|
Well, we by and large don't say that people should be taxed more for spending their money. The US's main tax revenue comes from an income tax, not a consumption tax. There are three basic ways to tax people: 1. On Income This is the way that most tax revenue comes in to the US. It says, "When you make $100, the government takes, say, $20 of it. And then the remaining $80 is entirely yours." 2. On Wealth. This is how, say, property taxes work. "When you make $100, the government takes, say, $10 of it this year. Next year, if you still have the $90, the government takes another $8 of that. The year after that, if you still have the remaining $82, the government takes another $7 of it. The year after that, if you still have the remaining $75, the government takes $6 of it..." 3. Consumption taxes. This is how sales taxes and VAT taxes work. "If you get $100, it's all yours. But if you SPEND say $50 of it, the government takes $10 of that." The common argument in favor of income taxes is that wealth taxes just make sure that people buy frivolous crap instead of saving, because saving is penalized, and that consumption taxes tend to be regressive because the rich just can't/don't spend all that much of their money (there's a limit to how richly it is possible to live), while the poor must spend all of their money. So the poor get taxed on a greater percentage of their income than the rich. |