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Post by supposn1 on Jul 26, 2014 15:36:56 GMT -6
Sales taxes are generally drafted as flat rated taxes. They are not integrally regressive but are COMPARATIVELY more regressive than progressive income taxes whose rates are incrementally increased in step with taxpayers’ taxable incomes.
USA’s income taxes are not nearly as progressive as conservatives would have us believe. The many loop holes and exceptions within USA’s IRS regulations, (i.e. special strokes for special folks) greatly reduce our income taxes’ progressive character. USA’s income taxes are not as progressive as conservative factions would wish us to believe; reducing federal income taxes by a uniform rate of taxable incomes and revenue neutrally replacing lost revenues with a general sales tax would not in aggregate be as regressive as we are being led to believe.
I particular advocate replacing half of FICA’s social security retirement and disability funding, and FICA’s entire Medicare funding with a tax based upon general sales transactions.
If both employees and employers FICA taxes were each reduced by 5% of payroll and replaced with a tax of 5% upon general sales transactions, net tax revenue would not be reduced and possibly be increased to cover the soon to be expected social security retirement and disability’s short fall. Due to the reduction of FICA taxes imbeded within the prices of all goods and services, (including government fees and services which are not generally subject to any sales taxes), USA’s working poor may experience a decrease and certainly not an increase of their incomes’ proportion they directly and indirectly pay for FICA.
FICA is the most regressive of federal taxes.
Respectfully, Supposn
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Post by supposn1 on Jul 26, 2014 18:01:13 GMT -6
Within another thread, Unlawflcombatnt wrote”:
”VATs”, (i.e. a sales tax method that most economists believe to be a superior administering method has not been enacted anywhere within the USA), will “ … ultimately reduce the price of US goods in export markets, the aggregate size of those markets available to American exports pales in comparison to the US consumer market. As such, VATs will hurt American producers. VATs will reduce domestic demand far more than they'll increase export demand. VATs are a very bad idea for the U.S.”.
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Comparative to taxes levied upon other bases, the consequences of general sales taxes are of much lesser reduction of the tax’s base.
For example we do not doubt during World War Two the consequences of confiscational income tax rates severely reduced reported personal income, entrepreneurs and corporate executives were enjoying the luxury of support for their expense account existence. There are innumerable methods to understate net enterprises’ or individuals’ incomes.
Sales taxes are based upon gross rather than net sales revenues. To the extent that a general sales tax is applicable to most goods and services, and to the extent that tax is enforced, there’s less opportunity to evade a general sales tax.
Although it’s conceivable that USA could replace all income taxes with a federal sales tax, I do not believe it’s feasible. I do not believe that the U.S. Congress would be so imprudent as to attempt transferring our major revenue source from taxes upon net incomes to a tax upon general gross sales in a single huge step. If such transformation is ever attempted, I believe it would as it should be done incrementally. Additionally I believe that after one of the incremental steps the sales tax would approach an unacceptable rate which will interrupt further transforming steps.
Respectfully, Supposn
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Post by unlawflcombatnt on Jul 26, 2014 22:32:43 GMT -6
Within another thread, Unlawflcombatnt wrote”: ”VATs”, (i.e. a sales tax method that most economists believe to be a superior administering method has not been enacted anywhere within the USA), will “ … ultimately reduce the price of US goods in export markets, the aggregate size of those markets available to American exports pales in comparison to the US consumer market. As such, VATs will hurt American producers. VATs will reduce domestic demand far more than they'll increase export demand. VATs are a very bad idea for the U.S.”. /////////////////// Comparative to taxes levied upon other bases, the consequences of general sales taxes are of much lesser reduction of the tax’s base.... Respectfully, Supposn I'm going to have to go at this 1 part at a time.
The argument about "taxes" is not all about increasing tax revenue.
It's about putting them where they'll do the least amount of economic damage.
In a country where markets are swimming in investment capital (provided by, and available to the richest predominantly), there's no justification for disproportionately reducing taxes on those rich capital providers, while disproportionately increasing the tax burden on the non-rich consumers who provide the lion's share of production demand.
And that's exactly what shifting the tax burden to sales taxes from income taxes will do. It'll deprive the non-rich, high marginal-propensity-to-consume consumers of buying power by raising the after-tax price of goods. Reducing their buying power reduces production demand--along with the investment demand created by that production demand. The result is that there'll be even less productive investment opportunities for an already-overabundant amount of investment capital.
Meanwhile, it'll increase the after-tax income of the "investor-class", who already have more capital than they know what to do with. And will have little effect on their actual purchasing and subsequent production demand creation, due to their already-reduced marginal-propensity-to-consume (compared to the less affluent.) Allowing the more affluent to keep more of their income due to reduced aggregate taxation, from an income tax-to-sales tax shift, is not a net benefit.
There's simply no economic justification for replacing progressive income taxes with regressive sales taxes.
The exact opposite is true. Increasing the tax rates on the top earners will have little negative effect due an already-excessive amount of available investment capital--and may even be beneficial by reducing mal-investment of that excess.
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Post by supposn1 on Jul 29, 2014 3:16:35 GMT -6
Unlawflcombatnt, liberals’ contend Medicare, Social Security retirement and disability, (i.e. social welfare) programs are economic net benefits to our entire nation,
Conservatives believe that it’s a drain upon our economy to benefit those that “do not fully contribute to our nation’s tax revenues and are net economic detriments to our nation. Tea Party partisans may very well succeed to reduce social programs’ benefits as the price they’ll extort for patching, (but not resolving) FICA’s eminent financial short fall, Conservative long term strategy is the elimination of those social welfare programs.
It would be more feasible to achieve sufficient funding for those particular social programs by enacting a federal sales tax rather than by funding those entitlements through our general federal budget. It is not your preference but I suppose you’d rather transform some of FICA’s tax revenues from a payroll tax to a sales tax rather than accept the reduction and the possible elimination of the programs that are currently dependent upon FICA payroll tax revenue funding.
Would you and others of opinions similar to yours be extremely uncomfortable to refrain from overt objecting to transforming some of the FICA payroll tax to be replaced by a general sales tax?
I would hope that if that transformation were enacted, we all could experience and appreciate the’ benefits of a federal sales tax or fully recognize its inferior characteristics.
Let’s take proposed transformation from income taxes to sales taxes off of the table until a federal sales tax has been enacted and we’ve had sufficient time to experience its economic affects upon our nation.
Respectfully, Supposn
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Post by supposn1 on Jul 29, 2014 3:17:11 GMT -6
Unlawflcombatnt, liberals’ contend Medicare, Social Security retirement and disability, (i.e. social welfare) programs are economic net benefits to our entire nation,
Conservatives believe that it’s a drain upon our economy to benefit those that “do not fully contribute to our nation’s tax revenues and are net economic detriments to our nation. Tea Party partisans may very well succeed to reduce social programs’ benefits as the price they’ll extort for patching, (but not resolving) FICA’s eminent financial short fall, Conservative long term strategy is the elimination of those social welfare programs.
It would be more feasible to achieve sufficient funding for those particular social programs by enacting a federal sales tax rather than by funding those entitlements through our general federal budget. It is not your preference but I suppose you’d rather transform some of FICA’s tax revenues from a payroll tax to a sales tax rather than accept the reduction and the possible elimination of the programs that are currently dependent upon FICA payroll tax revenue funding.
Would you and others of opinions similar to yours be extremely uncomfortable to refrain from overt objecting to transforming some of the FICA payroll tax to be replaced by a general sales tax?
I would hope that if that transformation were enacted, we all could experience and appreciate the’ benefits of a federal sales tax or fully recognize its inferior characteristics.
Let’s take proposed transformation from income taxes to sales taxes off of the table until a federal sales tax has been enacted and we’ve had sufficient time to experience its economic affects upon our nation.
Respectfully, Supposn
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Post by supposn1 on Oct 5, 2014 17:58:57 GMT -6
I’m opposed to eliminating corporate taxes because it would encourage the return of the expense account society of World War Two. If personal net incomes are taxed at a greater than corporates’ rates, we will re-experience the prevalent tax evasion practiced by our expense account society during of World War Two. To the extent that we retain the taxing of net incomes, both individual and corporate incomes should be taxed at rates that are reasonably equitable to each other. I’m advocate of expanding the Earned Income credit provisions of IRS income tax regulations and (to the greatest extent feasible) replacing the taxes upon the lowest earning individuals with a federal sales. Sales taxes can be (to a very limited extent) be drafted to be effectively somewhat more progressive than a purely flat tax rate). There’s no such thing as a “fair” tax but this transfer of tax revenue sources would effective, equitably and simply tax continue taxing individuals’ and corporations’ net incomes while reducing their income tax rates. I’m an advocate of replacing the individuals’ $3900 per capita reduction of taxable incomes to be replaced with a revenue neutural tax credit amount that’s anually udated to stay abreast with the U.S. dollar’s purchasing power. The federal government should not be granting more per capita amounts of tax considerations to wealthier earning taxpayers and their dependents. Refer to unlawflcombatnt.proboards.com/thread/13804/sales-taxes I’m opposed to “special strokes for special folks”; the differentiating between sources of incomes or the manner the incomes were accquired. Corporations dispersements of dividends should reduce their taxable incomes and 25% of earners’ dividends should be taxes withheld; In the cases where the individual or corporate taxpayers receive their dividends just prior to the end of fiscal quarters, the taxpayers could almost immediately file to reclaim refunds for their excess income taxes paid. I’m opposed to the unjustified tax reduction granted to long term capital gains incomes. Refer to the thread Capital gains tax and tax averaging methods for reducing taxable incomes. I’m proponent for entirely eliminating the FICA payroll taxes funding of Medicare, and half of Social Securities’ long term disabilities and retirement programs. FICA is the most regressive tax that of extremely greater burden to lesser earning employees. Refer to unlawflcombatnt.proboards.com/thread/13650/fica-payroll-tax-most-regressive These are among the measures that could reduce both individuals’ and corporate tax rates, equitably retain federal tax revenues and be of lesser net burden to the working poor and social security retirees. To the extent that enterprise’s taxes upon net incomes are reduced, we would be reducing incentives for USA enterprises to be expatriated. Respectfully, Supposn
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