One of my favorite skits ever, a Tax on Thingy!

http://montypython.50webs.com/scripts/Series_2/9.htm

Third Official: Well, er, smoking's been taxed, drinking's been taxed but not ... thingy.

Your point about government's insatiable desire for tax revenue and creeping nanny state-ism is well taken.

But on the other hand, I'd rather abolish income tax and grudgingly accept consumption taxes. A flat sales tax on all goods would be preferable, but allowing for higher taxes on some goods would likely be the inevitable compromise.

Of course, a variable sales tax shouldn't be based on the notion of vice, but on the inelasticity of demand. This is actually the opposite of a behavior-modification tax, which would only succeed if demand for the good was very sensitive to the price level. Ironically, a tax that successfully changed behavior would raise very little revenue.

I love the Center for Not Science in the Not Public Interest because their advocacy makes it easy to know which side of an idea is the fascist one!

I'd prefer a straiht income tax and drop the sales tax

What Karen said... when in doubt about an issue, look to see what side the Center for Scamming the Public Ignorance is taking, and take the other side.

Hey, I've got a great idea! Let's make people pay a tax in order to vote! (Seriously, don't let your state legislators see this idea... likely they won't get the joke.)

Ironically, a tax that successfully changed behavior would raise very little revenue.

Like the tax on luxury boats during the Clinton Administration?

It ended up not only not raising the revenue it was projected to raise. It ended up almost putting American boatmakers out of business as boat buyers shifted to foreign boatmakers and foreign flagging their new boats to avoid the tax.

I'd prefer a straiht income tax and drop the sales tax

A reasonable consumption tax plan would be more equitable. The truly rich don't have incomes. Taxing consumption means everyone pays - 'cause everyone eats, everyone wears clothes, everyone shops.

A reasonable consumption tax plan would be more equitable. The truly rich don't have incomes. Taxing consumption means everyone pays - 'cause everyone eats, everyone wears clothes, everyone shops.

Consumption taxes tend to be very regressive, though, since the poor tend to spend pretty much every thing they earn, thus taxing them at the maximal rate. Seems pretty harsh to whack the poor in that way.

Regressive? Au contraire, Whatever.

I find it perversely fascinating that a tax that imposes higher burdens in the form of higher rates as one becomes more productive is called "progressive" and one that imposes equal burdens at all levels of consumption is called "regressive."

I find it regressive to view taxes as a percentage of income - as if those with a higher income somehow are deserving of society's opprobrium.

Again, the truly rich (and the truly poor) don't have incomes. Those in the lower income brackets are usually exempted. So, an income tax ends up placing the majority of the tax burden on a small percentage of society (5% of society pays the majority of taxes).

A consumption tax, on the other hand, means everyone contributes.

To avoid whacking the poor (nice), some classes of items would have to be exempt (e.g., non-alcoholic food).

And the tax rate would have to be low enough that the tax does not adversely affect consumption - after all we want folks to keep the producers employed.

Interesting redefinition of regressive and progressive; they're commonly understood terms with respect to taxation, regardless of how you feel about them.

I find it regressive to view taxes as a percentage of income - as if those with a higher income somehow are deserving of society's opprobrium.

Are taxes = society's opprobrium? Maybe. But let's take my brother - earns less than half of I do, with a wife in school and a couple of kids - they aren't "poor" in any meaningful sense of the word, but they live close to the edge, spending pretty much everything he earns. My wife and I are urban yuppie DINKs. We spend more than they do (because we can), but we save more, too. We pay a lot more in income taxes, of course, but we still are in a much better financial situation. It seems fucked if we had a tax system that ends up with him having a higher effective tax rate than me, since under some definitions of productivity (e.g., producing another generation of taxpayers, something many here are very concerned about), he's doing more than I am.

I'm not opposed to a consumption tax, per se. There's some inherent fairness in it. But I am opposed to taxes that hit more heavily those who are less able to bear the burden; it would take a carefully engineered consumption tax to accomplish that.

We'll probably never completely agree on this.

A system that has 5% of wage earners paying over 60% of the tax revenue and 50% of wage earners paying almost all of the tax revenue (96%) is inherently unfair. It means the productive are supporting the unproductive.

I agree that any tax system should not unduly burden those least able to carry the load. But it should also not unduly burden those upon whom the economy depends for survival - the middle class(who provide investment, spending, entrepreneurship, etc.).

A consumption tax relieves businesses of the expense of paying a matching share of income taxes for each employee. That means that the marginal cost of adding an employee is lowered. It also means employees keep more of their wages.

With taxes imposed at consumption rather than at income, people have an incentive (albeit a small one) to spend less and save/invest more (especially since interest or returns earned under an income tax system are considered unearned income and are taxed at an even higher rate).

Considerations for things such as having children (producing future taxpayers) would need to be worked out.

I think with careful thought a fair and equitable consumption tax can be created that will not unduly burden the poor yet will ensure that all Americans have a stake in the system since they are paying for it.

We already have several consumption taxes (er, fees): gasoline, phone service, alcohol, hotels, tobacco. Soda is a sitting target and I really am growing tired of nanny/do-gooders

We'll probably never completely agree on this...I think with careful thought a fair and equitable consumption tax can be created that will not unduly burden the poor yet will ensure that all Americans have a stake in the system since they are paying for it.

It's unlikely that we'll agree completely on this, but are probably less far apart on this than on many other things.

I agree that everyone needs to pay something into society; the buy-in is critical. I also agree that it's possible to end up with an equitable tax situation via a consumption tax. The "Fair Tax" concept that was part of Huckabee's campaign was an interesting attempt to do that.

Where we differ is on the fairness of the present system; I don't know what's fair or unfair, too low or too high, when it comes to tax rates. I earn a decent living, and my tax rates are still lower than most (all?) of the developed world. I don't feel any disincentive to try to earn more than I do now; I bust my ass every day to do that. Now, I might come crying if the company I work for gets acquired and I see a huge chunk come out a big lump sum payment, but that's a bridge I'll cross when I get there.

If you have a consumption tax with a lower or no tax on the sale of used goods, which poor people tend to buy to begin with, then that would help mitigate the regressiveness.