Why A 10% Consumption Tax Is A Must

Discussion in 'Economics' started by libertad, Feb 26, 2009.

  1. I find it amazing that if you file over 388K in income you're in the top 1% of earners. Wow, it doesn't take much.

    And we all know liberals would NEVER go for a consumption tax, unless it only applied to the "wealthy"
     
  2. Consumption tax destroys middle class. Plain and simple. The rich are not concerned with necessities (afterall if you can't afford toilet paper you are not rich) and if you start jacking up cost of necessities you are screwed.
     
  3. At the end of the day....the tax take from the progressive structure is going to be very small....much smaller than the 10% consumption model....

    Government has to contract in size in a big way....to be more in line with revenues....

    The end game is that the govt. is on the path to being far far too large versus what the economy is going to be able to produce....

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    A broad based tax that cannot be dodged....combined with a drastic reduction in size of govt. is the only way to go.....
     
  4. kxvid

    kxvid

    Consumption tax is a horrible idea. How would you like to have you savings which you paid taxes on the be instantly devalued 10%? :confused:
     
  5. They only get the 10% if and when you spend it, in the meantime, the money is yours to keep on earning more. If they don't get it in a consumption tax, they'll get it by taxing your capital gains or dividends.

    The initial cause of this depression was over consumption. If you have to increase taxes, you think you'd want to discourage consumption by taxing it.
     
  6. But let's not stop at a 42% top rate; as a thought experiment, let's go all the way. A tax policy that confiscated 100% of the taxable income of everyone in America earning over $500,000 in 2006 would only have given Congress an extra $1.3 trillion in revenue. That's less than half the 2006 federal budget of $2.7 trillion and looks tiny compared to the more than $4 trillion Congress will spend in fiscal 2010. Even taking every taxable "dime" of everyone earning more than $75,000 in 2006 would have barely yielded enough to cover that $4 trillion.

    Fast forward to this year (and 2010) when the Wall Street meltdown and recession are going to mean far few taxpayers earning more than $500,000. Profits are plunging, businesses are cutting or eliminating dividends, hedge funds are rolling up, and, most of all, capital nationwide is on strike. Raising taxes now will thus yield far less revenue than it would have in 2006.

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    As the article states....The tax could be 100% of those making $500k and above....

    And even this would not be enough for the proposed program....
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    Obviously going in the wrong direction....

    In a very big way....
     
  7. Beats all hell outta having it confiscated.Which is where we're headed.
     
  8. Yet, despite the 14-20% VAT in Europe, the middle class is not destroyed.
     
  9. Too bad this isn't a college debate... Hell, even a high school one.

    If the arguments about taxes, spending, size and roll of government in the economy, and the TRUE pros and cons of Capitalism vs. Socialism... were presented with understanding and logic.... rather than partisan catch-phrases, lies and half-truths... soon everybody would "get it".

    Ahhh, I should live so long... :(
     
    #10     Feb 26, 2009