare and education (cancel the odd one that the government does pay). If you had it your way, would you prefer that the government not pay for all three?

Through sales tax, government could pay. But I'd rather that government not run defense, healthcare and education. Government programs are subject to too much politics and whimsy. By contracting out education to private institutions, for example, government can provide higher quality education for less cost. I studied at a government university, paying 1/3rd the tuition I would have at a private school... but, shockingly, the government was subsidizing my education to the tune of 100% the tuition of a private school. If we were to contract education to private institutions instead, taxpayers would be paying just 2/3rds to 1/2 the money for social programs like education or healthcare.

You cannot compare everyday jobs to black market goods.

So why would the black market increase if it hasn't now with current sales taxes? We're exchanging bank fraud, credit fraud and tax evasion for a possible increase in black market activity... which may or may not happen, as the gray market itself has grown huge in the last decade, thanks to the internet. Private sales of secondhand goods and private trade isn't taxed as much as retail trade (if at all)... but that doesn't cripple the white market, now, does it?

You are trying to ignore for the amount of crime that a national sales tax would bring as well.

Prove it.

Under the U.S. tax system, a person earning $400,000 a year pays about twenty-seven times the national average in income tax. Assuming that if I were to have that kind of earning capability, I would pay my fair share, and the fair share of twenty-six other
people. I’m happy to ‘cause that’s the only way it’s going work, and it’s in my
best interest that everybody be able to go to schools and drive on roads, but I don’t
get twenty-seven votes on Election Day. Neither does the fire department come to my house twenty-seven times faster, nor does the water flow out of my tap twenty-seven times hotter.

Now... doesn't that seem unfair?

The question is... if you're not paying any taxes to the government, should you get a vote at all? In other words, should non-stockholders of the corporation... in this case, a corporation which provides infrastructure, security, education and healthcare... have a say in who the CEO of that corporation is?

A person making 400,000 dollars a year will spend it. And in spending it, will contribute their fair share to the sales tax. It's a bit daft to want to make that much money and not spend it... but that's their problem.

When you're forced to pay a higher percentage of tax or just a higher income tax the richer you get, then... where's the incentive to work harder to make more money? We're not looking at people merely as earning workers... we're looking at them as being producers. The higher a person's income (usually... big CEOs are exempt from this law), the more they produce. The more they produce, the more products and services are available to other people, and the better the economy.

The better the economy, the more jobs there are. The more jobs there are, the lower the crime rate. It works.

People would be astounded at how great the lengths people are willing to go to to save money. However, your scenario does seem far-fetched, since they aren't buying illegal weapons, but I would imagine that with some tweaking (e.g. a goods store selling 'unregistered' products or something like that)...

So, you're all for introducing a controversial tax system and creating a massive, new bureaucracy to run an incredibly complex government regulation program Since it already is a problem to regulate firearms, I'm guessing that the regulation of goods is going to be...a lot more difficult?

People already cheat on taxes. What a sales tax does is ensure that they will pay for them in every transaction they make. If they don't, they don't, just like they don't, now. The bureacracy to enforce a sales tax is already in place... in addition to the bureacracy to enforce an income tax... which is infinitely more complex... you have nearly 200 million income earners versus how many businesses?

I'd prefer a sales tax to an income tax as long as the sales tax on food is low enough not to hurt the average income earner. It'll hurt some people, which is harsh, but let's look at how it is now:

Under income tax, you are rewarded for not producing goods. If you do not produce [b ]x[/b] amount of work, you pay no tax. If you, in addition, produce n number of extra consumers, you pay less taxes.

Under the income tax system, you are rewarded for producing less and consuming more.

Under a sales tax system, you are rewarded for consuming less. You eat less, you pay less taxes. You are also rewarded for making more money (i.e.: producing more)... you have higher income, you get to keep it.

Harsh for those with big families... but if you don't have the money to pay for your own upkeep, why do you produce more? I know of people who make babies merely to collect welfare.

Now, I don't know what your views on rich people are... that they produce money merely to squirrel it away... but eventually, most rich people either spend their money on luxuries... buying multi-million dollar condominiums and luxury yachts will pay the government hundreds of thousands in taxes... they spend it on power lunches, hotel rooms and caviar. Now, caviar, you can get on the black market, but a night at a beach resort?

Or, if they are so frugal that they eventually squirrel away billions of dollars in savings, they go on a philantrophic spree when they reach a certain age, and give away that money to schools, hospitals, the poor, etcetera.

A sales tax works. It hurts, but it works better than anything else.

 

[FoolKiller]

Ah, so he could've bought the same Rabbit you did, and bought practically the same house you did too.

Could have, yes. But did he? People with lots of money tend to spend lots of money, because they can.

You don't think that there is a person in high-class society who favours wearing casual rather than 'custom-made suits'? You don't think that there is a person in high-class society will enjoy a simple cheeseburger from a McDonald's?

They exist. My neighbor owns multiple gyms in my home town but is a t-shirt and jeans kind of guy. And judging by his stomach he enjoys quite a few burgers. But he also has a much larger house than I do with a tennis court, in-ground pool, his own landscaping equipment, etc. He also has one expensive SUV and then smaller, cheaper cars like VW Beetles, but he has something like five cars.

Well, mind enlightening me on what they are? Are you implying that you want to privatise defence, healthcare and education (cancel the odd one that the government does pay). If you had it your way, would you prefer that the government not pay for all three?

I suggest you check the US Constitution. http://tinyurl.com/djt3fj Article 1 Section 8 will explain how taxes are to be done:

Section 8. The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States;

So, of the three things you listed, healthcare, education, and defense, only defense is stated in the US Constitution. Because we have abandoned the Constitution a while back we now pay for most education before college as well. Healthcare is not directly paid for, but rather just somewhat helped, in that people without the ability to pay cannot be turned away and receive government money and programs.

But as Danoff's idea is to get back to how the Constitution said the country was supposed to work then I would assume education would be slowly worked out and return to the private system it was nearly 100 years ago.

And the part I highlighted in red explains the bit about how discriminating based on pay is not allowed, because they should all be uniform.

You cannot compare everyday jobs to black market goods.

Why not? Millions of illegal immigrants do it every day, and some people do perform jobs for cash under the table. Those people are not covered by the employer's insurance and their involvement is not listed on the books anywhere.

I can compare it because it happens now, but not to this huge degree you make it seem like daily items would under a sales tax.

You are trying to ignore for the amount of crime that a national sales tax would bring as well.

I'm not ignoring it, I am saying it would be unlikely to happen. You cannot prove it would happen by anything other than conjecture.

I, on the other hand, am happy to direct you toward a list of states which do not have a state personal income tax, and their other sources of revenue have not turned into some large crime plagued systems.
http://en.wikipedia.org/wiki/State_income_tax#U.S._States_without_a_personal_income_tax

Under the U.S. tax system, a person earning $400,000 a year pays about twenty-seven times the national average in income tax. Assuming that if I were to have that kind of earning capability, I would pay my fair share, and the fair share of twenty-six other
people. I’m happy to ‘cause that’s the only way it’s going work, and it’s in my
best interest that everybody be able to go to schools and drive on roads, but I don’t
get twenty-seven votes on Election Day. Neither does the fire department come to my house twenty-seven times faster, nor does the water flow out of my tap twenty-seven times hotter.

And we are saying we disagree with the current US tax system. So, quoting it to us does absolutely nothing. The current US tax system discriminates against success.

People would be astounded at how great the lengths people are willing to go to to save money. However, your scenario does seem far-fetched, since they aren't buying illegal weapons, but I would imagine that with some tweaking (e.g. a goods store selling 'unregistered' products or something like that)...

So, you are thinking of some storefront selling black market groceries? It takes effort to find black market movies and games in the US without going online.

The only way I can see your scenario happening is through an online marketplace, but then no one will buy perishable items, like food, through that. Sure, I can buy fake brand name clothes on the street corner in New York City or online, but they fall apart quickly and the people that really do care about brand names will laugh at you.

As consumer based as the US is I honestly believe that the overall effect would be minimal. Your arguments sound similar to those of the opponents of smoking bans and tobacco taxes. They claim it will kill the business in bars and cause black market goods. The bars were busy as ever a couple of months later and the closest thing to black market cigarettes that has happened is buying them from other states with lower taxes. (Note: I am not saying I agree with bans or sin taxes.)

There is no precedent for your scenario.

So, you're all for introducing a controversial tax system and creating a massive, new bureaucracy to run an incredibly complex government regulation program Since it already is a problem to regulate firearms, I'm guessing that the regulation of goods is going to be...a lot more difficult?

Introducing a controversial tax system? Considering our current tax system required an actual change to the US Constitution (check the 16th Amendment while you are reading up on it) I don't think going back to what the founders of our country intended would be too controversial from a legal stand point. Sure, people would have a hard time accepting the change, but fixing something always hurts.

What added bureaucracy and regulation would there be from what we have now? A 1,000+ page tax code that every citizen has to properly follow, or one that only the accountants for retail businesses, which already do this now, would have to understand? And I assume you mean regulating these black market groceries and clothing that you are talking about. That cannot even compare to guns, which have varying legal statuses based on their functionality, and waiting periods and background checks, and a few other things that do not apply to everyday goods.

Guns have a huge thing with them because the purpose of buying one illegally is mainly to use it for illegal actions. People are going to great means to make sure they can kill someone else without being caught. People are not going to go that far out of their way to buy food in a way that allows them to cheat taxes.

 

[Omnis]

Could have, yes. But did he? People with lots of money tend to spend lots of money, because they can.

This can be seen as a fallacy without elaboration. Yes, they might spend money, but what money and in what way? Let's take Jim Rodgers... He spends money-- federal reserve notes-- on commodities (onto which he holds). But Jim is not consuming. He is transfering the medium of his capital, not depleting his savings. So, rich people like Jim actually do very little (or at least average) consumer spending, even if they could spend very much. Hence, they remain wealthy.

This doesn't apply to just the rich, but to everyone. Bushpublicans and democrats-- all Keynesians-- seem to be confused about this. Consumer spending never grows wealth. When you artificially expand credit without adequate savings to support it, you create an unsustainable encouragement of consumer spending and ultimately have a bust such as the one we are experiencing.

The sales tax applies to consumer goods (spending on consumption) and not to savings (spending on production) as I understand it. It would be a good way to re-encourage savings and help undo the insanity that these past few congresses have put upon us.

 

[FoolKiller]

The sales tax applies to consumer goods (spending on consumption) and not to savings (spending on production) as I understand it. It would be a good way to re-encourage savings and help undo the insanity that these past few congresses have put upon us.

Dang it!!! You just found a tax shelter and helped his argument. A sales tax would encourage a rash of unacceptable saving. That is completely unacceptable. [/sarcasm]


But seriously, are you going to say that he doesn't have a nice car, house, and buy food and clothes that are probably more expensive than what I buy? I think you are confusing his "profession" spending, investing in commodities (doesn't he even have, or had, his own commodities index?), with his consumer spending. I mean, I put a big chunk of my paycheck into my 401k, tax free, but no one is arguing that I am not contributing because of it.

And we are talking about the same Jim Rogers, Adventure Capitalist and Investment Biker? If so, I am pretty sure the sales tax on this would have been quite hefty:

 

[Danoff]

This can be seen as a fallacy without elaboration. Yes, they might spend money, but what money and in what way? Let's take Jim Rodgers... He spends money-- federal reserve notes-- on commodities (onto which he holds). But Jim is not consuming. He is transfering the medium of his capital, not depleting his savings. So, rich people like Jim actually do very little (or at least average) consumer spending, even if they could spend very much. Hence, they remain wealthy.

Even transforming wealth can be a form of consumption - depending on what you transform it into. For example, if you build a house, you have transformed your wealth into a house. The house isn't necessarily worth any less than what you paid for it - but to create it you had to pay someone to provide the materials and labor to construct it. The same could be said of an exotic car.

Rich people spend a great deal more than poor people on everything from food to clothing to private jets. They may not lose much money on these items (the car is a collectible, the jet holds its value, etc.) but they certainly would generate a substantial tax revenue and are contributing to the economy.

In theory every single transaction in the free market is a transformation of currency into a product of the same worth.

 

[Omnis]

Dang it!!! You just found a tax shelter and helped his argument. A sales tax would encourage a rash of unacceptable saving. That is completely unacceptable. [/sarcasm]


But seriously, are you going to say that he doesn't have a nice car, house, and buy food and clothes that are probably more expensive than what I buy? I think you are confusing his "profession" spending, investing in commodities (doesn't he even have, or had, his own commodities index?), with his consumer spending. I mean, I put a big chunk of my paycheck into my 401k, tax free, but no one is arguing that I am not contributing because of it.

And we are talking about the same Jim Rogers, Adventure Capitalist and Investment Biker? If so, I am pretty sure the sales tax on this would have been quite hefty:

No, I'm not saying that. I was trying to illustrate productive spending in contrast to consumer spending. As you point out, he does (or at least did) spend quite a lot on consumption. The important point is that he still spends very little on consumption compared to his much greater amount of savings. That's why he hasn't gone the way of MC Hammer. I'm sure there are better examples than him. Heron can read the link in my sig for the best info.

Even transforming wealth can be a form of consumption - depending on what you transform it into. For example, if you build a house, you have transformed your wealth into a house. The house isn't necessarily worth any less than what you paid for it - but to create it you had to pay someone to provide the materials and labor to construct it. The same could be said of an exotic car.

Rich people spend a great deal more than poor people on everything from food to clothing to private jets. They may not lose much money on these items (the car is a collectible, the jet holds its value, etc.) but they certainly would generate a substantial tax revenue and are contributing to the economy.

In theory every single transaction in the free market is a transformation of currency into a product of the same worth.

These are all consumer products, though (unless the jet is to be an air-taxi). If you're spending on capital that has productive value, it's not a form of consumption.

 

[Indigo Heron]

I appreciate all the vibrant discussion going on, but we're deviating from the topic at hand. I still stand firm in my beliefs that the income tax is a fairer tax than the sales tax. No amount of convincing is going to shake my resolution, and I'm sure none will for yours as well.

Eventually, my argument will come down to 'government can't pay for the little things that make the country (any country) go round', so yeah...

 

[nk4e]

I was reminded of this song:

 

[Keef]

I just today learned about this Fairtax thing. In fact, I should have learned about it Wednesday, assuming this rally at Atlanta I'm watching on Hannity right now is a rerun.

 

[jonboy1066]

If I were Prime Minister of Britian I would start with:

Stop paying Dole money
to the long term unemployed and replace cash with Vouchers, these vouchers can only be used to pay for essential items like Food, and Bill paying such as rent, heating and water rates, the vouchers cannot be redeemed non essential luxury items such as Cigarettes, Alcohol and non essential electrical items such as TV's DVDs etc. You want luxuries, take aways and electrical goods, go out, get a job, earn some money, pay some tax and buy them yourself.

Introduce means testing and liscensing for the owning of pets
If you are unemployed and drawing dole "Vouchers" how can you afford to keep a dog or cat in food and vets bills? and why should the tax payer foot the bill for your pet?

Stop this culture amongst the unemployed of having more children to get more allowances and a bigger council house
The tax payers in full time employment tend to hang on until their mid twenties to mid thirties before having children then tend to stop at two kids before getting back to work, we have a new culture where a life on benefit is a lifestyle choice rather than a saftey net, these people are choosing to breed and starting to have babies at 16 or younger, then don't stop until they have had more than 5 and got a nice big house in the suburbs, those 5 kids then make the same choice to breed early and have another 5 kids each while staying jobless and not contribute to society at all.
I can see Britian in the next 20 years only having about 5% of the population working and paying tax while we are out numbered by those who have made the choice to stay out of work and be subsidised by the tax payer.
So I'd bring back the council estates and stop the new law where 25% of any new housing developments has to have housing for those on benefit, then issue a standard 2 up 2 down prefbricated house for those on benefit.

House too small for you?........Stop breeding!

Life a bit uncomfortable?.........Get a job, pay tax and buy your own house in which you can fit as many sprogs as you like!

Sort out the prisons
Refurb all prisons to make all cells solitary confinement small rooms and remove any rights from prisoners, only giving them sustanance and medical supplies if they are prescribed, for the duration of their stay. These days prisons have become more like a social club and a place for networking between criminals, some of them actually find prison more comfortable than the real world. By making all prison stays solitary the terms will be shorter and the crims will have a greater desire to stay away in future.

Withdraw all of our troops from all theatres of operation in the middle east and bring them all home
We (as a country) have got enough on our plate without joining in and wasting our countries money and soldiers lives on other peoples illegal wars, the British Forces needs to concentrate it's resources on British interests not wasting it's time fighting an unwinnable war for an ungrateful "Friend"


Sort out Illigal immigrants
By returning all who arrive illigaly back to the country from which they originally came, if they won't divulge their own country of origin then lock 'em up in my new solitary confinement prisons until such time as they do admit where they came from. Word will soon pass around that Britian has become less of a pushover than it was and the illegals will stop wanting to come in and scrounge from us this will also shut down a lot of the Mafia types who are smuggling the illigals into GB in the first place and forcing the immigrants into a world of crime to pay for thier safe passage..

Take all of the MP's involved in this latest expenses scandall, sack them all and prosecute them all for fraud

I could go on all night but think those are some good places to start

 

[Northstar]

How about this whole sales tax be a little lower than 30%, and how about we make the fuel tax variable in a way that it would keep the price of a gallon of gas at $3.00 a gallon or so. This would be my stealth protest against the Dodge Ram, the Dodge Ram 4x4, the Silverado Crew Cab HD, the Expedition, the F150, and the Sequoia (a Toyota in Dayton..who'da thunk it) that I was surrounded by on either end in my recent trip to the Sonic drive through. The Sonic is delicious, but it would have been even more delicious if it wasn't tainted with Appalachian American exhaust fumes.

Just for emphasis, I'll have you all know that those trucks were all occupied by one person, all had what appeared to be empty beds and interiors, none of them were towing a trailer, the roads are dry and therefore none of them needed 4WD, and they were all idling their enormous V8s the whole time we were sitting there waiting through Sonic's technical difficulties.

/rant.

Oh, and I would expect better quality roads from this tax hike, of course. Maybe something at half the standard of typical German autobahn.

So if someone owns a truck or SUV it has to be full all the time?

Also, all cars have the same fumes, American cars don't have more toxic fumes. If you despise what this country makes so much go to Canada.