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Ok. I disagree. ...Personally, I’d only exempt (from sales tax) “healthy” food. Soda, junk carbs, or convenience foods? Tax away.
GeoffD, the purpose of a tax is to provide sufficient net tax revenue. It's important and politically difficult that we refrain from waiving the sales tax upon too many items or purchasers.
I would prefer that sales tax be waived upon food that's not provided by restaurants or caterers; even purchases from McDonald should be subject to sales tax.
The dollar amounts of sales tax waivers upon rents per residential units, and/or specified utilities delivered to each residential unit should be “capped”. The caps should be dollar's per month and the caps should be subject to annual cost of living adjustments, (COLAs). An alternative to capping dollars per month, could be units of specific utility products per month. There's no need to COLA capped quantities of utility products delivered to residences within the government;s jurisdiction.
“Sin taxes” are employed to discourage purchases of items identified as troublesome or items that induce generally greater government expenditures. For example gasoline taxes help fund repair and building of roads, proponents of tobacco and alcohol taxes cite the addictive nature of the products that are consequentially detrimental to public health and/or of great public costs to the government. Otherwise I'm generally opposed to government determining which products' sales, government should or should not discourage.
The debate surrounding "regressive" taxes usually ignores the elephant in the room- LIFE is regressive. A bag of groceries is a much higher percentage of a poor family's income (or overall wealth) vs a rich family. The same is true for gas, education, clothing, housing, healthcare, and all other aspects of life.
Why are we trying to solve the world's inequality through the tax code?
The debate surrounding "regressive" taxes usually ignores the elephant in the room- LIFE is regressive. A bag of groceries is a much higher percentage of a poor family's income (or overall wealth) vs a rich family. The same is true for gas, education, clothing, housing, healthcare, and all other aspects of life.
Why are we trying to solve the world's inequality through the tax code?
I've been saying that for years - life is regressive, so taxes should not exacerbate the regressivity of life.
Turns out George Will beat me to it - "Life is regressive" - by some years but he doesn't appear concerned with regressive taxes.
In that context, it should be clear that government CAN at least not make life more regressive, even if it cannot solve inequality.
Ok. I disagree. Social Security payout is massively progressive. I pay twice as much into the system as somebody making $60k in 2017 dollars. My Social Security check will only be 15% higher. Social Security is a pension system based on a very fair “everybody contributes” model. I have no issue with the progressive nature of Social Security payouts but the program is highly progressive and the most successful social program in US history. If you don’t contribute, you don’t get a monthly check when you retire. Everyone has a stake in the system. That’s very different from Federal income taxes where half the country pays little or no tax. No stake. It’s easy to go Full Bernie handing out all that free stuff when you’re not paying for it.
At the state level, flat state income taxes and sales taxes are a huge control on state spending because everyone pays. If you fund everything with a steeply graduated income tax and an invisible steep corporate income tax, it’s only causing pain to a few people when you hike taxes.
I think the “everyone has a stake” is critical. With sales tax, exempt food and inexpensive clothing like most states do. If you want that $1,000 iPhone, you pay the sales tax. Personally, I’d only exempt “healthy” food. Soda, junk carbs, or convenience foods? Tax away.
The payout formula is progressive, but actual payouts might be regressive simply because longevity is regressive - the progressive payout formula is useless to low earners who disproportionately die before recovering that they paid into the system. Also, since low earners - especially men - have very low marriage rates, survivors' benefits are probably regressive.
I've been saying that for years - life is regressive, so taxes should not exacerbate the regressivity of life.
Turns out George Will beat me to it - "Life is regressive" - by some years but he doesn't appear concerned with regressive taxes.
In that context, it should be clear that government CAN at least not make life more regressive, even if it cannot solve inequality.
There is nothing wrong with anything being regressive. The moral outrage comes from when people get things for free on the backs of other people who had to give up resources to pay for that other person. Regressive taxes are much, much fairer than progressive taxes in that respect.
As a flat tax, FICA tax is neither regressive of progressive without its two great modifiers.
• The provision of a maximum wage base is highly regressive.
• But when considering one's lifetime contributions, the benefits are highly "progressive", with much higher percentages being returned to those of lower economic status. Those with less lifetime contributions receive a much higher return on investment than those with higher lifetime contributions.
The least benefit bang for the contribution buck goes to those at the maximum wage base. Not looking to argue right or wrong... it's just the way it is.
As a flat tax, FICA tax is neither regressive of progressive without its two great modifiers.
• The provision of a maximum wage base is highly regressive.
• But when considering one's lifetime contributions, the benefits are highly "progressive", with much higher percentages being returned to those of lower economic status. Those with less lifetime contributions receive a much higher return on investment than those with higher lifetime contributions.
The least benefit bang for the contribution buck goes to those at the maximum wage base. Not looking to argue right or wrong... it's just the way it is.
The payout formula is nominally progressive but that is useless to every low earner who dies before getting back the money they paid in.
About ten years ago I recall some conservatives were discussing how black men get shortchanged because of their shorter lifespans.
Don't forget that in a country where the government was instituted to secure endowed rights, no right can be subject to taxation. Ergo, all taxes are limited to government privileges.
And all taxes on income shift to the retail price, where the customer is the ultimate taxpayer. From where else does the money come from if not the customer?
So a poor person who spends all his money is paying the highest percentage of taxes embodied in the price tag for American made goods and services.
Of course, imports do not have as much tax shift inflation in their price, hence their lower price.
Frankly, if all excise taxes were abolished, American made goods and services would be far cheaper than foreign imports - especially if only import duties were the primary revenue stream. But when did government ever care about anything else but its own revenue and power?
Don't forget that in a country where the government was instituted to secure endowed rights, no right can be subject to taxation. Ergo, all taxes are limited to government privileges.
And all taxes on income shift to the retail price, where the customer is the ultimate taxpayer. From where else does the money come from if not the customer?
So a poor person who spends all his money is paying the highest percentage of taxes embodied in the price tag for American made goods and services.
Of course, imports do not have as much tax shift inflation in their price, hence their lower price.
Frankly, if all excise taxes were abolished, American made goods and services would be far cheaper than foreign imports - especially if only import duties were the primary revenue stream. But when did government ever care about anything else but its own revenue and power?
Why then do conservative say the poor don't pay enough tax?
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FICA Tax; regressive or progressive?
