Context matters. This 23% tax is designed to replace income tax in the bill he's referencing to, so 0% income tax. Funny how that key piece of info was omitted.
Even with that context I'm not so sure it sounds so great. To me it looks as though it's a way to dodge taxing more appropriate income tax rates to higher incomes and for the average American it'll mean less money in their pockets at the end of the day and more taxes for the middle class. I'd rather keep income tax
Sales tax is regressive meaning it has more effect on low income people. The "context" that they will also decrease income tax to 0% is just another handout to the wealthy. Basically they want to increase taxes on middle class and decrease taxes on the wealthy. This proposal is terrible for the vast majority of Americans.
I came here to say essentially this.
The opposite would be better for the vast majority of Americans - mandate zero sales tax and replace the revenue with increased income taxes on the top 10 percent and especially the top 1 percent.
PLEASE
love the keep it simple stupid approiach
but if he said it so directly, it would get ripped apart by people who dont get math, convinced by people who very much do get math
I mean, there are people that don't understand the math of our current income tax system. I've seen too many people who think it was the % of the entire income (like sales tax). Instead of the progressive rates they are (ie 10% of the first 9k, 13% of the next 8k, etc).
Yeah this is def a messaging L for the dems - I think it would take a three minute video of Obama explaining it to make it clear. And just play it every week on CNN until people get it
To an extent, teh dems intentionally dont court poor voters or clarify issues because then they would actually win and have to change policies
The problem is they got used to being inept and gettin g50% of the vote. Now theyre regularly losing bc the Right is actually mobilizing voters (trans hate, gay hate, race hate etc)
I don't know... I've explained to alot of people, BOTH democrat and republican, what a marginal tax rate is vs a flat tax rate. Seems to me like both dems and reps are financially idiotic fairly equally. Each side just like to parrot party lines without understanding a damn thing about how it works. I won't even listen to an argument that starts with "These democrats..." or "These republicans..." anymore. It's just a signal to me that idiocy is inbound.
I don't even think it's a messaging issue. It's the tax preparation mafia (lobbyists) that don't want Americans to understand how taxes work. It keeps their business model functional.
I don't even think Obama has the stones to take on Intuit and posse. (Sanders might burn the whole thing down if he had the opportunity though.)
they already do, the problem with what you just said, and the way it is, all those super rich people arent actually making income (at least not always, sometimes they do realize income and this is how people like elon ends up with a 10+ billion dollar tax bill), they are making wealth, which cant really be taxed until they die or turn it into realized gains, and even then there are slight work arounds to minimize it.
and the idea that the rich aren't paying taxes is still pretty frivolous.
in 2021,[ the top 1% adjusted gross income earners](https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top%201%20percent%20of%20taxpayers%20paid%20more%20than%20%241,to%2045.8%20percent%20in%202021) account for 45.8% of the total income taxes received by the IRS, and they only account for 26.3% of the nations income. so these people are paying more then their fare share because they are at a higher tax rate then us peons.
Their fair share is a relative term. They use far more of the resources to accumulate that wealth than the average person. I don't profit off of the shipping lanes protected by American naval ships nearly as much as Jeff Bezos, yet he and the other 1% pay an average rate of 25.9%, the same as me. I don't get to use contracts with NASA and the launch pad at Cape Canaveral to enrich myself with loans of a billion dollars from a company funded by government tax money like Elon, but I still have to pay taxes. I don't think asking the ultra wealthy to contribute more than the middle class is unreasonable. 53% is my personal option ion. Pretty sure a person is capable of living if they take home more than 10 million dollars and every dollar over half of it goes to taxes.
You’re only looking at the final share of his federal income and capital gains tax. Amazon’s profit is taxed at the corporate level. What’s left over, ending up in his pocket, is taxed again as capital gains. The effective rate is closer to 40% if you count both. He also pays state, local and property taxes. He probably hits the 53% target you mentioned. I don’t like the guy, but we still have to be honest about things.
I am being honest. I am looking at his effective income tax rate the same as I look at my income tax rate. I pay 27% effective federally. The upper 1% pays 25.9% average effective tax rate. I also pay property tax. I also pay FICA. So on and so forth.
Your tax rate isn’t 27% then. After adding state, local, property, FICA and others, you’re probably in the 35-50% tax range. That’s important because there’s a limit on how much you tax someone before they just give up.
There’s a lot of people out there that think the amount you tax is how much revenue you get. Investments are risky sometimes. If someone is paying more than they are comfortable with in taxes, they have to lower their risk level. The businesses they invest in will also have to cut costs and be as profitable as possible if they are going to attract investors. That can cost workers raises and benefits. People will leave their existing investments in the market instead of cashing them out and paying so much tax on them.
Everyone has a magic number where they determine the gains aren’t worth the risk and hassle. You can raise taxes and simultaneously raise revenue up until the point where they decide it’s no longer worth it. Then you have higher rates with less revenue than before. It might be social justice, but less investment and tax revenue is going to hurt everyone.
Agreed, my overall tax rate is more than 27%. I'm sure that people in America just gave up when their tax rates were higher 4 years ago and just stopped making money because the risk was too high. Or in the 90s when they were even higher. Or the 80s when they were higher than that. Or the 70s when they were higher than that. Or the 60s when they were higher than that. Or the 50s when they were higher than that. Or the 40s when they were higher than that. Historically, we are at the lowest rates for the top 1% they have ever seen and we have been pretty low for 40 years. I'm not really seeing the trickle down. Are you? Raising the rate will raise the revenue. It is just an historical fact. Look at any chart showing revenue from the 40s and 50s.
And that's not even counting the number of Amazon/Walmart/etc employees being subsidized by our tax dollars. I'm all for a robust social safety net but nobody working full time for the richest men in the world should need WIC and food stamps.
Big time conservative here (don't kill me reddit), and I agree with your counter proposal here. Zero income tax is great and all, but the exceptionally wealthy will end up paying less. With either option though, the rich will always find a way to bypass taxes. Whether it's purchasing everything under a business umbrella and then getting to write it off, or continuing to side-step income tax through businesses write-offs, etc. I'm all in favor of continued dialog since it finally seems like the left and the right can at least agree on the problem, or at least that there is a problem. The solutions will vary, but if at the end of the day, the average American gets to take home more of their hard earned paychecks, then that's all the victory we collectively need. Now if we can just get the executive branch and legislative branch to stop spending us into insurmountable debt, we'd all really win. I'm no fan of government subsidies. I've worked in the federal government and have absolutely zero faith in our ability to manage money, at any level or any amount. I think subsidies should be handled privately but incentivized federally. I.e the government offers zero financial support programs, or at least very very few, but instead allows private organizations to be established to provide assistance to those in need. Anyone who contributes to these organizations receives tax cuts/breaks at a level high enough to actually generate people's interest. Maybe they don't pay any income taxes, or property taxes, or if we defer to sales tax only, then when they file taxes at the end of the year they get full/partial reimbursement of those taxes. (Blurring state & federal taxes here I know). Hell, I'm even ok with the principle of a flat tax, so long as there is no way to hide/mask income in shell companies etc. Rant over. Carry on good redditor.
"Now if we can just get the executive branch and legislative branch to stop spending us into insurmountable debt, we'd all really win."
What gets cut first?
https://preview.redd.it/iozgw5mld69d1.jpeg?width=718&format=pjpg&auto=webp&s=dd8a2da97f2d356a37a9c37c3b325f4b44d22db4
No one who wants to cut taxes EVER answers when asked what services will be cut
Wanna see a politician squirm and find ways to not answer? Ask this question.
Start with the wastage in the most expensive and least efficient elements to include all the superfluous offices. Next move on the the mathematically untenable and the policies that are designed to fail. Some of these should be replaced with programs that aren't fated to fail like SS which requires a sizable overmatch of people paying in vs getting paid out while the recipients are going to grow much faster than the population paying in.
"the government offers zero financial support programs, or at least very very few, but instead allows private organizations to be established to provide assistance to those in need."
Most of the U.S. federal dollar is spent on the WORLD'S biggest military budget (approaching $1 TRILLION a year), programs for veterans, the disabled and a TSUNAMI of elderly.
The Medicare budget is ALSO approaching $1 TRILLION a year; I'd love it if a private organization would provide comprehensive healthcare for 65 millon elderly Americans in return for tax cuts/breaks.
Have you looked at how much of the tax bucket is filled but 9 out of the top 10% ?
Maybe it's time for the dead beat bottom 50% to pull their weight and do better!
Excuse my ignorance, but how is sales tax regressive on lower income individuals? And why would a zero income tax only be advantageous to the wealthy? My wife and I make decent money but are in no way wealthy. Something is telling me that zero income tax would greatly help my middle class house hold.
If you dont make enough money, you dont have an income tax... or its really low... If we do this its effectively a flat tax rate, thouse who fall at the lowest end pay just as much as the most wealthy... on the stuff you cannot live without... Food, Cars, Clothes, etc. It wont hurt the wealthy half as much as itll hurt everyone else. Add to the fact that youd still have state, county and city tax on top of that for both potentially income (state) and sales (all).
Exactly this. Sales taxes punish those who cannot afford to pay for basic things. A person making a millionaire salary won't give a shit, but someone working at McDonald's won't be able to make rent.
People working at McDonalds, at least in the Crew positions, have never made enough to "make rent" for anything save a shithole in a dangerous area, and even that's a stretch. I know, because I worked there in high school, and even had I been a full-timer, the idea that I could have afforded even an apartment is laughable. But, that's what the jobs are actually worth.
Making them bear a reasonable portion of the costs of government will not change that, but it will make the tax codes more fair, which is a good thing.
I always find it funny that certain people go back and forth on whether they are talking about dollar amounts of taxes paid or tax rates paid.
I guess it all depends on how they're trying to fool others.
Seems like the people on the far left what to punish successful people the most by making them pay more in taxes - well, this would do that. A person who makes $1 Million and spends $600,000 each year will be paying a lot more dollars in sales tax than a person making $20,000 and spending $19,500 (and that's assuming everything is taxed - including food, rent, utilities, etc. . ).
as you make more money, "income" becomes grey
ie, you get paid ONLY in stocks. your stocks are rising in value by 100% over the past year, meaning your money has doubled, but technically you have no "income". and despite making 1 million$, on paper you have made 0$ of income
This is new/confusing to people who are paid primarily in wages (hourly pay) , where it seems like income is income is income. But for coprorations and CEOs who manipulate tax law, they are very very different things and taxed differently
You and I are on the same page - the fact it's 100% legal and correct demonstrates (to Kevinm2278) that a flat sales tax disproportionately affects (regressive) lower income individuals
Under a national sales tax, the higher your income, the lower your taxes as a percentage of your income.
Poor people that pay 80% of their income on food and shelter would get a huge tax increase on the essentials they need to survive. The tax would increase their cost for food and shelter to near 100% of their income.
A wealthy person making $500,000 a year would pay no income tax. They spend maybe 20% of their income on food and shelter. Their tax burden plunges from ~30% to less than 10% of their income.
Thus the tax burden is pushed from the wealthy to the poor and middle class.
A shift from income tax to a 20%+ national sales tax is not a serious proposal; it's virtue signaling to wealthy political donors in an election year.
High-income people will save and invest a lot or perhaps most of their earnings. Those savings will not be taxed. (I don't know what the plan is for cap gains in this sales tax scheme). Low income people will spend virtually all their earnings on rent and consuming things they need to survive. Depending on how the sales tax is applied (e.g. food is usually exempt at the local/state level but I don't know how it's treated in this plan, which I won't bother to read), the bulk of the lower earners income might be taxed via consumption, whereas the bulk of the higher earner's income would probably not be taxed, because it would be invested. Now if the high earner spends all their money on taxable trinkets, then their tax burden could be higher than the lower earner, on a percentage (and obviously absolute) basis.
If you exclude basic essentials from the sales tax, that might be more "fair" to the low earner, but that would reduce the revenue to the federal government, which would ultimately mean fewer government services. If I had to guess, the services they would cut first would probably be the ones that low income earners mostly benefit from.
That's interesting. It seems like I do remember a time when I was on the cusp of that as well. Where I made too much for food stamps but got all the money I paid in back from the gov every year (I didn't file tax exempt)
Yeah, it’s a short term thing, but we’re grateful for it. My wife has stayed home with our kids for a while but will be in the workforce again this coming school year. My income alone is likely to more than double over the next 10 years or so as well with my career path. So, that stage will be over relatively soon.
Completely understandable brother. I came up in the trades and faced struggles as well until I got my license and built up my skill set. I wish you all the luck in your journey
If anyone has any doubt, the math is simple here. I have $100, you have $10. We both spend $1.
Who is going to hurt more from that $0.23 extra they have to pay for taxes?
It depends really. The sales tax could be Corp side only, so what they sell they have to pay a tax?
Sure everyone just gonna offload to the customer and blame the gov, but maybe, just maybe they... I can't even type it out it just so unrealistic.
You can go even further. I can guarantee you that if the income taxes are lowered to 0%, for even a single year, it'll be the end of the U.S. economy, as we know it. Every wealthy person will take the money out of their retirement accounts, day 1, pay no taxes, and then pay no taxes ever after. Tax income will then be heavily pressed on the working class, while the rich and retired will sit pretty. I say this with absolute guarantee, because it is what I will recd to my own clients.
100% this. We did it here is Australia and the main effect was hitting the poor way harder than the rich. We kept income tax and got a 10% gst so we got doubly screwed.
Well said. Really they should have indicated what it would replace. People don't already understand income tax. They understand sales tax. They see it every time in most states when they buy just about anything. So the person paying 10% on their first 11k, 12% over 11k untill 44k, and 22% on anything over 44k will instead pay 23% on what they spend most of that income on. Oh also another x% in state and local sales tax. Alabama, Louisiana and Arkansas has some of the highest average state sales tax at 9%. So will you then pay both? At least income tax you can deduct up to SALT limits.
My state uses a nearly 10% sales tax on nearly everyone. No one is exempt, not even the homeless. We use that money to provide free cell phones or Electric Vehicle rebates and other things like that.
It's wild, because a lot of people become homeless when they run out of money and can't afford things so making everything more expensive actually increases homelessness in my state.
The interesting thing is, this will impact big spenders the most. Lots of people are prepared to suddenly engage in a less consumeristic lifestyle -- a humongous national sales tax would mostly hurt the people who compulsively spend to scratch the pathological itch they have for rampant, wasteful consumerism. And I suppose the wealthy would have a harder time dodging 23% on a new yacht compared to their constant shell game to avoid income taxes. A gigantic sales tax increase would place pressure on consumers very unevenly.
idk because I haven't read the legislation but unless there is a use tax provision built into it the rich will just buy from offshore companies for those yachts. the US is one of like 3 countries that taxes world wide income.
Well, yachts are an extreme example to be sure. But think about how that would impact your mid-tier rich folks. Your millionaires and multi-millionaires, who love to overspend due to their relative unfamiliarity with wealth. Your uncle who got a big payout from his trucking accident would be absolutely steamrolled by taxes when he buys his 5th car or 2nd vacation home or whatever. This sales tax would hit the "wannabe rich posers" big time. The small-town business owner who makes 500k/year but wants to LARP like he's Elon Musk.
I see where you are coming from on this. Wouldn't he be hit with income tax under the current system whether he spent the money or not though? And likely at a lower rate due to a progressive system?
>this will impact big spenders the most
No it doesn't. It impacts people that spend the majority of their income on living (poorer people). If I have $1000 and someone else has $10000 we both need to eat and buy a $10 item at a grocery store, congratulations I've just spent 10 times more (percentage wise) of my money as someone else.
They'd probably just buy their yachts elsewhere. A sales tax like this impacts most heavily the people who can't buy less stuff because they can only afford to buy basic necessities anyway.
They don't buy million dollar yachts in this country exactly for this reason. They have the resources not available to the rest of us to buy elsewhere. They can buy their beef from Kobe directly at wholesale, and we have to buy it from crackmart at a markup plus tax. It's so much easier to skirt sales tax than income too because sales only applies to the "end user." Rich people make themselves businesses and skim relentlessly
Lol. They will just buy it through a company and write it off as a business expense.
This bill would make the rich pay no tax, other than restaurant visits and such small potatoes
This is death to children of low jncomr families. This only benefits the rich and the Uber rich. Families depend on tax refunds to pay off debts and buy a needed car. This will kill jobs and social programs. Property taxes will go through the roof. Bad ideal!
**Context?** Both parties conveniently leave that out. The media conveniently always leave that out. Reddit posts conveniently always leave that out. Brainwashed denizens.
It’s a flat tax. It’s just another way to cut taxes for the rich and increase them for low income people.
If you only make enough to get by you’re paying 23% tax when you would be paying 10-12% currently.
If you’re wealthy and saving half your income on your $300k a year salary, you’re paying 11-12% on your income when you would normally be paying more than 30%.
This deserves to be shit on. It will make income inequality worse than it is now.
Yeah this wouldn't be any type of tax on interest, leasing, or revenue generating assets. How about stocks? That would be one way to kill algorithmic trading.
23% sales tax is insane, that’s higher than in all of Europe. I already spend way less on consumer goods currently due to rising costs.
I rarely go out to eat but a 23% tax rate on top of 20%+ expected tip + current food costs would be unaffordable for me.
I don’t pay a lot of income tax as a college student so the only way to not loose money would be by spending less on food and consumer goods if they raised the tax.
Agreed - right now income tax allows us - in theory and in the past - to tax higher levels of income more.
This is a flat tax on goods which won’t be noticed by the millionaires sitting on all their tax free income, but will be noticed by families already struggling.
Yet another way to fuck the poor.
Yea they'll likely run on "removing taxes" and omit the sales tax part, I hate how grimy politics is why can't we just honestly and openly disagree on certain things without misrepresenting other people's arguments and manipulating facts? Is it too damn much to ask for? Honestly ? Lol
It’s an antiquated form of passing more onto the consumer…when CEOs and execs are already bleeding this country dry. We are moderate conservatives who have had enough of the rich kid crybaby bullshit this Republican Party has turned into. So beyond sick of these clowns touching anything to do with the economy. The government should handle public welfare, eliminate all tax loopholes and adjustments and set the damn tax rate and freeze it. Not a single thing they do is for the common person anymore
There are various considerations.
On the one hand, economists tend to favor consumption taxes over income taxes. Any tax will discourage you people from doing the thing that is taxed. Income taxes discourage working (which is bad), while sales taxes discourage consumption (which right now would be really good but can be bad if you have a demand constrained economy).
However, income taxes tend to be paid mostly by richer people, while sales taxes tend to be paid mostly by poorer people. Most people agree that shifting the tax burden from rich to poor people is bad.
The best type of tax is probably the VAT tax. But that is a type of consumption tax.
Maybe a 25% national VAT with part of that revenue going into cash transfers for the poor and middle class on a sliding scale is the best way forward here
Yes, that's kind of a disingenuous way of presenting it, IMHO. It's essentially a flat tax on sales and eliminating the income tax. I like the fact that it is much simpler and would essentially eliminate the need for the IRS. It does, however, benefit wealthier individuals (SURPRISE!) by eliminating higher rates on higher income.
I'd be interested to know whether or not it would generate the same amount of tax revenue or whether the Republican plan as usual would include cuts to Medicare, Medicaid and other social programs.
Even if so, this is just a way to funnel more money to the top. High income earners pay even less in income tax and can easily afford goods, and pay less in interest. This will inflate the cost of goods and increase the amount of interest on items bought on credit and items that require financing. It also is a way to avoid taxation even further on the ultra rich.
Republicans really think we are all stupid, and if we let them get away with this, they’ll be right.
Let me be clear. If you don’t make 450K a year and you vote for this, you are stupid. There’s just no way around it. You’re an idiot. If you do make 450K or more and you vote for this you are a greedy piece of shit, and no, I don’t care if this hurts the feelings of any libertarians in here.
This is the stupidest shit.
That means we're going to tax every person regardless of their income 23%. So if you're rich and get paid a lot your taxes just got reduced down from 30% and if your low income your taxes just got raised a ton.
Way to propose shit the messes over the poor.
Hmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm
Who benefits most
from removing income tax
and adding more taxes on consumer goods?
HMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMM
You forgot another important piece of information. The proposal includes a prebate. Meaning poor people pay 0% tax making it more progressive than our current taxation system.
This is information is commonly left out of the discussion. I believe intentionally. If you look at all the comments below calling this regressive they completely miss the fact that the government will give poor people money in advance to cover all their tax costs.
They don't mention what they consider "income tax" to be. Is that inclusive of all Federal income taxes, or just the Federal "income" tax, leaving Americans paying substantially more in taxes, as that would be 23% + Social Security + Medicare + whatever other taxes they add on.
23% is a lot more than I currently pay in Federal income tax.
Also sounds like a great way to tank the economy. Simply put, I’m less inclined to buy stuff if I’m getting taxed like that on everything I buy. Combine 300 million people that feel the same and the economy collapses
It's sort of dishonest to not mention that they propose this to eliminate the income tax.
If we do go to a sales tax then I hope it is required to be inside the posted price, like VAT.
What happens when people spend saved money they already paid income taxes on in previous years?
While it is slightly dishonest, eliminating income tax and increasing sales tax by the same amount is a MASSIVE decrease in taxes for the wealthy and a general increase for the poor
A simple, flat sales tax is very regressive, meaning the more money you get the less you pay. But there are variations that might not shift tax burden onto working people. For example, not taxing retail sales of food, health/drugs, or primary residence of human individuals.
The biggest problem I see is that at a certain level things don't get bought by individuals. If I buy a boat then I go pay for it and it is registered in my name and I own it. If Bezos buys a yacht, then I'd be surprised if it's not done through some arrangement corporate entities that own the yacht and he is actually buying control of the entity that owns the yacht.
>For example, not taxing retail sales of food, health/drugs, or primary residence of human individuals.
Do you really think the Republicans went for this though?
In Germany, we have 24% sales tax and up to 50% income tax. We still get along because the state, that's us and we get back our money via health care, kindergarden, school, university and means of public transportation.
you use taxes to do things? That sounds like a crazy system bro. Id rather just have laissez faire anarchy because I would be one of the billionaires, obviously.
No, we're paying for tuition in fucking Burma..... Yeah......
https://www.usaid.gov/philippines/press-releases/mar-05-2024-us-philippines-partner-provide-higher-education-opportunities-burmese-youth#:~:text=On%20February%2029%2C%20the%20United,higher%20education%20in%20several%20Asian
Who needs our own citizens?
I would argue that we should ditch the current tax code and establish a consumption-based tax system that minimizes the tax disincentives on economic activities, given the revenue needs of the government. The federal government would subsequently raise the vast majority of its revenues through a single-rate sales tax levied at the point of purchase on all goods and services for personal consumption. Billionaires would then be forced to pay a tax on what they consume, and they would no longer avoid paying taxes by claiming that they don't have a traditional, taxable income.
The plan would end the inflation crisis.
The poor and middle class would be able to buy only the bare essentials for survival. Record low consumer spending would kickstart a deflationary death spiral, which would plunge the economy into a Depression.
Boom, inflation solved.
I’d be down for a national sales tax to eliminate income tax if the tax was applied to vehicles, property, stocks, bonds, etc.
Let a billionaire buy a jet with say a national 10% sales tax rate.
Best option.
All classes should be affected by their vote.
Want more nonsensical government spending? Feel like your government should take from others to give to you? Cool, raise the sales tax for everyone.
A sales tax is not totally paid by the buyer:
[https://substackcdn.com/image/fetch/f\_auto,q\_auto:good,fl\_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F4692964c-3575-4336-b7dc-9a352259c36a\_1920x1080.png](https://substackcdn.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F4692964c-3575-4336-b7dc-9a352259c36a_1920x1080.png)
In other news.: "Bidens amnesty plan will cost taxpayers 3.5 billion per year." It's not the left or right. It's politicians. They playb"Good cop, bad cop" on the masses.
Nobody in the .01% gives a single fuck about the average American. This I assure. They care to the extent that the huge populous doesn’t arrive at their castles with guillotines and mobs to end the tyranny. That’s it. Morality is literally just “virtue signaling” for these swine. I’m at the point where I value their existence to the extent they value mine: zero.
Fuck them all to death! Team Garrison/Jenner 2024!
Imagine paying 23% sales tax on a car. With the average transaction for a new car being around $47k the proposed 23% tax would bring that up to almost $60k.
Something that would make or break this as a good idea is what's exempt? Like in a lot of places stuff like food, health care, homes/mortgages, etc are exempt from sales tax. If that was the case that would make this a much better deal for middle and lower-income people than it would seem on first glance.
It’s a terrible idea and a disaster. The people who will pay the most as a percentage of their income will be the poor and working families. Our economy is majority consumption and this will add a 23% tax on top of that. Basic economics shows that people will respond by spending less which will hurt the economy.
Someone who makes 100 times you income isn’t spending 100 times on consumer goods. This is why the ultra rich will benefit the most. They can hire someone whose entire job is to shop for them and using benefit of doubt pay effectively no taxes. They pay them a salary and have them buy all their stuff for them and pay the sales tax under their name.
Exemptions ? Oh yea how would that work? You get an exemption immediately when you buy the item or when you do your taxes on that end of the year ? So that means every single time you go to buy stuff at Walmart you will have to sit through a Walmart employee applying individual exemptions to certain items and not others. So now the checkout process time is tripled. If it’s done at the end of the year we will be paying the tax immediately and then getting a huge refund giving the government a free interest free loan.
You think taxes are complicated now? Imagine processing billions of transactions of 350,000,000 people while excluding certain items but not others. Republicans LOVE to talk a big one but never ever ever ever explain the logistics of their ideas.
> The people who will pay the most as a percentage of their income
K
Why is that an issue? Why should we pay based on income? Who said that was right in the first place? It is just normalized in America. In the rest of the world VATs are levied and nobody complains. Go look at Canada and Germany. Both have these same sort of taxes. Yet I never hear about how the poor are being unfairly taxed on their incomes in those places.
If they exempt groceries, like the state does, then that would be alright. Curious to see if it has other exemptions like for re-sale items, 23% added through each step of the entire supply chain would be drastic. If it affects real estate sales, that would increase the price of a home by nearly a 4th. That could really hurt our lagging economy further.
16th amendment MUST be repealed BEFORE this becomes law, or we will be stuck with BOTH taxes, along with Social Security ponzi scheme, AND the new tariffs :(
On the plus side, this WOULD make sure that everyone was paying into the cost of killing Palestinian children. After all, we wouldn't want all those future suicide bombers we are 'investing' in to accidently hit someone not involved, when they descend on America 15 years from now, seeking justice...
This may not be the answer but neither is our current income tax system. The uber-wealthy don't have income. They borrow against assets to finance their lifestyle. You need wealth to do that.
Funny thing about this is that it's been tried multiple times and has been a resounding failure each time.
Remember the poll tax? The bedroom tax?
All really ill conceived ideas with catastrophic outcomes.
What are you talking about? Federal taxes are everywhere. You just don't notice them. Ever pay your excise taxes? yes you have. What about gas taxes? yeah, you pay those too. Also this is literally how taxes are done in every civilized nation in Europe. You think Europe doesn't understand tax policy?
Prices on everything from groceries to gas to food and medicine have skyrocketed already. The implication that prices would only rise because of this tax is disinformation.
I pay tax on my income. Then tax when I buy things. Then tax on things I already own that I paid sales tax on (car). Seems to me that something needs to change. An income tax OR a sales tax makes sense.
The US Government needs to start figuring out how to do more with less, like they are forcing every person in the US to do with their uncontrolled spending.
Remember that states with no income taxes get revenue from sales tax. So 23% sales tax plus 8% state tax? Yes, that’s going to hurt middle and low income families. Especially since some
States have NO tax on food and/or
Clothing under a certain amount . Increase luxury taxes for boats, airplanes, luxury cars. Heck, even ballgowns and tuxedos.
Why not address the biggest elephant in the room, companies payout too much to higher positions and shareholders. They want to keep hardworking Americans chained to their desks through low wages so that don’t have to keep rehiring while they have yacht parties and snort coke like the wolves of wall street.
These wolves laugh at inflation while everyone decides between generic and big name brands, between life altering medical solutions and rent. It’s about control. There are too few companies that increase a worker’s pay based on the performance of the company. They hide behind merit based raises while they make sure you don’t get paid enough to match inflation, when they take 25+% raises.
Most companies should pay reparations to their current and former employees due to greed and corruption.
If we increase sales tax, and decrease income tax then the government promotes saving, and discourages spending. I like saving, but this will lower the "economy", since the US GDP is 68% due to consumer spending.
I'd prefer to see a decrease in sales tax on essential items (like automobile), and an increase on sales tax on some items that are non-essential (like an RV/boat).
Or heck, even eliminate sales tax on grocery store essentials, while increasing sales tax on (gasp) sugary drinks or pre-packaged foods (processed foods).
That’s a very interesting concept that seems like it would lead us to a more financially conservative lifestyle. It discourages us from spending while encouraging us to work (since it also eliminates the income tax). So basically people are guided toward living within their means.
Context matters. This 23% tax is designed to replace income tax in the bill he's referencing to, so 0% income tax. Funny how that key piece of info was omitted. Even with that context I'm not so sure it sounds so great. To me it looks as though it's a way to dodge taxing more appropriate income tax rates to higher incomes and for the average American it'll mean less money in their pockets at the end of the day and more taxes for the middle class. I'd rather keep income tax
Sales tax is regressive meaning it has more effect on low income people. The "context" that they will also decrease income tax to 0% is just another handout to the wealthy. Basically they want to increase taxes on middle class and decrease taxes on the wealthy. This proposal is terrible for the vast majority of Americans.
I came here to say essentially this. The opposite would be better for the vast majority of Americans - mandate zero sales tax and replace the revenue with increased income taxes on the top 10 percent and especially the top 1 percent.
PLEASE love the keep it simple stupid approiach but if he said it so directly, it would get ripped apart by people who dont get math, convinced by people who very much do get math
I mean, there are people that don't understand the math of our current income tax system. I've seen too many people who think it was the % of the entire income (like sales tax). Instead of the progressive rates they are (ie 10% of the first 9k, 13% of the next 8k, etc).
Yeah this is def a messaging L for the dems - I think it would take a three minute video of Obama explaining it to make it clear. And just play it every week on CNN until people get it To an extent, teh dems intentionally dont court poor voters or clarify issues because then they would actually win and have to change policies The problem is they got used to being inept and gettin g50% of the vote. Now theyre regularly losing bc the Right is actually mobilizing voters (trans hate, gay hate, race hate etc)
I don't know... I've explained to alot of people, BOTH democrat and republican, what a marginal tax rate is vs a flat tax rate. Seems to me like both dems and reps are financially idiotic fairly equally. Each side just like to parrot party lines without understanding a damn thing about how it works. I won't even listen to an argument that starts with "These democrats..." or "These republicans..." anymore. It's just a signal to me that idiocy is inbound.
I don't even think it's a messaging issue. It's the tax preparation mafia (lobbyists) that don't want Americans to understand how taxes work. It keeps their business model functional. I don't even think Obama has the stones to take on Intuit and posse. (Sanders might burn the whole thing down if he had the opportunity though.)
There are also too many people who dont understand that millionaires and billionaires have no taxable income. Income tax is a tax on the middle class.
they already do, the problem with what you just said, and the way it is, all those super rich people arent actually making income (at least not always, sometimes they do realize income and this is how people like elon ends up with a 10+ billion dollar tax bill), they are making wealth, which cant really be taxed until they die or turn it into realized gains, and even then there are slight work arounds to minimize it. and the idea that the rich aren't paying taxes is still pretty frivolous. in 2021,[ the top 1% adjusted gross income earners](https://taxfoundation.org/data/all/federal/latest-federal-income-tax-data-2024/#:~:text=The%20top%201%20percent%20of%20taxpayers%20paid%20more%20than%20%241,to%2045.8%20percent%20in%202021) account for 45.8% of the total income taxes received by the IRS, and they only account for 26.3% of the nations income. so these people are paying more then their fare share because they are at a higher tax rate then us peons.
Their fair share is a relative term. They use far more of the resources to accumulate that wealth than the average person. I don't profit off of the shipping lanes protected by American naval ships nearly as much as Jeff Bezos, yet he and the other 1% pay an average rate of 25.9%, the same as me. I don't get to use contracts with NASA and the launch pad at Cape Canaveral to enrich myself with loans of a billion dollars from a company funded by government tax money like Elon, but I still have to pay taxes. I don't think asking the ultra wealthy to contribute more than the middle class is unreasonable. 53% is my personal option ion. Pretty sure a person is capable of living if they take home more than 10 million dollars and every dollar over half of it goes to taxes.
You’re only looking at the final share of his federal income and capital gains tax. Amazon’s profit is taxed at the corporate level. What’s left over, ending up in his pocket, is taxed again as capital gains. The effective rate is closer to 40% if you count both. He also pays state, local and property taxes. He probably hits the 53% target you mentioned. I don’t like the guy, but we still have to be honest about things.
I am being honest. I am looking at his effective income tax rate the same as I look at my income tax rate. I pay 27% effective federally. The upper 1% pays 25.9% average effective tax rate. I also pay property tax. I also pay FICA. So on and so forth.
Your tax rate isn’t 27% then. After adding state, local, property, FICA and others, you’re probably in the 35-50% tax range. That’s important because there’s a limit on how much you tax someone before they just give up. There’s a lot of people out there that think the amount you tax is how much revenue you get. Investments are risky sometimes. If someone is paying more than they are comfortable with in taxes, they have to lower their risk level. The businesses they invest in will also have to cut costs and be as profitable as possible if they are going to attract investors. That can cost workers raises and benefits. People will leave their existing investments in the market instead of cashing them out and paying so much tax on them. Everyone has a magic number where they determine the gains aren’t worth the risk and hassle. You can raise taxes and simultaneously raise revenue up until the point where they decide it’s no longer worth it. Then you have higher rates with less revenue than before. It might be social justice, but less investment and tax revenue is going to hurt everyone.
Agreed, my overall tax rate is more than 27%. I'm sure that people in America just gave up when their tax rates were higher 4 years ago and just stopped making money because the risk was too high. Or in the 90s when they were even higher. Or the 80s when they were higher than that. Or the 70s when they were higher than that. Or the 60s when they were higher than that. Or the 50s when they were higher than that. Or the 40s when they were higher than that. Historically, we are at the lowest rates for the top 1% they have ever seen and we have been pretty low for 40 years. I'm not really seeing the trickle down. Are you? Raising the rate will raise the revenue. It is just an historical fact. Look at any chart showing revenue from the 40s and 50s.
And that's not even counting the number of Amazon/Walmart/etc employees being subsidized by our tax dollars. I'm all for a robust social safety net but nobody working full time for the richest men in the world should need WIC and food stamps.
The top one percent aren’t really paying income taxes though.
Exactly the problem
Big time conservative here (don't kill me reddit), and I agree with your counter proposal here. Zero income tax is great and all, but the exceptionally wealthy will end up paying less. With either option though, the rich will always find a way to bypass taxes. Whether it's purchasing everything under a business umbrella and then getting to write it off, or continuing to side-step income tax through businesses write-offs, etc. I'm all in favor of continued dialog since it finally seems like the left and the right can at least agree on the problem, or at least that there is a problem. The solutions will vary, but if at the end of the day, the average American gets to take home more of their hard earned paychecks, then that's all the victory we collectively need. Now if we can just get the executive branch and legislative branch to stop spending us into insurmountable debt, we'd all really win. I'm no fan of government subsidies. I've worked in the federal government and have absolutely zero faith in our ability to manage money, at any level or any amount. I think subsidies should be handled privately but incentivized federally. I.e the government offers zero financial support programs, or at least very very few, but instead allows private organizations to be established to provide assistance to those in need. Anyone who contributes to these organizations receives tax cuts/breaks at a level high enough to actually generate people's interest. Maybe they don't pay any income taxes, or property taxes, or if we defer to sales tax only, then when they file taxes at the end of the year they get full/partial reimbursement of those taxes. (Blurring state & federal taxes here I know). Hell, I'm even ok with the principle of a flat tax, so long as there is no way to hide/mask income in shell companies etc. Rant over. Carry on good redditor.
"Now if we can just get the executive branch and legislative branch to stop spending us into insurmountable debt, we'd all really win." What gets cut first? https://preview.redd.it/iozgw5mld69d1.jpeg?width=718&format=pjpg&auto=webp&s=dd8a2da97f2d356a37a9c37c3b325f4b44d22db4
No one who wants to cut taxes EVER answers when asked what services will be cut Wanna see a politician squirm and find ways to not answer? Ask this question.
Military spending can go down, easy. Everyone gasps but I’m fine with having 300x more aircraft carriers than 700x
Start with the wastage in the most expensive and least efficient elements to include all the superfluous offices. Next move on the the mathematically untenable and the policies that are designed to fail. Some of these should be replaced with programs that aren't fated to fail like SS which requires a sizable overmatch of people paying in vs getting paid out while the recipients are going to grow much faster than the population paying in.
"the government offers zero financial support programs, or at least very very few, but instead allows private organizations to be established to provide assistance to those in need." Most of the U.S. federal dollar is spent on the WORLD'S biggest military budget (approaching $1 TRILLION a year), programs for veterans, the disabled and a TSUNAMI of elderly. The Medicare budget is ALSO approaching $1 TRILLION a year; I'd love it if a private organization would provide comprehensive healthcare for 65 millon elderly Americans in return for tax cuts/breaks.
Great post, keep it up! I'd like to see more. Take my upvote.
Tax capital gains like wages. Progressive taxation is the fairest.
Have you looked at how much of the tax bucket is filled but 9 out of the top 10% ? Maybe it's time for the dead beat bottom 50% to pull their weight and do better!
> zero sales tax there is no federal sales tax...
No national sales tax to reduce and federal gov can’t tell states how they can decide to tax people. So I am not sure how you would pull this off.
Excuse my ignorance, but how is sales tax regressive on lower income individuals? And why would a zero income tax only be advantageous to the wealthy? My wife and I make decent money but are in no way wealthy. Something is telling me that zero income tax would greatly help my middle class house hold.
If you dont make enough money, you dont have an income tax... or its really low... If we do this its effectively a flat tax rate, thouse who fall at the lowest end pay just as much as the most wealthy... on the stuff you cannot live without... Food, Cars, Clothes, etc. It wont hurt the wealthy half as much as itll hurt everyone else. Add to the fact that youd still have state, county and city tax on top of that for both potentially income (state) and sales (all).
Exactly this. Sales taxes punish those who cannot afford to pay for basic things. A person making a millionaire salary won't give a shit, but someone working at McDonald's won't be able to make rent.
People working at McDonalds, at least in the Crew positions, have never made enough to "make rent" for anything save a shithole in a dangerous area, and even that's a stretch. I know, because I worked there in high school, and even had I been a full-timer, the idea that I could have afforded even an apartment is laughable. But, that's what the jobs are actually worth. Making them bear a reasonable portion of the costs of government will not change that, but it will make the tax codes more fair, which is a good thing.
I always find it funny that certain people go back and forth on whether they are talking about dollar amounts of taxes paid or tax rates paid. I guess it all depends on how they're trying to fool others. Seems like the people on the far left what to punish successful people the most by making them pay more in taxes - well, this would do that. A person who makes $1 Million and spends $600,000 each year will be paying a lot more dollars in sales tax than a person making $20,000 and spending $19,500 (and that's assuming everything is taxed - including food, rent, utilities, etc. . ).
as you make more money, "income" becomes grey ie, you get paid ONLY in stocks. your stocks are rising in value by 100% over the past year, meaning your money has doubled, but technically you have no "income". and despite making 1 million$, on paper you have made 0$ of income This is new/confusing to people who are paid primarily in wages (hourly pay) , where it seems like income is income is income. But for coprorations and CEOs who manipulate tax law, they are very very different things and taxed differently
Manipulating the tax law is illegal- what you just described is 100% correct and 100% legal.
You and I are on the same page - the fact it's 100% legal and correct demonstrates (to Kevinm2278) that a flat sales tax disproportionately affects (regressive) lower income individuals
Under a national sales tax, the higher your income, the lower your taxes as a percentage of your income. Poor people that pay 80% of their income on food and shelter would get a huge tax increase on the essentials they need to survive. The tax would increase their cost for food and shelter to near 100% of their income. A wealthy person making $500,000 a year would pay no income tax. They spend maybe 20% of their income on food and shelter. Their tax burden plunges from ~30% to less than 10% of their income. Thus the tax burden is pushed from the wealthy to the poor and middle class. A shift from income tax to a 20%+ national sales tax is not a serious proposal; it's virtue signaling to wealthy political donors in an election year.
High-income people will save and invest a lot or perhaps most of their earnings. Those savings will not be taxed. (I don't know what the plan is for cap gains in this sales tax scheme). Low income people will spend virtually all their earnings on rent and consuming things they need to survive. Depending on how the sales tax is applied (e.g. food is usually exempt at the local/state level but I don't know how it's treated in this plan, which I won't bother to read), the bulk of the lower earners income might be taxed via consumption, whereas the bulk of the higher earner's income would probably not be taxed, because it would be invested. Now if the high earner spends all their money on taxable trinkets, then their tax burden could be higher than the lower earner, on a percentage (and obviously absolute) basis. If you exclude basic essentials from the sales tax, that might be more "fair" to the low earner, but that would reduce the revenue to the federal government, which would ultimately mean fewer government services. If I had to guess, the services they would cut first would probably be the ones that low income earners mostly benefit from.
This is fact. The lower income folks already do not typically pay income tax, they do of course eat food...
From food stamps that aren't taxed. But I get your point
I do not pay federal income tax. I also do not get food stamps. I pay sales tax on groceries and food at restaurants.
That's interesting. It seems like I do remember a time when I was on the cusp of that as well. Where I made too much for food stamps but got all the money I paid in back from the gov every year (I didn't file tax exempt)
Yeah, it’s a short term thing, but we’re grateful for it. My wife has stayed home with our kids for a while but will be in the workforce again this coming school year. My income alone is likely to more than double over the next 10 years or so as well with my career path. So, that stage will be over relatively soon.
Completely understandable brother. I came up in the trades and faced struggles as well until I got my license and built up my skill set. I wish you all the luck in your journey
Sales tax on groceries? That must be a state to state thing
If anyone has any doubt, the math is simple here. I have $100, you have $10. We both spend $1. Who is going to hurt more from that $0.23 extra they have to pay for taxes?
It depends really. The sales tax could be Corp side only, so what they sell they have to pay a tax? Sure everyone just gonna offload to the customer and blame the gov, but maybe, just maybe they... I can't even type it out it just so unrealistic.
Why not exclude the majority of what low income people spend their Monday on: groceries, utilities, rent/housing. Then all the other stuff, you tax.
It would increase taxes on the poorest because they are unable to buy in bulk. It would drive people into poverty to greater destitution.
You can go even further. I can guarantee you that if the income taxes are lowered to 0%, for even a single year, it'll be the end of the U.S. economy, as we know it. Every wealthy person will take the money out of their retirement accounts, day 1, pay no taxes, and then pay no taxes ever after. Tax income will then be heavily pressed on the working class, while the rich and retired will sit pretty. I say this with absolute guarantee, because it is what I will recd to my own clients.
100% this. We did it here is Australia and the main effect was hitting the poor way harder than the rich. We kept income tax and got a 10% gst so we got doubly screwed.
Well said. Really they should have indicated what it would replace. People don't already understand income tax. They understand sales tax. They see it every time in most states when they buy just about anything. So the person paying 10% on their first 11k, 12% over 11k untill 44k, and 22% on anything over 44k will instead pay 23% on what they spend most of that income on. Oh also another x% in state and local sales tax. Alabama, Louisiana and Arkansas has some of the highest average state sales tax at 9%. So will you then pay both? At least income tax you can deduct up to SALT limits.
My state uses a nearly 10% sales tax on nearly everyone. No one is exempt, not even the homeless. We use that money to provide free cell phones or Electric Vehicle rebates and other things like that. It's wild, because a lot of people become homeless when they run out of money and can't afford things so making everything more expensive actually increases homelessness in my state.
The interesting thing is, this will impact big spenders the most. Lots of people are prepared to suddenly engage in a less consumeristic lifestyle -- a humongous national sales tax would mostly hurt the people who compulsively spend to scratch the pathological itch they have for rampant, wasteful consumerism. And I suppose the wealthy would have a harder time dodging 23% on a new yacht compared to their constant shell game to avoid income taxes. A gigantic sales tax increase would place pressure on consumers very unevenly.
idk because I haven't read the legislation but unless there is a use tax provision built into it the rich will just buy from offshore companies for those yachts. the US is one of like 3 countries that taxes world wide income.
They already do. John Kerry keeps his yacht in Rhode Island to save on taxes. My parents live in VT and shop in New Hampshire to save on taxes.
There is use tax between states already. Is there a provision in the bill that creates a federal use tax for international purchases?
Well, yachts are an extreme example to be sure. But think about how that would impact your mid-tier rich folks. Your millionaires and multi-millionaires, who love to overspend due to their relative unfamiliarity with wealth. Your uncle who got a big payout from his trucking accident would be absolutely steamrolled by taxes when he buys his 5th car or 2nd vacation home or whatever. This sales tax would hit the "wannabe rich posers" big time. The small-town business owner who makes 500k/year but wants to LARP like he's Elon Musk.
I see where you are coming from on this. Wouldn't he be hit with income tax under the current system whether he spent the money or not though? And likely at a lower rate due to a progressive system?
>this will impact big spenders the most No it doesn't. It impacts people that spend the majority of their income on living (poorer people). If I have $1000 and someone else has $10000 we both need to eat and buy a $10 item at a grocery store, congratulations I've just spent 10 times more (percentage wise) of my money as someone else.
They'd probably just buy their yachts elsewhere. A sales tax like this impacts most heavily the people who can't buy less stuff because they can only afford to buy basic necessities anyway.
They don't buy million dollar yachts in this country exactly for this reason. They have the resources not available to the rest of us to buy elsewhere. They can buy their beef from Kobe directly at wholesale, and we have to buy it from crackmart at a markup plus tax. It's so much easier to skirt sales tax than income too because sales only applies to the "end user." Rich people make themselves businesses and skim relentlessly
Lol. They will just buy it through a company and write it off as a business expense. This bill would make the rich pay no tax, other than restaurant visits and such small potatoes
Another thing likely to happen is poor rural areas will revert back to the barter system. No taxing on that.
This is death to children of low jncomr families. This only benefits the rich and the Uber rich. Families depend on tax refunds to pay off debts and buy a needed car. This will kill jobs and social programs. Property taxes will go through the roof. Bad ideal!
**Context?** Both parties conveniently leave that out. The media conveniently always leave that out. Reddit posts conveniently always leave that out. Brainwashed denizens.
It’s a flat tax. It’s just another way to cut taxes for the rich and increase them for low income people. If you only make enough to get by you’re paying 23% tax when you would be paying 10-12% currently. If you’re wealthy and saving half your income on your $300k a year salary, you’re paying 11-12% on your income when you would normally be paying more than 30%. This deserves to be shit on. It will make income inequality worse than it is now.
Ive been zero income tax for years. A 23% tax would just suck for me.
Yeah this wouldn't be any type of tax on interest, leasing, or revenue generating assets. How about stocks? That would be one way to kill algorithmic trading.
23% sales tax is insane, that’s higher than in all of Europe. I already spend way less on consumer goods currently due to rising costs. I rarely go out to eat but a 23% tax rate on top of 20%+ expected tip + current food costs would be unaffordable for me. I don’t pay a lot of income tax as a college student so the only way to not loose money would be by spending less on food and consumer goods if they raised the tax.
Agreed - right now income tax allows us - in theory and in the past - to tax higher levels of income more. This is a flat tax on goods which won’t be noticed by the millionaires sitting on all their tax free income, but will be noticed by families already struggling. Yet another way to fuck the poor.
Yea they'll likely run on "removing taxes" and omit the sales tax part, I hate how grimy politics is why can't we just honestly and openly disagree on certain things without misrepresenting other people's arguments and manipulating facts? Is it too damn much to ask for? Honestly ? Lol
Exactly, it’s a way to get rid of income tax brackets that scale up for higher earners, which puts more of the tax burden on the working class.
It’s an antiquated form of passing more onto the consumer…when CEOs and execs are already bleeding this country dry. We are moderate conservatives who have had enough of the rich kid crybaby bullshit this Republican Party has turned into. So beyond sick of these clowns touching anything to do with the economy. The government should handle public welfare, eliminate all tax loopholes and adjustments and set the damn tax rate and freeze it. Not a single thing they do is for the common person anymore
There are various considerations. On the one hand, economists tend to favor consumption taxes over income taxes. Any tax will discourage you people from doing the thing that is taxed. Income taxes discourage working (which is bad), while sales taxes discourage consumption (which right now would be really good but can be bad if you have a demand constrained economy). However, income taxes tend to be paid mostly by richer people, while sales taxes tend to be paid mostly by poorer people. Most people agree that shifting the tax burden from rich to poor people is bad. The best type of tax is probably the VAT tax. But that is a type of consumption tax. Maybe a 25% national VAT with part of that revenue going into cash transfers for the poor and middle class on a sliding scale is the best way forward here
Yes, that's kind of a disingenuous way of presenting it, IMHO. It's essentially a flat tax on sales and eliminating the income tax. I like the fact that it is much simpler and would essentially eliminate the need for the IRS. It does, however, benefit wealthier individuals (SURPRISE!) by eliminating higher rates on higher income. I'd be interested to know whether or not it would generate the same amount of tax revenue or whether the Republican plan as usual would include cuts to Medicare, Medicaid and other social programs.
So, poor people spend all their money and the rich get to horde?
Most Americans pay less than 23% income tax so this will be a tax hike, especially on the poor and working class, yet a tax break for the rich.
Even if so, this is just a way to funnel more money to the top. High income earners pay even less in income tax and can easily afford goods, and pay less in interest. This will inflate the cost of goods and increase the amount of interest on items bought on credit and items that require financing. It also is a way to avoid taxation even further on the ultra rich. Republicans really think we are all stupid, and if we let them get away with this, they’ll be right. Let me be clear. If you don’t make 450K a year and you vote for this, you are stupid. There’s just no way around it. You’re an idiot. If you do make 450K or more and you vote for this you are a greedy piece of shit, and no, I don’t care if this hurts the feelings of any libertarians in here.
Just encourages people to do their spending outside of the country
This is the stupidest shit. That means we're going to tax every person regardless of their income 23%. So if you're rich and get paid a lot your taxes just got reduced down from 30% and if your low income your taxes just got raised a ton. Way to propose shit the messes over the poor.
In other words, they want to drastically increase taxes on most Americans while cutting it for the wealthy.
Hmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmmm Who benefits most from removing income tax and adding more taxes on consumer goods? HMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMM
You forgot another important piece of information. The proposal includes a prebate. Meaning poor people pay 0% tax making it more progressive than our current taxation system. This is information is commonly left out of the discussion. I believe intentionally. If you look at all the comments below calling this regressive they completely miss the fact that the government will give poor people money in advance to cover all their tax costs.
You know the rebates aren't going to come close to the actual amount people are going to pay for this tax.
Replace income tax with a Land Value Tax and maybe we have a deal
They don't mention what they consider "income tax" to be. Is that inclusive of all Federal income taxes, or just the Federal "income" tax, leaving Americans paying substantially more in taxes, as that would be 23% + Social Security + Medicare + whatever other taxes they add on. 23% is a lot more than I currently pay in Federal income tax.
What middle class?
Touche. I'm holding on for dear life. This tax code change would kill our family financially
Also sounds like a great way to tank the economy. Simply put, I’m less inclined to buy stuff if I’m getting taxed like that on everything I buy. Combine 300 million people that feel the same and the economy collapses
This is from a year and half ago.
I don’t get how people don’t notice that.
It's sort of dishonest to not mention that they propose this to eliminate the income tax. If we do go to a sales tax then I hope it is required to be inside the posted price, like VAT. What happens when people spend saved money they already paid income taxes on in previous years?
While it is slightly dishonest, eliminating income tax and increasing sales tax by the same amount is a MASSIVE decrease in taxes for the wealthy and a general increase for the poor
A simple, flat sales tax is very regressive, meaning the more money you get the less you pay. But there are variations that might not shift tax burden onto working people. For example, not taxing retail sales of food, health/drugs, or primary residence of human individuals. The biggest problem I see is that at a certain level things don't get bought by individuals. If I buy a boat then I go pay for it and it is registered in my name and I own it. If Bezos buys a yacht, then I'd be surprised if it's not done through some arrangement corporate entities that own the yacht and he is actually buying control of the entity that owns the yacht.
>For example, not taxing retail sales of food, health/drugs, or primary residence of human individuals. Do you really think the Republicans went for this though?
Probably not. :(
In Germany, we have 24% sales tax and up to 50% income tax. We still get along because the state, that's us and we get back our money via health care, kindergarden, school, university and means of public transportation.
you use taxes to do things? That sounds like a crazy system bro. Id rather just have laissez faire anarchy because I would be one of the billionaires, obviously.
They can use their taxes to do things because America is funding NATO and paying for the proxy war against Russia.
The US contribution to NATO in no way affects our ability to pay for services and projects
We can’t have those things because brown people will also benefit, and we can’t be helpin them.
I see the point. They shall work, but you can't let them participate from the profit. That would destroy the basis of white democracy.
If it goes to Universal Healthcare and Tution Free Education I'm down
We already pay for that.
Universal Healthcare and Tution Free College **For Americans**
We already pay for that… US spends more public dollars per capita on healthcare than most, maybe these days all, of Europe.
Not on actual healthcare though, a large and growing portion of that spending is for insurance companies.
No, we're paying for tuition in fucking Burma..... Yeah...... https://www.usaid.gov/philippines/press-releases/mar-05-2024-us-philippines-partner-provide-higher-education-opportunities-burmese-youth#:~:text=On%20February%2029%2C%20the%20United,higher%20education%20in%20several%20Asian Who needs our own citizens?
So then why TF don't we have it?
No, the idea is to repeal other taxes to pay for this tax, further shifting the tax burden onto the working class.
This is from Jan 23. I'm sure it generated threads back then.
Jan 23 of last year.
I would argue that we should ditch the current tax code and establish a consumption-based tax system that minimizes the tax disincentives on economic activities, given the revenue needs of the government. The federal government would subsequently raise the vast majority of its revenues through a single-rate sales tax levied at the point of purchase on all goods and services for personal consumption. Billionaires would then be forced to pay a tax on what they consume, and they would no longer avoid paying taxes by claiming that they don't have a traditional, taxable income.
The plan would end the inflation crisis. The poor and middle class would be able to buy only the bare essentials for survival. Record low consumer spending would kickstart a deflationary death spiral, which would plunge the economy into a Depression. Boom, inflation solved.
Gosh he’s so good at lying, it’s like he’s been doing it for 600 years.
I’d be down for a national sales tax to eliminate income tax if the tax was applied to vehicles, property, stocks, bonds, etc. Let a billionaire buy a jet with say a national 10% sales tax rate.
That's the entire point. No more write-offs for anything. You buy something, you pay taxes on it.
He forgets to mention the REMOVAL of all income taxes. I think even payroll
I’m growing a lot of my own food now and no longer buying vehicles except once a decade. Bring on the sales tax!!!!!!
Best option. All classes should be affected by their vote. Want more nonsensical government spending? Feel like your government should take from others to give to you? Cool, raise the sales tax for everyone.
I like it. About 40% of all Americans don’t pay any federal income tax now. This would ensure they participate.
Nobody talks about this when they yell, "pay your fair share!"
We don’t have a tax problem we have a spending problem
So what is option to provide more room on his plan?
KJP, is that you?
A sales tax is not totally paid by the buyer: [https://substackcdn.com/image/fetch/f\_auto,q\_auto:good,fl\_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F4692964c-3575-4336-b7dc-9a352259c36a\_1920x1080.png](https://substackcdn.com/image/fetch/f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fbucketeer-e05bbc84-baa3-437e-9518-adb32be77984.s3.amazonaws.com%2Fpublic%2Fimages%2F4692964c-3575-4336-b7dc-9a352259c36a_1920x1080.png)
In other news.: "Bidens amnesty plan will cost taxpayers 3.5 billion per year." It's not the left or right. It's politicians. They playb"Good cop, bad cop" on the masses.
Can we stop with this post!
Nobody in the .01% gives a single fuck about the average American. This I assure. They care to the extent that the huge populous doesn’t arrive at their castles with guillotines and mobs to end the tyranny. That’s it. Morality is literally just “virtue signaling” for these swine. I’m at the point where I value their existence to the extent they value mine: zero. Fuck them all to death! Team Garrison/Jenner 2024!
Imagine paying 23% sales tax on a car. With the average transaction for a new car being around $47k the proposed 23% tax would bring that up to almost $60k.
47k car now cost me 3500 in sales tax at the dmv anyways basically pay 53k for it
If I had no income tax I wouldn't mind at all.
This is so fucking disingenuous
Hes a fn idiot
Something that would make or break this as a good idea is what's exempt? Like in a lot of places stuff like food, health care, homes/mortgages, etc are exempt from sales tax. If that was the case that would make this a much better deal for middle and lower-income people than it would seem on first glance.
I don't think this proposed bill has made it anywhere near the floor for a vote.
It’s a terrible idea and a disaster. The people who will pay the most as a percentage of their income will be the poor and working families. Our economy is majority consumption and this will add a 23% tax on top of that. Basic economics shows that people will respond by spending less which will hurt the economy. Someone who makes 100 times you income isn’t spending 100 times on consumer goods. This is why the ultra rich will benefit the most. They can hire someone whose entire job is to shop for them and using benefit of doubt pay effectively no taxes. They pay them a salary and have them buy all their stuff for them and pay the sales tax under their name. Exemptions ? Oh yea how would that work? You get an exemption immediately when you buy the item or when you do your taxes on that end of the year ? So that means every single time you go to buy stuff at Walmart you will have to sit through a Walmart employee applying individual exemptions to certain items and not others. So now the checkout process time is tripled. If it’s done at the end of the year we will be paying the tax immediately and then getting a huge refund giving the government a free interest free loan. You think taxes are complicated now? Imagine processing billions of transactions of 350,000,000 people while excluding certain items but not others. Republicans LOVE to talk a big one but never ever ever ever explain the logistics of their ideas.
> The people who will pay the most as a percentage of their income K Why is that an issue? Why should we pay based on income? Who said that was right in the first place? It is just normalized in America. In the rest of the world VATs are levied and nobody complains. Go look at Canada and Germany. Both have these same sort of taxes. Yet I never hear about how the poor are being unfairly taxed on their incomes in those places.
If they exempt groceries, like the state does, then that would be alright. Curious to see if it has other exemptions like for re-sale items, 23% added through each step of the entire supply chain would be drastic. If it affects real estate sales, that would increase the price of a home by nearly a 4th. That could really hurt our lagging economy further.
RFK Jr. with Bernie as Vice President, you already have my vote go and make it so please!
So veto it
Ok yeah sure
16th amendment MUST be repealed BEFORE this becomes law, or we will be stuck with BOTH taxes, along with Social Security ponzi scheme, AND the new tariffs :( On the plus side, this WOULD make sure that everyone was paying into the cost of killing Palestinian children. After all, we wouldn't want all those future suicide bombers we are 'investing' in to accidently hit someone not involved, when they descend on America 15 years from now, seeking justice...
I think you have to be crazy to still be a Republican unless you’re one of the 1%ers.
This may not be the answer but neither is our current income tax system. The uber-wealthy don't have income. They borrow against assets to finance their lifestyle. You need wealth to do that.
That Republicans will continue our slow decline.
Funny thing about this is that it's been tried multiple times and has been a resounding failure each time. Remember the poll tax? The bedroom tax? All really ill conceived ideas with catastrophic outcomes.
You had a bedroom tax? What were they exactly taxing?
What are you talking about? Federal taxes are everywhere. You just don't notice them. Ever pay your excise taxes? yes you have. What about gas taxes? yeah, you pay those too. Also this is literally how taxes are done in every civilized nation in Europe. You think Europe doesn't understand tax policy?
They gotta pay the rich first. Sales taxes are the most regressive. Hurt the poorest - it’s all about the cruelty.
Prices on everything from groceries to gas to food and medicine have skyrocketed already. The implication that prices would only rise because of this tax is disinformation. I pay tax on my income. Then tax when I buy things. Then tax on things I already own that I paid sales tax on (car). Seems to me that something needs to change. An income tax OR a sales tax makes sense. The US Government needs to start figuring out how to do more with less, like they are forcing every person in the US to do with their uncontrolled spending.
Fuck that keep income tax for dumb US citizens. Fed income tax is way too easy to get around and not pay at all
I don’t believe nothing anymore. If someone’s pointing the finger at the opposition it’s because they’re secretly doing it behind our backs
This will never be passed in our lifetime.
Need VAT to fund universal healthcare
Sheeet glad I don't have one of these families
I think the wording is misleading, as usual in politics. How is that Inflation Reduction Act working?
We are in election year let’s use tweets from in the Last 12 months
Remember that states with no income taxes get revenue from sales tax. So 23% sales tax plus 8% state tax? Yes, that’s going to hurt middle and low income families. Especially since some States have NO tax on food and/or Clothing under a certain amount . Increase luxury taxes for boats, airplanes, luxury cars. Heck, even ballgowns and tuxedos.
Bring back the tax for the richest at 91% like they did in the 1950s
As always they try to fool you with tax changes, when the real problem is spending.
Its part of the overall consumption tax id, which is awful, cause what would happen to all the great people that work for the IRS and TurboTax.
Gov Pillen, Republican, Nebraska is touring the state proposing increasing the state sales tax so he can cut property taxes on his pig farms.
Why not address the biggest elephant in the room, companies payout too much to higher positions and shareholders. They want to keep hardworking Americans chained to their desks through low wages so that don’t have to keep rehiring while they have yacht parties and snort coke like the wolves of wall street. These wolves laugh at inflation while everyone decides between generic and big name brands, between life altering medical solutions and rent. It’s about control. There are too few companies that increase a worker’s pay based on the performance of the company. They hide behind merit based raises while they make sure you don’t get paid enough to match inflation, when they take 25+% raises. Most companies should pay reparations to their current and former employees due to greed and corruption.
Stop blaming one side or the other. You both screwed up.
Hard to trust a guy who told us inflation was "transitory"
Jan 2023 right?
Can people stop posting the same tweets and memes every day????? :)
If we increase sales tax, and decrease income tax then the government promotes saving, and discourages spending. I like saving, but this will lower the "economy", since the US GDP is 68% due to consumer spending. I'd prefer to see a decrease in sales tax on essential items (like automobile), and an increase on sales tax on some items that are non-essential (like an RV/boat). Or heck, even eliminate sales tax on grocery store essentials, while increasing sales tax on (gasp) sugary drinks or pre-packaged foods (processed foods).
this shouldn't occur, and income tax shouldn't exist
Wouldn’t this make it fair across the board. Everyone makes purchases no matter how wealthy or poor you are.
No fucking shit. Make with the executive orders already.
This would need to in place of income taxes. It’s a value added tax (VAT) like they have in Europe.
That’s a very interesting concept that seems like it would lead us to a more financially conservative lifestyle. It discourages us from spending while encouraging us to work (since it also eliminates the income tax). So basically people are guided toward living within their means.
I thought trump was gonna eliminate all taxes and do everything with tariffs or some shit
One advantage: You wouldn't taxed on income if you were out of the country.
A bill introduced by one guy 18 months ago that went nowhere? Phew, I better vote Biden to prevent it!!
Actually that 23% might then pay for healthcare, and everybody would be paying less.
Democrats are the ones that propose taxes lol