Shouldn't We Have A Federal Sales Tax

[simple simon]

seems a federal sales tax would do away with so many problems and provide so much more money then the system we have now .... also seems it may be a little more fair then income taxes

i think we are missing out on a lot of money we could be getting from a federal sales tax when foreigners come to America and spend money here

it would also solve one of the problems of illegal aliens and people who work for pay 'under the table' ..... even babysitters and kids that mow lawns .... in this case we wouldnt have to worry that their income isnt taxed because we will collect the tax when they spend that money

*edit ..... forgot to add a key item this federal sales tax would also help us avoid .... seems fairly often you find out a rich person is being busted for income tax evasion .... that would obviously not be an issue with this plan

[another day]

A good idea but I think you'll find if there is ever a federal sales tax introduced, it will not be a replacement to the income tax, only an additional tax imposed. Also, you mention rich people evading income tax, but with this system, businesses (ie: rich people) will still evade the sales tax by misrepresenting their sales and keeping tax money, which actually comes straight from the citizens pockets, rather then just not paying their own money to the government.

[Milton Bradley]

Why would we want this government to have more money?

[Stizzles]

Quote by: another day A good idea but I think you'll find if there is ever a federal sales tax introduced, it will not be a replacement to the income tax, only an additional tax imposed.

Where has there ever been a sales tax levied in addition to an income tax by the same taxing authority?

Also, you mention rich people evading income tax, but with this system, businesses (ie: rich people) will still evade the sales tax by misrepresenting their sales and keeping tax money, which actually comes straight from the citizens pockets, rather then just not paying their own money to the government.

Yeah, except that that's much, much, much easier to track.


The real reason to prefer a sales tax is not that more money will be confiscated by the government, but that it doesn't punish saving like an income tax does.

Think about it: You earn $10,000. The tax rate is, say, 10%. With an income tax, you're paying $1,000, leaving you with $9,000 to save or spend. Under the income tax, you have $10,000 to save or spend, but the government only gets to tax the money you spend.

What does that sound like?

That's right, a 401(k), the staple of successful financial portfolios everywhere!

And what you're missing about your complaint regarding rich people is that they tend to consume a higher quantity of goods, and those goods tend to be of high price/quality. Which means that they'll still pay the most in sales tax.

Seriously, has anyone done the math on this? Or, you know, asked an economist?

[Domino]

Where has there ever been a sales tax levied in addition to an income tax by the same taxing authority?

The State of Arkansas levies both sales and income tax, although the income tax is very small, compared to the federal income tax. Arkansas may well be unique in this regard; I dunno.

[simple simon]

Quote by: Domino The State of Arkansas levies both sales and income tax, although the income tax is very small, compared to the federal income tax. Arkansas may well be unique in this regard; I dunno.

Maine also has both ...... not sure if New Hampshire has either .. i know NH does not have sales tax

[simple simon]

Quote by: Milton Bradley Why would we want this government to have more money?

because there are more people in need then are currently being helped

[Milton Bradley]

Quote by: simple simon because there are more people in need then are currently being helped

And giving money to the government solves this?


Man, your reasoning stinks.

[simple simon]

Quote by: Milton Bradley And giving money to the government solves this? Man, your reasoning stinks.

the government has a large history of helping it's citizens ........ not sure how you fail to see that

and i never said we should give them more money ..... i merely suggest another way of doing it i consider more effective

[Stizzles]

the government has a large history of helping it's citizens ........ not sure how you fail to see that

It has a large history of helping its citizens inefficiently, ineffectively, and on an untimely basis.

You look at the government and see welfare checks; I look at the government and see FEMA and Hurricane Katrina.

and i never said we should give them more money ..... i merely suggest another way of doing it i consider more effective

Wealth transfer doesn't generate wealth. All it does is transfer capital from those able to grow it to those unequipped, unwilling, or unable to do so.

[grandpa]

Quote by: Stizzles It has a large history of helping its citizens inefficiently, ineffectively, and on an untimely basis. You look at the government and see welfare checks; I look at the government and see FEMA and Hurricane Katrina.

I agree. It took 5 days for FEMA to get water to the superdome. That's incompetence, to say the least.

Grandpa h.

[simple simon]

FEMA is incompetent ... ok .... what does that possibly have to do with a Federal sales tax ?

[Stizzles]

Quote by: simple simon FEMA is incompetent ... ok .... what does that possibly have to do with a Federal sales tax ?

Well, you see, in a post just inches above yours, someone claimed "the government has a large history of helping it's citizens ........ not sure how you fail to see that". So I responded by pointing out that the government's "help" is most often a day late and a dollar short.

[Charlatan]

Quote by: simple simon seems a federal sales tax would do away with so many problems and provide so much more money then the system we have now .... also seems it may be a little more fair then income taxes i think we are missing out on a lot of money we could be getting from a federal sales tax when foreigners come to America and spend money here it would also solve one of the problems of illegal aliens and people who work for pay 'under the table' ..... even babysitters and kids that mow lawns .... in this case we wouldnt have to worry that their income isnt taxed because we will collect the tax when they spend that money *edit ..... forgot to add a key item this federal sales tax would also help us avoid .... seems fairly often you find out a rich person is being busted for income tax evasion .... that would obviously not be an issue with this plan

I am sure the government has figured that out and has taken the most profitable route. It is not often the government will do things that are bad for the state, but maybe the people could suffer a litttle bit without them worrying too much. If people that work under the table get away with murder then the state would take measures, bur most of that money gets spent back in that country for living expenses, and then they are kicked out a lot of the time. That makes for a better economy as people that live there will be making the money and spending it back there, so the issue isn't about taxing everyone, it's keeping the money in the country. The government must see a readout of funds being 'shipped' home, and tax that, as that would take care of 'missing' funds where the money leaves the country and becomes spent in another state. That is the only problem, seeing money 'go missing'. If money does do this it will enrich another country and that doesn't go down well with the government, so they should tax everyone before it travels.

Foreign spending in America isn't taxed because it would deter all spending, with foreigners doing all their spending and bringing stuff over from their country instead of spending money there in America. It actually wouldn't do that much to the economy to tax foreign spending there, as this isn't super tax is it, so might not be that much of a deterant. It is only the wealthy that travel, and backpackers too. Maybe a bit of money could be made by that, and that tax remains in the US so it would increase the funds there. Taxing foreigners is a good idea.

Is it better than income tax? Well you got the two extremes coming together here, tax before you spend money, and tax after you spend money. Yes taking away from the spending is good, and you don't get to tax people earning money that are illelegal, so to do the federal route would be better. Your extremes here are illegals and tourists, so to take from what is spent is the better option, definately, as illegals don't get taxed. Easy to pick this one out.

[shawmutt]

Ask a Canadian what they think about a God-damned stupid tax (my Canadian uncle's endearing name for the GST, or national sales tax on top of provincial sales tax)

[Stizzles]

I am sure the government has figured that out and has taken the most profitable route.

You are giving them far too much credit.

First, you credit them with intelligence, which is generally an unfounded assumption when it comes to politicians.

Second, you credit them with valuing tax returns and thus wanting to maximize them, which isn't necessarily true. They value their own power and their own wealth, and that's what they're going to maximize.