CDZ Value Added Tax

[there4eyeM]

Regressive taxes always exploit the poor.

 

[Toro]

A VAT is a more efficient sales tax. It's why most economists prefer a VAT over most other taxes.

How the Value Added Tax Works

For the same of this discussion, I'll presume that the blatantly-deceptive example given here of the actual value of the tax is correct.

What this shows, and what I already said, I think, is that the tax is being collected at every step along the way. Everyone involved at every step has to collect the tax, and adds it to the cost of what is passed on to the next step.

At the end, using your numbers, when the shirt is sold to the final consumer, it includes a total of $2 in taxes, which are hidden from the consumer, so that the consumer does not know how much he's actually paying in taxes.

Compare this to a 2018 price tag. He takes it to the counter, and is charged an additional $2 in sales tax, bringing is total cost to $22. He knows how much the shirt actually cost, and he knows how much government took from him in sales taxes on that shirt.

By the way, a $2 on a $20 item would be 10%. i live in California, the state with the highest sales tax, and some localities impose a bit more above that. I don't think the total sales tax anywhere in California is as high as 9%. Even California wouldn't try to get away with imposing a 10% sales tax. At least not openly. That's the real intent, and effect of a VAT, to hide the tax so that consumers don't know how much they are being fleeced by it. And if you think a VAT, imposed in this country, wouldn't end up being a lot more than the 10% in your example, then you're a gullible idiot. That's the whole point of hiding the tax from the consumers, to be able to get away with imposing higher taxes than the public would tolerate if it was done openly and honestly.

As for a VAT being “ more efficient sales tax”, I think this is very obviously false. A sales tax is collected at one point, the final point of sale, all at once. A VAT is collected at every step, imposing the burden on every producer along the way to collect it. It's certainly more efficient to collect it all at one point, than to nickel-and-dime every producer at every step.

Your argument about transparency is a different one than economic efficiency. I've lived in jurisdictions that have a VAT. Everyone knows what the rate is.

And clearly, the 10% is a simple example to make the math easy. An intelligent person would realize this, not that its an argument for a specific level of taxation.

Taxation systems that rely on sales tax deal with the issue of "cascading," i.e. that sales are taxes are paid in the supply chain and rebated back to the wholesaler. That doesn't happen in the VAT. This is why it is more efficient, and why most economists prefer them. It also helps avoids tax evasion.

The value added tax system, unlike the conventional sales tax system, efficiently addresses the problems of cascading and input tax credit that causes an automatic hike in the consumer price level. The incidence of cascading is avoided in VAT as the tax is imposed on the value addition at every stage of production. The final consumers are the ultimate bearers of the burden. This indirect yet coherent form of taxation involves transparency and is therefore easily comprehensible.​

Difference between Value Added Tax (VAT) and Sales Tax | Economy Watch

 

[Bob Blaylock]

As for a VAT being “ more efficient sales tax”, I think this is very obviously false. A sales tax is collected at one point, the final point of sale, all at once. A VAT is collected at every step, imposing the burden on every producer along the way to collect it.

It's more efficient from the viewpoint of the collector. Reduces tax evasion.

No, not really.

Assuming the same amount of tax to be collected, it is much more efficient to collect it all at one point, than to collect it in smaller bits at many points.

The only real advantage from the tax collector's vantage is that because a VAT is hidden from the consumer who actually pays it, as opposed to a standard sales tax that is out in the open so that the consumer can clearly see how much he's being taxed, the tax collector can get away with imposing a higher tax rate before the consumer will notice how much he's being fleeced. That's why big-government statist kleptocrats like the VAT so much.,

 

[Bob Blaylock]

Your argument about transparency is a different one than economic efficiency. I've lived in jurisdictions that have a VAT. Everyone knows what the rate is.

And clearly, the 10% is a simple example to make the math easy. An intelligent person would realize this, not that its an argument for a specific level of taxation.

Taxation systems that rely on sales tax deal with the issue of "cascading," i.e. that sales are taxes are paid in the supply chain and rebated back to the wholesaler. That doesn't happen in the VAT. This is why it is more efficient, and why most economists prefer them. It also helps avoids tax evasion.

The value added tax system, unlike the conventional sales tax system, efficiently addresses the problems of cascading and input tax credit that causes an automatic hike in the consumer price level. The incidence of cascading is avoided in VAT as the tax is imposed on the value addition at every stage of production. The final consumers are the ultimate bearers of the burden. This indirect yet coherent form of taxation involves transparency and is therefore easily comprehensible.​

Difference between Value Added Tax (VAT) and Sales Tax | Economy Watch

Toro mierda.

 

[Toddsterpatriot]

As for a VAT being “ more efficient sales tax”, I think this is very obviously false. A sales tax is collected at one point, the final point of sale, all at once. A VAT is collected at every step, imposing the burden on every producer along the way to collect it.

It's more efficient from the viewpoint of the collector. Reduces tax evasion.

No, not really.

Assuming the same amount of tax to be collected, it is much more efficient to collect it all at one point, than to collect it in smaller bits at many points.

The only real advantage from the tax collector's vantage is that because as opposed to a standard sales tax that is out in the open so that the consumer can clearly see how much he's being taxed, the tax collector can get away with imposing a higher tax rate before the consumer will notice how much he's being fleeced. That's why big-government statist kleptocrats like the VAT so much.,

Assuming the same amount of tax to be collected, it is much more efficient to collect it all at one point, than to collect it in smaller bits at many points.

Easier to fraudulently divert products before the final sale than it is to divert from the intermediary steps.
Plus, there are usually fewer larger suppliers compared to more, smaller retailers.
For example, 4 companies making toilet paper and paper towels, versus thousand of retailers selling them.
A couple of big cereal companies versus thousands of retailers.

a VAT is hidden from the consumer who actually pays it,

Yes, a VAT is more hidden.

 

[Toro]

Toro mierda.

i.e., You concede the argument.

Good choice.

 

[Toro]

I ask because I'm trying to understand all the various candidates for the Democratic Primary.

Here is why I asked.

Andrew Yang, Democrat for President on Value Added Tax.

Value-Added Tax - Andrew Yang for President

It's not a new idea. Rand Paul and Ted Cruz promoted it in 2015.

Value-Added Tax Catches On in Republican Presidential Race

 

[Darkwind]

Okay, Hit Me with your best for/against arguments regarding a VAT.

The problem is that large corporations like Amazon are able to find ways to hide their profits from the US Government. In fact, Amazon has a profit of $11 billion and they actually paid zero taxes. Meaning of course, that when the filed their taxes, their amount owed/paid reached a $0.00 number.

A Value Added Tax is one in which Amazon and other large corporations, would be required to pay a tax up front for the product/service they provide. This would be a tax that is not deductible from their overall tax burden and the entire amount would go to the Feds.

So, what say you all?

So you're willing to pay more for everything just so Amazon pays a little more tax?

I'm not.

Did you read anything? I am asking for information, I am NOT against or endorsing anything.

 

[Bob Blaylock]

Toro mierda.

i.e., You concede the argument.

Good choice.

 

[Toro]

Toro mierda.

i.e., You concede the argument.

Good choice.

View attachment 260603

Second straight irrelevant post = you have no argument.

Which, if you understand the issue, is expected.

 

[Picaro]

Okay, Hit Me with your best for/against arguments regarding a VAT.

The problem is that large corporations like Amazon are able to find ways to hide their profits from the US Government. In fact, Amazon has a profit of $11 billion and they actually paid zero taxes. Meaning of course, that when the filed their taxes, their amount owed/paid reached a $0.00 number.

A Value Added Tax is one in which Amazon and other large corporations, would be required to pay a tax up front for the product/service they provide. This would be a tax that is not deductible from their overall tax burden and the entire amount would go to the Feds.

So, what say you all?

Some here seem to be oblivious to the fact you're talking about the Federal income taxes and not all taxes such as state and local taxes for some reason, and yes many corporations pay nothing in Federal taxes or even get back billions in 'rebates' and the like, as GE and others sometimes do.

VAT taxes are collected at several stages, driving up retail prices and pushing them off on consumers, at least in theory. Taxes on capital gains and profits only get collected if there is a gain or profit realized, and don't add a cent to consumer prices, despite the claims here otherwise. Sales taxes of course are state taxes, and are a different topic, but do add to consumer costs. Taxes on gains and profits are a much better thing for the economy than VAT taxes which are collected regardless of any gains made, and would restrict businesses unnecessarily and prohibitively by draining off capital investment and operating revenues.

 

[Blues Man]

Okay, Hit Me with your best for/against arguments regarding a VAT.

The problem is that large corporations like Amazon are able to find ways to hide their profits from the US Government. In fact, Amazon has a profit of $11 billion and they actually paid zero taxes. Meaning of course, that when the filed their taxes, their amount owed/paid reached a $0.00 number.

A Value Added Tax is one in which Amazon and other large corporations, would be required to pay a tax up front for the product/service they provide. This would be a tax that is not deductible from their overall tax burden and the entire amount would go to the Feds.

So, what say you all?

So you're willing to pay more for everything just so Amazon pays a little more tax?

I'm not.

Did you read anything? I am asking for information, I am NOT against or endorsing anything.

And I gave you information.

The VAT will raise the price of everything at the consumer level and companies like Amazon will pay no additional tax. We will pay it.

 

[sparky]

Ask what makes any economy viable ,sustainable, prosper, flourish ?

If you conclude that gub'mit sets parameters for the biz community to operate within , then you subscribe to the double edged sword of their intervention, be it regulatory, taxation , bureaucratic oversiight, etc....

The alternative being the free market ,no gub'mit need apply, biz assuming self regulating meritocracy.

Then look at the bigger pix.

GND has outrun GDP

basic analogy being a household that spends more than it earns, ripe for bankruptcy, foreclosure, etc....

~S~

 

[Bob Blaylock]

Taxes on capital gains and profits only get collected if there is a gain or profit realized, and don't add a cent to consumer prices, despite the claims here otherwise.

Any taxes imposed on businesses will ultimately result in higher prices for the consumer. Businesses have to take all costs into account, in setting their prices. This includes taxes, as well as the cost of regulatory burdens.

 

[Picaro]

Taxes on capital gains and profits only get collected if there is a gain or profit realized, and don't add a cent to consumer prices, despite the claims here otherwise.

Any taxes imposed on businesses will ultimately result in higher prices for the consumer. Businesses have to take all costs into account, in setting their prices. This includes taxes, as well as the cost of regulatory burdens.

How are they going to know what their taxes are when they're don't even know if they're going to pay any in the first place? I set my contract prices on what I could get the market to pay for my services, not what my possible income and capital gains taxes might be. So do most businesses. With all the tax deductions and income deferment schemes around, and with the lowest tax rates since WW II, I don't worry about that much, and certainly not when pricing my services. My biggest concern by far, as for most businesses, isn't Federal tax rates but getting more customers able to pay decent prices.

Many wage earners don't make enough to qualify for many of the schemes and shelters available to the middle class and upper income brackets already, which is why all these 'Fair Tax' scams are a joke. Even Trump once proposed a one time wealth tax on the top 1% brackets of 14.5%, which included himself at the time, to pay off the national debt. The financial sector is too parasitic, and draining off productivity gains to the extent the domestic economy is almost hollowed out, and not producing anything but crappy low productive service jobs. That has to turn around, as well as building our manufacturing sector back up to where we can again see to our national defense; we can't rely on our enemies to supply us; that's absurd.

 

[Staidhup]

Sorry to say a one time 14.5% wealth tax will not cut the national debt.
The VAT in exchange for what?

 

[Picaro]

Sorry to say a one time 14.5% wealth tax will not cut the national debt.
The VAT in exchange for what?

It would come close when Trump proposed it when he ran for President the first time. But yes, the Republicans have ran it up several times more than it was back then.