>I'm not against income tax because there are other uses for money besides
>purchasing goods and services. Failure to tax people who use money to make
>money and gain power is not fair.
As you mentioned, most consumption based taxes fail to tax those who use
money to make money. This includes the VAT, GST, and Sales tax imposed by
many states as well as the so called "Import Duty" we pay here for almost
all imports (which is just about everything except food).
But in the US (and here in Puerto Rico) these consumption based taxes are
simply an additional tax paid by all consumers on all goods (and in many
places services as well). It is in addition to a federal income tax and in
many jurisdictions, a state income tax.
But Dale, both the consumption based taxes and the income tax fail to tax
those who use money to make money. Capital gains are not taxed by either,
but are often taxed at a much lower "Capital Gains Tax" rate, or as in the
case of interest on municipal bonds, not taxed at all. So the middle class
and poor end up paying the lion's share of the tax burden at all levels
while the super rich pay little or no tax on their earnings.
Maybe there should be a special tax on non-renewable energy use and on
pollutants. But the only fair general tax would be a flat rate income tax
that taxes ALL income, from ALL sources. That way everybody would pay the
same percentage of their income, regardless of the source.
--Dan in Sunny Puerto Rico--
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