[Goober5000]

Originally posted by redmenace
except now individuals now have to keep records to send to the IRS of what to write off.

No, individuals don't have to keep track of anything.  Only businesses.  And the records are really quite simple... when you're ringing up an item, you check the list to see if it's exempt.  If it is, no tax.  If it isn't, calculate and add the tax from the universal tax rate.

[Terminator]

Originally posted by Grey Wolf 2009
What do you want in their place? Tariffs again? The Federal Government is going to want to get money somehow...

LOL don't listen to my politics. I'm never serious when I talk about it.

[Grey Wolf]

It was primarily a reply to Terminator, for his comment about abolishing taxes. There are only about four ways for governments to make money:
1. Taxing what you already have (property tax)
2. Taxing what you are earning (income tax)
3. Taxing what you buy (sales tax)
4. Taxing what you import (tariff)

[Terminator]

The money system itself is obsolete. why? because the best stuff in life is open-source

[Kazan]

goober even with those exemptions the vast majority of the tax burdeon STILL goves on the lower and middle classes

econ 101 my friends

[Bobboau]

I didn't read any of the thread, I like the idea in general, in fact I have been wanting something along these lines for a while now, but I want to look into the details of it, it needs to have diferent classes of items with diferent rates, otherwise it's little more than a flat tax (wich I sort of like the theory behind, but don't consiter it practical). for example food should have little or no taxation on it, houses should have tax rated determined by the value of the property (and if the person/corperation has other properties) energy should probly be progresively taxed so there is an additional penalty for waisting it, and people who are poorer don't have to pay as much to heat there bedrooms.

[Goober5000]

Originally posted by Kazan
goober even with those exemptions the vast majority of the tax burdeon STILL goves on the lower and middle classes

econ 101 my friends

On the contrary... if they buy nothing but exempt goods, then they pay no taxes by definition.  Even with the current system, most of the tax burden has to come from the wealthier classes (upper class and mid-to-upper-middle class), because they're the ones with the money.

[redmenace]

But then the government would have their revenue directly related to actual sales of merchandise. This could bring a conflict of interest.

[Kazan]

Tax Burdeon is measured in EFFECT

under ANY sales tax system more of the burdeon is on the lower and middle classes - unless you exempt everything under 10,000 sticker price (and have exemption on automobilies and homes based upon income) -- but then you'll never bring in enough income

[Bobboau]

what if the tax wasn't linear, but some sort of geometric or exponental or logorithmic model based on price of the item?

[Kazan]

there is no way to make a sales tax non-regressive

sales taxes are, by nature, regressive

[Bobboau]

how so, from what I see the more you spend the more you pay, it can even be calabrated so that spending on luxuries costs you substantualy more than nesesities, wich the current tax system can only hope to aproximate.

if you buy a $200,000 dolar car you pay a $100,000 tax, if you buy an $8,000 car you pay a $200 tax

[Kazan]

it's burdeon bobboau -- burdeon

apply the law of dimishing returns to their income and figure out their equal dollars, it's pretty bloodly simple: it roally annoys me when people forget this simple freaking econ thing


they pay a higher percentage of their income, they page a higher number of equal dollars as well - so they're double ****ed


sales taxes are regressive taxes - period

[Goober5000]

Originally posted by Kazan
it's burdeon bobboau -- burdeon

You mean burden?

apply the law of dimishing returns to their income and figure out their equal dollars, it's pretty bloodly simple: it roally annoys me when people forget this simple freaking econ thing

Simpler than Bobboau's car example?  I doubt it, unless you can come up with an example of your own.  I've studied a fair bit of economics myself, and I haven't seen anything fairer than a national sales tax.

[StratComm]

I think the point is that a national sales tax could be applied fairly, but we all know that if the current government trys it will fail miserably.

[Zarax]

Oh, a sales tax.
Let's begin the evasion festival!
Let's clarify things a bit...
Here's how sales tax works in EU (i'll simplify the model a bit):
There are 4 classes of taxeable goods (and services of course):

1) Basic Food & Healthcare - no tax
2) Generic Food & Healthcare (plus health and education services) - 4% tax
3) There are some socially useful goods and services (IE school books + energy) that gets a "reduced" 10% tax
4) Most stuff gets the standard 20% tax

Where is the problem?
There is no way to make things really fair (everyone will have to buy items with the highest taxation, no matter how you want to put it...), as most everyday use items aren't life essential so they gets full taxation.
In addition to that evading taxes in part or in the whole is really much easier, especially for services where you cannot even track stored stuff.
Also, historically no government managed to survive only with sales taxes, not even by cutting most social services like school and healthcare.
EU uses VAT (or it's equivalent, the name changes from nation to nation) only to finance specific projects, leaving the main part of the spending funded by income taxes...
Oh, i forgot an "hidden tax", the ones that comes with interest rates which is around 27%, so you're taxed even when you get loans.

[Kazan]

goober5000 - then you must have slept through when they explained what equal dollars were


Sales taxes are REGRESSIVE - they hare more impact on the lower and middle classes, and they put more of the burden on lower and middle class


The fairest tax is the Tax on Equal Dollars aka A progressive tax

[Liberator]

Why does that sound like a Liberal economic principle to me?  I mean besides the fact that Kaz is being rabid about it.

[Kazan]

because EVERYTHING you don't like is liberal


let's do a little math here -- two peope make 10,000 in purchases i

let's say 3000 of the purchases made by both people are tax-exempt, so you have $7000 in taxable purchases

that's $8610 in taxable purchases _After_ tax (at 23%), making an effective tax percent (ETP) of 16.1% on their purchases

now say that person A makes 30,000/year, and person B makes 100,000/year

the ETP on their income for A is 5.3%
the ETP on their income for B is 1.61%

now - some people claim the principle "more wealthy people buy more expensive things more often", that assumption is FALSE.  The majority of individuals in the US with networths at or over $1m are very FRUGAL people, that's why their networth is so high (one of the respectable tv-news-journals ie like 20/20 did a report on this is in the late 90s... and i happen to remember seeing it ... but i forget which one)



----------------------------------

Now let's take the same Person A(Inc=30K), and same Person B(Inc=100K)

now let's say they both purchase Zap! Smart Cars because they have great gas milage.

Now a  Smart Car costs around $15,550 - after a 23% NST that's $19,065 after tax, or a total of $3565 in taxes.

that gives you ETP(A)=11.88%
and ETP(B)=3.565%

[Kazan]

im munching out some very difficult 30-year-mortgage math right now.. so it may be a little bit -- it's a RPITA