[Manuel_D]

What "high end electronics" would be taxed at a medium rate? Do billionaires not just use iPhones? Most high end private planes are the same models as regional jets (e.g. Embraer ERJ line), so a tax on them would still be mostly impacting normal folks' plane tickets.

The core problem remains the same: consumption does not scale with wealth. If we limit taxes go a handful of goods and services, then demand is just going to shift to something else. Consumption taxes give billionaires the option to drastically reduce their tax burden by consuming less. The lifestyle of someone with a $20 million net worth is not that much worse than someone with a $2 billion net worth.

[AnthonyMouse]

> Most high end private planes are the same models as regional jets (e.g. Embraer ERJ line), so a tax on them would still be mostly impacting normal folks' plane tickets.

Planes are the things airlines buy, not the things economy passengers buy. If you're conceding that taxes corporations pay get passed on to consumers then what does that imply about corporate income tax?

Also, poor people don't generally buy a lot of air travel.

> Consumption taxes give billionaires the option to drastically reduce their tax burden by consuming less.

Isn't that what we want? An incentive for the money to go to creating jobs or charitable donations rather than private jets and third mansions?

[Manuel_D]

Correct, corporate tax rates are generally regressive in their effect.

Building jets and houses creates jobs though. A more likely outcome of a consumption tax is that wealthy people simply spend less.

[AnthonyMouse]

> Correct, corporate tax rates are generally regressive in their effect.

Corporations can be shell companies. Whatever rate or tax you want to be applied to "the rich" has to be at least that high on corporations or "the rich" would just put their money inside a corporation and pay the lower tax. So it turns out all taxes are "regressive" at which point you might as well use the the simple, uniform, less distortionary ones (e.g. VAT) and then achieve different effective rates via transfer payments, the most efficient of which is a UBI.

> Building jets and houses creates jobs though.

That's assuming they're building houses instead of buying up the existing stock while restrictive zoning prevents more from being built. Moreover, jobs building private jets or satisfying other hedonistic consumption are less helpful than jobs building battery factories or growing food, even if they did employ the same number of people.

> A more likely outcome of a consumption tax is that wealthy people simply spend less.

The reason wealthy people don't spend most of their income is that they already buy whatever they want and then still have money left over. Bill Gates isn't going to buy an economy car instead of a luxury car over a sales tax.