[cwhiz]

The tax problem is actually relatively simple to solve. Tax at the point of consumption. Unfortunately, people would rather have an ineffective game of cat and mouse where they FEEL like it's progressive, even though the rich still aren't paying.

[cmonagle]

Classic consumption taxes (sales taxes and VAT) tend to be quite regressive.

I haven't read the whole report, but this was studied in 2005[1] and they had to add a "Family Credit" (basically a UBI) of 500-1000$ per month to balance it out, and recovered approximately 65% of individual and corporate income taxes.

1. https://govinfo.library.unt.edu/taxreformpanel/final-report/...

[nullserver]

Sounds like the fair tax by Neil Bortz.

High sales tax on all “new” products. None on used. A check to everyone each month so that poor don’t suffer from it.

Basically eliminates the IRS, and much of the Tax compliance / avoidance industry. Stops a lot of the tax nonsense that corporations and congress loves.

[csunbird]

The problem with that is, people (usually rich people) will stop buying expensive stuff in the country, and they start buying them from another country that does not have any sales tax. Rich people avoid taxes and poor people are now stuck with the VAT on their daily needs.

[mcguire]

Or, as a government professor I once had said, "You can only eat so much filet mignon a day."

[ghaff]

Variants of that are even older. Here's one variant of a quote often attributed to Adolphus Busch: “You can only drink 30 or 40 glasses of beer a day, no matter how rich you are.”

[nullserver]

Tax purchases made overseas.

Tariffs are already used a lot.

[nemo44x]

Yeah more or less credit it back as a function of income by way of monthly payouts. At a certain income the credits begin getting phased out slowly. You can also tax different things at different rates. For instance, vegetables sound be taxed differently than yachts. It also lets externalities be taxed the entire lifecycle of the good or service.

[jerry1979]

I imagine that I would have a hard time listing out all the points of consumption. For example, I would include "filing to make a corporation" on the list. However, when the police come to protect my business from burglars, do I add that to the list? Or would a "daily protection" make more sense? Higher up the ladder, when our intelligence agencies trade favors in exchange for weapons contracts, should lockheed pay for that? Or should the workers at the bomb factory? Or the municipality in which the factory exits?

[throwaway2048]

consumption based taxes are an even larger boon to the rich since they consume so much less of their income.

[cwhiz]

This is predicated on the idea that the rich will pay their taxes if we just close all the loopholes.

If you polled the top brackets I think you'll find that they are more than happy to continue with our current tax system.

[solosoyokaze]

Are you suggesting that the rich would break the law and engage in tax evasion (not legal loopholes)?

A great portion of my taxes goes to military and police. Wouldn’t they just collect the money push come to shove? They certainly have the capability, but possibly not the will.

[g00gler]

It’s relatively easy to pay less taxes than your true compensation once you get past the rank-and-file level of employment.

As income taxes rise there’s a clear pattern of altered compensation like stock grants, expense accounts, etc.

For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes.

Instead of giving you $40,000 in cash which would cost 30% in FICA between you and the company plus personal income tax to you, you can live in a nice $3500/mo apartment you would otherwise be paying for in after tax dollars.

Instead of you paying $800/month+ for a Tesla model X lease with your after tax dollars the company can pay for it, write it off, and again they’re saving 15% on taxes and you’re saving > 40% on that $10,000 and pocketing more of your after tax income.

[gruez]

>For example, a company can lease an apartment for you to live in. That expense is a write off and isn’t subject to FICA taxes.

I'm not an accountant or a tax lawyer, but it doesn't look like that's the case according to the IRS's website. Housing is only exempt if it's "Lodging on your business premises"[1]. A tesla would also likely not be exempt for a typical office worker[2]

[1] https://www.irs.gov/publications/p15b#en_US_2021_publink1000...

[2] https://www.irs.gov/publications/p15b#en_US_2021_publink1000...

[sneeze-slayer]

Other countries solve this by taxing it as a "benefit in kind". It is compensation, and should be included in how one is taxed.

[filoleg]

It is a thing in the US too. For example, I have to pay income tax on the annual "fitness reimbursement allowance" the company provides for us.

Very simplified version: we can spend up to $1k/yr on fitness related expenses and get them reimbursement. We submit a reimbursement request, and if it gets approved, I get the money back in my account. The HR page explicitly warns that any reimbursement received will count towards your income tax.

[solosoyokaze]

I don't think you can tax the rich with income tax, for the reason you state. I think you need a wealth tax.