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Old 12-12-2019, 04:08 PM
 
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Quote:
Originally Posted by kettlepot View Post
Sales taxes are a way to tax those who earn their income in the underground economy and would otherwise go mostly untaxed.

Sales taxes may be a disincentive to spending, but most economists worry about disincentives to saving.
Maybe a little bit, in things like gas and food. But for tools of the trade (whichever illicit dealings they may be involved) they're probably stolen or bought from a place that neither charges nor pays taxes.
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Old 12-12-2019, 05:01 PM
 
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Quote:
Originally Posted by splattenburgers View Post
For one thing the term sales tax (or VAT in case you are living somewhere that uses that instead) is misleading. Yes it's technically collected when buying something rather than being taken of your salary/income directly but in the end you are still using your salary/income to actually pay the tax. This means that in a way taxing sales/consumption is actually just a dumb way to tax somebody's income.
So I get your point that it disincentivizes sales. But what's the big deal? Numbers can be moved around, and taxes paid may or may not be transparent when purchasing any one particular good or commodity. Gasoline... you have to look for the sticker that shows how many cents per gallon go to tax. There's not a separate line item on your receipt or at the pump.

"Objectively inferior" - in what respect? Do you think that the collection of tax at point-of-sale is too far detached from payroll, from the time it is earned? Is there an inherent problem with not being taxed on the money you don't spend?

The degree (and positioning) of the "detachment" or deficiency you speak of can be unilateral or bilateral:

1.) Tax sales (or not some things, or not at all).
2.) Tax income (or not some things, or not at all). Is employee offered pre-tax 401k/IRA automatic draft, or must the individual be responsible for contributing with post-tax dollars, to receive a deduction come tax time?

Entertaining your argument, do you see a problem with people holding onto tax-free cash that was neither spent (thus taxed) nor socked away into a restricted retirement vehicle (destined to be taxed once it comes out, age-restricted, mandatory distributions thus mandatory tax...)
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Old 12-12-2019, 07:02 PM
Status: "I accept science. I reject populist nationalism." (set 22 days ago)
 
6,484 posts, read 2,367,647 times
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Quote:
Originally Posted by splattenburgers View Post
For one thing the term sales tax (or VAT in case you are living somewhere that uses that instead) is misleading. Yes it's technically collected when buying something rather than being taken of your salary/income directly but in the end you are still using your salary/income to actually pay the tax. This means that in a way taxing sales/consumption is actually just a dumb way to tax somebody's income.

Your logic only works if you live paycheck to paycheck. What if you buy something out of your savings account, money that's been sitting there for years? With your logic, the sales tax is really a wealth tax, not income tax.


Sales taxes are inferior, mainly because they are regressive and hurt the poor far more than the wealthy.
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Old 12-12-2019, 07:31 PM
 
Location: Nebraska
4,332 posts, read 7,435,469 times
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Quote:
Originally Posted by splattenburgers View Post
For one thing the term sales tax (or VAT in case you are living somewhere that uses that instead) is misleading. Yes it's technically collected when buying something rather than being taken of your salary/income directly but in the end you are still using your salary/income to actually pay the tax. This means that in a way taxing sales/consumption is actually just a dumb way to tax somebody's income.



Secondly sales/consumption taxes have a greater chance of harming the economy compared to income taxes since they de-incentivize spending money on goods while also possibly having other unwanted side effects such as discouraging tourism.


You can debate how high or low income taxes should be but in any case I would argue that sales taxes are nonsense regardless of if one desires high or low taxes.



Actually, I would argue that ALL taxes in general except the income tax is stupid. If I could I would just instate a flat 50% income tax and then get rid of all other taxes except maybe certain kinds of tariffs.
A sales tax is less likely to be evaded than an INCOME tax. Why do we work for a wage? So we can BUY things. Being forced to pay an income tax PI**ES everyone off. AND FORCE is used to collect income tax. The worst thing would be having BOTH a VAT and an INCOME tax.
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Old 12-12-2019, 10:39 PM
 
1,986 posts, read 747,186 times
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Quote:
Originally Posted by GreggT View Post
Duh!!!



Not disingenuous at all. State taxes go for different things than Federal Incomes, they are not all thrown in one pot!
Exactly! So when you say that they don't contribute at all, you absolutely incorrect and from a narrative of ignorance. A common occurrence among foreigners.
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Old 12-13-2019, 01:28 AM
 
3,010 posts, read 1,970,038 times
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My goodness.

Let’s say my state has tons of outside summer tourism for its thousands of lakes, some of them Great Lakes. These visitors don’t work or earn any income in my state what so ever. How do I tax them? A state sales tax on consumption.

The state is passing a portion of its revenue collection to outsiders.

Let’s say my state is a cross roads state, say THE crossroads state of Indiana. Or maybe Ohio. Millions of people just passing thru. How do I tax them as a state? Income tax? Nope.

Or let’s say I’m an income tax free state with a certain desert city people like to visit. Or another one that’s a swampy state full of retirees who might not have tons of earned w2 income.

Voters in my state...do you want to pay a 12 percent income tax to fund our operations? No? Ok. Do you want to pass tax burden onto people who can’t vote in our state while lowering your overall burden to have our state function? Yes! Heres your 7 percent sales tax.

Wow that was hard to prove that income taxes aren’t “objectively” better for a state to raise revenue.

Last edited by Thatsright19; 12-13-2019 at 01:56 AM..
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Old 12-13-2019, 04:24 AM
 
15,567 posts, read 8,390,475 times
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Quote:
Originally Posted by Gunluvver2 View Post
A sales tax is less likely to be evaded than an INCOME tax. Why do we work for a wage? So we can BUY things. Being forced to pay an income tax PI**ES everyone off. AND FORCE is used to collect income tax. The worst thing would be having BOTH a VAT and an INCOME tax.
I evade sales tax all the time. I’m spread around several New England states. If I have a large purchase, I do it in New Hampshire to avoid the tax. I’ll be there next Wednesday picking up a $6,000 purchase. It doesn’t work for cars and boats that need to be registered and it’s not worth it for small items. My Vermont place at the ski resort is 30 miles from NH. It’s not like it’s any big deal since I’m driving through NH frequently.
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Old 12-13-2019, 05:46 AM
 
3,010 posts, read 1,970,038 times
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Quote:
Originally Posted by GeoffD View Post
I evade sales tax all the time. I’m spread around several New England states. If I have a large purchase, I do it in New Hampshire to avoid the tax. I’ll be there next Wednesday picking up a $6,000 purchase. It doesn’t work for cars and boats that need to be registered and it’s not worth it for small items. My Vermont place at the ski resort is 30 miles from NH. It’s not like it’s any big deal since I’m driving through NH frequently.
Avoid or evade?

Does your state have a self reported use tax? There’s a reason it’s generally referred to as sales and use tax.

I wouldn’t brag about evading taxes so publicly.
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Old 12-13-2019, 09:32 AM
 
15,567 posts, read 8,390,475 times
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Quote:
Originally Posted by Thatsright19 View Post
Avoid or evade?

Does your state have a self reported use tax? There’s a reason it’s generally referred to as sales and use tax.

I wouldn’t brag about evading taxes so publicly.

Come find me.
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Old 12-13-2019, 11:38 AM
 
3,010 posts, read 1,970,038 times
Reputation: 6784
Quote:
Originally Posted by GeoffD View Post
Come find me.
Meh
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