Katz said:
The first sentence implies that you believe the poor are paying an unjustly high percentage of their incomes in taxation of all kinds. I agree; but in your second sentence, you appear to support that structure and want to make it official tax policy, correct? This seems immoral."That means that the poor are paying the highest tax rates now because they spend the highest portion of their income. The most economically efficient tax therefore is to eliminate all taxes and only charge a national sales tax."
The inherent implication of the first part of my statement is that it's impossible to NOT have the poor pay the highest rates. However, logically there are three ways to correct it.
1) A good solution is the Fair Tax solution, in which there is a "pre-bate" where you get a check each month for your taxes below a certain income limit, like the poverty line. So if you make less then that, you pay no taxes and actually could make money.
2) A better solution would be that you just pay the sales tax and if you're poor and you apply for welfare, the sales tax would be considered in the calculation.
3) The best solution would be private charity where sales taxes are paid with your help.
BTW, keep in mind that prices would not go up, and would in fact drop. They would not go up because the taxes are already included in the price of products, the sales tax replaces those taxes, it's not in addition to them. And the reason prices would start to go down is all the cost of collecting those taxes, tax accountants and lawyers ... going away. And that would accelerate as the inefficient economic decisions driven by taxes goes away.