A better solution to the problems with property taxes (home, buy)

[ElijahAstin]

Originally Posted by hnsq

No...the tax would be fairly distributed based on the resources you consume. It is the only truly fair tax scheme.

That would be true if the rich consumed proportionately more goods and services than the poor, but they simply don't. Such a tax scheme would be patently regressive. Whether you find that fair or justifiable is another issue entirely.

[WhoIsStanwix?]

Originally Posted by HeavenWood

Given your absurdly high definition of "wealth," yes, you are correct. I think "wealth" begins with the lower reaches of the one percent, and plenty of families earning in the mid sixes through low sevens send their children to public schools.

I can agree with that. I define wealth as some amount of assets where you could live off of them (no interest, just drawing down the wealth), and still maintain an upper class lifestyle.

I guess I didn't realize that you could draw out 300k a year for 166 years on $50m. Yes, that's absurdly high. Maybe I'd revise to $10 mil, but what I was trying to get at was a definition where you were upper class but not income dependent.

The reason I used that definition vs any other is that my point on property taxes are that they're one of the few ways to tax those who don't have or don't need an income at the upper end.

[UKyank]

Originally Posted by HeavenWood

That would be true if the rich consumed proportionately more goods and services than the poor, but they simply don't. Such a tax scheme would be patently regressive. Whether you find that fair or justifiable is another issue entirely.

I would say the rich do in fact consume more goods overall, and definately more higher end goods that would produce a higher tax amount. I would only support such a system if the sales tax was excluded from necessities like PA does though.

That being said, you'd have to produce a lot of data to convince me that such a system would bring in adequate revenue to run the country without having a ridiculously high national sales tax rate.

[BrianTH]

Originally Posted by hnsq

No...the tax would be fairly distributed based on the resources you consume. It is the only truly fair tax scheme.

First, nothing you said justifies your "no"--you are just saying that a tax which has the highest rates for the lowest income people is your idea of "truly fair".

Second, you are descriptively wrong about how sales taxes work. Sales taxes, as a matter of definition, are collected at the point of sale. As a matter of law and practice, they can only be collected at points of sale within the jurisdiction of the taxing authority.

Accordingly, converting all local taxes in Allegheny County to a flat sales tax would NOT be a flat tax on all resources consumed in Allegheny County. It would ONLY be a flat tax on goods or services which were sold at a point within Allegheny County.

Note it is possible to create more comprehensive consumption taxes, but sales taxes specifically are definitely not comprehensive in the way you claimed.

[BrianTH]

Originally Posted by WhoIsStanwix?

The reason I used that definition vs any other is that my point on property taxes are that they're one of the few ways to tax those who don't have or don't need an income at the upper end.

I'd note again you need to distinguish income in general (which would include things like dividends and realized or perhaps unrealized capital gains) from wages. People of great wealth may not have wages, but they tend to have a lot of income of other sorts.

[Lobick]

An important, often overlooked consideration when considering replacing a property value based system of taxation for localities is the predictability of tax revenue. Property taxes work well for municipalities since the revenue they generate is predictably and constant, despite changes in economic climates. It allows for consistent, long-term budgeting.

I'm not suggesting that a new system could not be devised to ameliorate some of these concerns and address the other issues presented, but I think it's important to remember that this property tax system hasn't become the dominant one because it has no redeeming characteristics.

[ElijahAstin]

Originally Posted by UKyank

I would say the rich do in fact consume more goods overall, and definately more higher end goods that would produce a higher tax amount. I would only support such a system if the sales tax was excluded from necessities like PA does though.

That being said, you'd have to produce a lot of data to convince me that such a system would bring in adequate revenue to run the country without having a ridiculously high national sales tax rate.

They do consume more goods. They simply consume less proportionately. That's where the regressive part comes in.

[WhoIsStanwix?]

I will respectfully bow out of this one. There's no good way for me to articulate what I want to say, other than to say, I don't want to pay more taxes. It's inevitible, though, that I will either pay more taxes or make less money or both as I go forward.

I am one for more evenly and fairly distributing the tax burden. I have no idea how to do that. Sooooo complex

[hnsq]

Originally Posted by BrianTH

First, nothing you said justifies your "no"--you are just saying that a tax which has the highest rates for the lowest income people is your idea of "truly fair".

Second, you are descriptively wrong about how sales taxes work. Sales taxes, as a matter of definition, are collected at the point of sale. As a matter of law and practice, they can only be collected at points of sale within the jurisdiction of the taxing authority.

Accordingly, converting all local taxes in Allegheny County to a flat sales tax would NOT be a flat tax on all resources consumed in Allegheny County. It would ONLY be a flat tax on goods or services which were sold at a point within Allegheny County.

Note it is possible to create more comprehensive consumption taxes, but sales taxes specifically are definitely not comprehensive in the way you claimed.

With all due respect, I disagree. Fair is every person paying an equal share of the resources they use. Please indicate when I claimed that we should tax all resources consumed in Allegheny county. Taxing a person on the goods and services they purchase at the point in which they purchased them generates fair revenue for the jurisdiction in which it was purchased. It also eliminates the tax loopholes which are being taken advantage of, as well as eliminate a system of specific incomes propping up others. Everyone pays an equal percentage for what they use.

So, to say it again, a flat sales tax is the ONLY fair tax that can be determined.

Originally Posted by HeavenWood

That would be true if the rich consumed proportionately more goods and services than the poor, but they simply don't. Such a tax scheme would be patently regressive. Whether you find that fair or justifiable is another issue entirely.

If a millionare rents an apartment and only buys a single honda civic in a year, there is no justifiable reason for that millionare to pay more in net taxes than someone making $40k/year who lives in the same apartment building and drives the same honda civic.

[BrianTH]

Originally Posted by UKyank

I would say the rich do in fact consume more goods overall

They do, but as a lower percentage of their income. Hence a flat tax on the consumption of goods tends to take a lower and lower percentage of total income as total income increases.

By the way, some people will argue that all income eventually has to become consumption of some sort. That is sorta true depending on how you define things, but the general problem is that many sorts of "consumption" can fall outside of certain forms of consumption taxes. For example, one thing very wealthy people tend to do with their accumulated savings is just control things. So, for example, you might buy yourself a major league sports team, and get to tell it what to do. You could call that a form of consumption, but it is very difficult to tax in the way we can tax, say, the purchase of a boat.