[drewgross]

Even a flat tax on consumption (like the sales tax) is regressive in effect, because the poor spend a greater fraction of their income on consumption. Now, if you suggested a high tax on luxury goods and services, and no tax on necessities like unprepared food, basic clothes, etc. I might be able to get behind that.

[meric]

It means the marginal tax rate for each dollar a person spends in a year increases with the number of dollars they spend.

An example of a progressive consumption tax bracket:

Dollars spent, marginal tax rate.

$0-$5000: 0%

$5001-$10000: 10%

$10001-$30000: 15%

$30001-$80000: 27%

$80000-$120000: 35%

$150000+: 40%.

So if a person spends $15000 a year, they have to pay an additional $1250 in tax.

They can spend on food, clothes, luxury boats, and are taxed according to the number of dollars they spend.

I don't see how that is regressive in anyway.

This way, as long as the spending of two people are the same, a person who makes and spends $20k a year, and a person who makes $80k and spends $20k a year, and works 5x harder, are both taxed at the same rate. This removes the disincentive to work hard while being frugal.

You can also pair this with a "Universal Basic Income" later on - e.g. first $10000 of spending in a year is -100% tax, meaning completely subsidised by the government.

Welfare could be means-tested on spending rather than income, so folks don't have to worry about losing welfare when they get a job.