From: covin@tartarus.uchicago.edu (David Covin)
Newsgroups: alt.religion.scientology
Subject: Re: Some views on Scientology
Message-ID: <COVIN.91Aug2161638@despair.cs.uchicago.edu>
Date: 2 Aug 91 22:16:38 GMT
References: <1991Jul24.140607.32251@kuhub.cc.ukans.edu>
Sender: news@midway.uchicago.edu (NewsMistress)
Organization: University of Chicago Computer Science
Lines: 71
In-Reply-To: lachman@parc.xerox.com's message of 2 Aug 91 07: 17:25 GMT

In article <1991Aug2.071725.11789@parc.xerox.com> lachman@parc.xerox.com (Hans Lachman) writes:

In article <1991Jul30.201557.32438@kuhub.cc.ukans.edu> mauler@kuhub.cc.ukans.edu writes: >In article <1991Jul28.041938.12594@parc.xerox.com>, lachman@parc.xerox.com (Hans Lachman) writes: >> In article <1991Jul24.140607.32251@kuhub.cc.ukans.edu> mauler@kuhub.cc.ukans.edu writes: >>> >>>Oh, yes, we can see the benefits of sales tax over income tax. Example: >>>a poor person and a rich person both buy $1000 of items... >>>Leo >> >> Surely you don't think a typical rich person and a typical poor person >> both buy the same amount of taxable goods each year, do you? ...

>I see. Getting rich people to accept a luxury tax after repealing income tax. >Sorry, but I don't think they'd go for it. They'd just use their already >ludicrous resources to destroy the income tax, then use the sales tax to make >even more money from the poor. I still don't buy it! >Leo

OK, so we have established the following:

1. You don't want to admit that your scenario of rich people and poor people spending equal amounts per year is unrealistic.

[ etc. ]

Hans Lachman lachman@arisia.xerox.com

I'll try my hand at inserting at least a *different* voice into the debate:

My understanding of why sales taxes are considered "regressive" was that it's because rich people *don't* buy a lot more taxable items than poor people; certainly not a quantity proportional to the difference in wealth. Not everything is subject to sales taxes, and a wealthy person might well travel enough to buy a lot of stuff in states that have lower or non-existant or more limited taxes... Not to mention buying houses, stock certificates, etc. which are taxed entirely differently. Whereas *everything* a poor person buys is likely to be in the categories that are regularly subject to sales tax-- food, clothing, etc.-- consumer goods.

And even if sales taxes were levied on *all* financial transactions, so that a wealthy person paid the same percentage of the money he/she spent as did a poor person, the tax would still be regressive. You can only spend so much money on the basic necessities of life-- food, shelter, clothing, etc. But you have to spend for those *first*-- if you have very little money, that's probably all you spend your money on. So if a tax is levied on those commodities, it cuts into your ability to buy things that you absolutely *need*. It threatens your ability to live. Whereas if you have a lot of money, you will have money left over after paying for the basic necessities; which you might spend on "luxuries", things you don't really need to live. Things you could afford to do without. So a tax levied on the basic necessities doesn't really *hurt* you, it just means you might have to do without some luxuries. It doesn't threaten your life.

The upshot is that the less money you have, the smaller a *percentage* of that money you can afford to have taken away before you have to worry about going hungry, getting thrown out on the street, etc. If you tax the rich at the same rate as the poor, a tax that the rich will hardly notice will cause poor people to default on their taxes or else starve. And sales tax taxes the poor at a proportionately *higher* rate than the rich.

That is what is wrong with sales tax.

-- David Covin covin@despair.uchicago.edu

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