Sales Tax is Regressive

Discussion in 'Political Opinions & Beliefs' started by GrayMan, Mar 4, 2021.

  1. GrayMan

    GrayMan Well-Known Member

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    https://www.taxpolicycenter.org/briefing-book/who-bears-burden-national-retail-sales-tax#:~:text=Because lower-income households spend,sharply as household income rises

    "A sales tax is regressive" - Fact Check False!

    A properly implemented sales tax is pro-gressive. It offers better privacy for individuals as many will not have to file tax returns and send their private information to the IRS.

    It is simpler to do your taxes and harder for individuals to fraud because instead of itemizing, you simply don't pay sales tax on those items. Instead of deductions on an income tax, you simply exempt medicine and education purchases from sales tax.

    With proper exemptions a poor or low income person can avoid all tax.
    Essentials will be exempt such as grocery food, water, utilities, rent, used goods.

    However, they may choose to spend some money on entertainment and going out once a month or buy a newly released video game and so may end up paying a very small amount of tax. Still not much and they can avoid it.

    The article in the link I provided assumes that the sales tax is regressive based on the idea that poor people spend more of their earnings than rich people. Either people spend the money or they die with it and it goes to someone else. It's simple, we keep an inheritance tax at double or triple the sales tax but everything else will be a tax on sales.

    Also, cryptocurrency is becoming hard to track and regulate for income tax. A sales tax will eventually tax cryptocurrency once it or its gains are spent without having to track the flow between every wallet and every trade. The sales tax, is a future friendly tax.

    Finally, the IRS would have a much easier time of auditing taxes an ensuring that fraud isn't taking place because they would mostly just have to audit businesses instead of every single person. It's also a simpler tax.
     
    Last edited: Mar 4, 2021
  2. Steady Pie

    Steady Pie Well-Known Member Past Donor

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    Tax policy isn't about fairness, it's about the rich and the poor robbing those in the middle. The rest is just bureaucracy institutionalising it into a gold mine for lawyers.
     

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