Replacing taxes with tariffs

[Cougarbear]

What do you think about this? How would it work?

 

[White 6]

I am against it.

 

[excalibur]

The income tax is the worst, getting rid of it will save Americans hundreds of billions a year that it costs to do all Federal taxes.

6.5 Billion Hours, $260 Billion: What Tax Complexity Costs Americans

(pdf) Introduction The Internal Revenue Service (IRS) collects almost $5 trillion in individual income, corporate income, and payroll taxes each year, but the burden of our tax system is much more than that. As painful as it can be to have to cut a check to the IRS every April, the process is...

www.ntu.org

 

[Jarlaxle]

Sadly, not possible.

 

[Concerned American]

I am against it.

Of course you are, but if Harris would have suggested it you'd have been all for it. You're as transparent as a freshly washed window.

 

[MisterBeale]

The Regressive Nature of the U.S. Tariff Code: Origins and Implications ​

Our findings are emblematic of a more fundamental feature of U.S. tariff policy: tariffs set to meet policy objectives of the past have persisted through vast changes in the economic landscape and, despite their historical origins, are still affecting consumers today.

https://www.cato.org/research-briefs-economic-policy/regressive-nature-us-tariff-code#

". . . The burden of a tax results from both the design of a tax and the true economic burden of a tax. A regressive tax is often flat in nature, meaning that the same rate of tax applies (generally) regardless of income. These taxes include most sales taxes, payroll taxes, excise taxes, and property taxes.

Because the same rate of tax applies regardless of one’s income, a lower-income individual may face a higher tax burden than a higher-income individual with the same amount of consumption. . ."

<snip<
". . . Analysis of imposed and threatened U.S. tariffs under the Trump administration (as of December 2018) shows that lower- and middle-income households experience relatively larger drops in after-tax income."

What Is a Regressive Tax?

A regressive tax is one where the average tax burden decreases with income. Low-income taxpayers pay a disproportionate share of the tax burden, while middle- and high-income taxpayers shoulder a relatively small tax burden.

taxfoundation.org

Both payroll and tariffs are regressive taxation. So it is sort of a mystery whether the poor and middle class blue collar folks that enabled Trump to win, will benefit or not at this point.

 

[Care4all]

HELL NO!

 

[MisterBeale]

". . . These estimates imply an annual loss for the United States of $51 billion due to higher import prices. However, a general equilibrium model imposing neoclassical assumptions implies a small aggregate real income loss of $7.2 billion. Hence, we find substantial redistribution from buyers of foreign goods to U.S. producers and the government, but a small net effect for the U.S. economy as a whole. We also document that U.S. tariffs protected sectors concentrated in electorally competitive counties, while foreign retaliations affected sectors concentrated in Republican counties. These spatial patterns generate heterogeneous effects of the trade war, and through model simulations we find that tradeable sectors in heavily GOP counties experienced the largest losses. Therefore, even though the aggregate impacts are small, the distributional effects are substantial.

We close with four important caveats. First, our analysis does not include an analysis of U.S. retail prices paid by final consumers. Second, we do not consider the impacts of trade policy uncertainty on the business climate. Third, our framework does not allow for country-level wage effects in foreign countries that would further affect the terms of trade. Finally, our analysis does not examine long-run impacts of the trade war. We believe these are important topics for future research. . . "

The Return to Protectionism​

The Return to Protectionism*

Abstract. After decades of supporting free trade, in 2018 the United States raised import tariffs and major trade partners retaliated. We analyze the short

academic.oup.com

 

[MisterBeale]

It would appear, where I live, tariffs will be a boon to my community.

I pity folks in areas w/o international corporations though, TBH.

 

[Cougarbear]

The Regressive Nature of the U.S. Tariff Code: Origins and Implications ​

Our findings are emblematic of a more fundamental feature of U.S. tariff policy: tariffs set to meet policy objectives of the past have persisted through vast changes in the economic landscape and, despite their historical origins, are still affecting consumers today.

https://www.cato.org/research-briefs-economic-policy/regressive-nature-us-tariff-code#

". . . The burden of a tax results from both the design of a tax and the true economic burden of a tax. A regressive tax is often flat in nature, meaning that the same rate of tax applies (generally) regardless of income. These taxes include most sales taxes, payroll taxes, excise taxes, and property taxes.

Because the same rate of tax applies regardless of one’s income, a lower-income individual may face a higher tax burden than a higher-income individual with the same amount of consumption. . ."

<snip<
". . . Analysis of imposed and threatened U.S. tariffs under the Trump administration (as of December 2018) shows that lower- and middle-income households experience relatively larger drops in after-tax income."
View attachment 1044639

What Is a Regressive Tax?

A regressive tax is one where the average tax burden decreases with income. Low-income taxpayers pay a disproportionate share of the tax burden, while middle- and high-income taxpayers shoulder a relatively small tax burden.

taxfoundation.org

Both payroll and tariffs are regressive taxation. So it is sort of a mystery whether the poor and middle class blue collar folks that enabled Trump to win, will benefit or not at this point.

I think there is something you are forgetting. Trump will cut the size and expenditures of the Federal Government. States will have to live within their means too.
This tariff taxation is very much like we would see with a national sales tax where everyone participates. Right now, the rich write off their expensive homes and toys. They won’t be able to with this method of taxation. And, the IRS will be mostly gone.

 

[White 6]

Of course you are, but if Harris would have suggested it you'd have been all for it. You're as transparent as a freshly washed window.

Nope. Wrote plenty of significant checks in my time, but on the years I did, I didn't really mind much as it marked me having a good year. I am not writing significant checks, but if you raise the price of everything I buy, so people that make a lot pay no taxes, I will not be amused.

 

[MisterBeale]

I think there is something you are forgetting. Trump will cut the size and expenditures of the Federal Government. States will have to live within their means too.
This tariff taxation is very much like we would see with a national sales tax where everyone participates. Right now, the rich write off their expensive homes and toys. They won’t be able to with this method of taxation. And, the IRS will be mostly gone.

The point of tariffs and protectionism is to protect national industry and promote growth of national self-sufficiency. They are not, and generally never have been primary revenue gathering sources.

The previous tariffs that Trump had levied, while protecting American industry, have not shown any growth. . . yet?

Folks that support tariffs want to protect American manufacturing and production, and also wish to foster the growth of domestic industry.

I have read that they haven't been very effective, but, from my PoV, it is very hard to measure what might have been if they had not been levied, and likewise, what percent of domestic production is protected and promoted. It might, in the end, all be in the mind of those who are doing the empirical analysis.

It is much more important for all of us to realize, that tariffs and protectionism are not, primarily used as a state revenue generating source.

Let us say that the tariffs ARE successful over the long run?

That would inevitably cause a decrease in revenue generated from them. This is just simple economics.

When I read your post, it appears to me you either didn't do very well in your Econ classes, or never had any TBH.

 

[pknopp]

Six of one, half dozen of another and he isn't going to do it.

 

[Doc7505]

Please note that it was a Democrat that designed the first tax programs aimed at the American citizen.

Read more:

1894 Income Tax and the Wilson-Gorman Tariff Act | Encyclopedia.com

1894 Income Tax and the Wilson-Gorman Tariff Act Norman Stein Source for information on 1894 Income Tax and the Wilson-Gorman Tariff Act: Major Acts of Congress dictionary.

www.encyclopedia.com

"1894 Income Tax and the Wilson-Gorman Tariff Act. Norman Stein. Prior to the Civil War (1861 - 1865), America's revenue needs were met primarily through tariffs, duties, and other consumption taxes. In 1861, however, Congress adopted an income tax aimed at the nation's most affluent to finance the Civil War.

**********​

The Progressive Income Tax in U.S. History

America’s founders rejected the income tax entirely, but when they spoke of taxes they recognized the need for uniformity and equal protection to all

fee.org

"In 1913, almost 20 years later, the ideas of uniform taxation and equal protection of the law for all citizens were overturned when a constitutional amendment permitting a progressive income tax was ratified. Congress first set the top rate at a mere 7 percent—and married couples were only taxed on income over $4,000 (equivalent to $80,000 today). During the tax debate, William Shelton, a Georgian, supported the income tax “because none of us here have $4,000 incomes, and somebody else will have to pay the tax.” As Madison and Field had feared, the seeds of class warfare were sown in the strategy of different rates for different incomes."
"It took the politicians less than one generation to hike the tax rates and fulfill Field’s prophecy. Franklin Roosevelt, using the excuses of depression and war, permanently enlarged the income tax. Under Roosevelt, the top rate was raised—first to 79 percent and later to 90 percent. In 1941, in fact, Roosevelt proposed a 99.5 percent marginal rate on all incomes over $100,000. “Why not?” he said when an adviser questioned him."

 

[MisterBeale]

Please note that it was a Democrat that designed the first tax programs aimed at the American citizen.

Read more:

1894 Income Tax and the Wilson-Gorman Tariff Act | Encyclopedia.com

1894 Income Tax and the Wilson-Gorman Tariff Act Norman Stein Source for information on 1894 Income Tax and the Wilson-Gorman Tariff Act: Major Acts of Congress dictionary.

www.encyclopedia.com

"1894 Income Tax and the Wilson-Gorman Tariff Act. Norman Stein. Prior to the Civil War (1861 - 1865), America's revenue needs were met primarily through tariffs, duties, and other consumption taxes. In 1861, however, Congress adopted an income tax aimed at the nation's most affluent to finance the Civil War.

**********​

The Progressive Income Tax in U.S. History

America’s founders rejected the income tax entirely, but when they spoke of taxes they recognized the need for uniformity and equal protection to all

fee.org

"In 1913, almost 20 years later, the ideas of uniform taxation and equal protection of the law for all citizens were overturned when a constitutional amendment permitting a progressive income tax was ratified. Congress first set the top rate at a mere 7 percent—and married couples were only taxed on income over $4,000 (equivalent to $80,000 today). During the tax debate, William Shelton, a Georgian, supported the income tax “because none of us here have $4,000 incomes, and somebody else will have to pay the tax.” As Madison and Field had feared, the seeds of class warfare were sown in the strategy of different rates for different incomes."
"It took the politicians less than one generation to hike the tax rates and fulfill Field’s prophecy. Franklin Roosevelt, using the excuses of depression and war, permanently enlarged the income tax. Under Roosevelt, the top rate was raised—first to 79 percent and later to 90 percent. In 1941, in fact, Roosevelt proposed a 99.5 percent marginal rate on all incomes over $100,000. “Why not?” he said when an adviser questioned him."

Yes, but at the time we did not have a gargantuan national debt, out of control entitlements, nor were we the policeman of the world.


All of these objectives will not, in the long run, be possible with the semi-socialist government we adopted with FDR.

 

[westwall]

What do you think about this? How would it work?View attachment 1044632

That's how the federal government funded itself before.

 

[pknopp]

Please note that it was a Democrat that designed the first tax programs aimed at the American citizen.

Read more:

1894 Income Tax and the Wilson-Gorman Tariff Act | Encyclopedia.com

1894 Income Tax and the Wilson-Gorman Tariff Act Norman Stein Source for information on 1894 Income Tax and the Wilson-Gorman Tariff Act: Major Acts of Congress dictionary.

www.encyclopedia.com

"1894 Income Tax and the Wilson-Gorman Tariff Act. Norman Stein. Prior to the Civil War (1861 - 1865), America's revenue needs were met primarily through tariffs, duties, and other consumption taxes. In 1861, however, Congress adopted an income tax aimed at the nation's most affluent to finance the Civil War.

**********​

The Progressive Income Tax in U.S. History

America’s founders rejected the income tax entirely, but when they spoke of taxes they recognized the need for uniformity and equal protection to all

fee.org

"In 1913, almost 20 years later, the ideas of uniform taxation and equal protection of the law for all citizens were overturned when a constitutional amendment permitting a progressive income tax was ratified. Congress first set the top rate at a mere 7 percent—and married couples were only taxed on income over $4,000 (equivalent to $80,000 today). During the tax debate, William Shelton, a Georgian, supported the income tax “because none of us here have $4,000 incomes, and somebody else will have to pay the tax.” As Madison and Field had feared, the seeds of class warfare were sown in the strategy of different rates for different incomes."
"It took the politicians less than one generation to hike the tax rates and fulfill Field’s prophecy. Franklin Roosevelt, using the excuses of depression and war, permanently enlarged the income tax. Under Roosevelt, the top rate was raised—first to 79 percent and later to 90 percent. In 1941, in fact, Roosevelt proposed a 99.5 percent marginal rate on all incomes over $100,000. “Why not?” he said when an adviser questioned him."

Back to arguing to not pay for our wars like when Bush argued to fight the wars "off the books"?

 

[Doc7505]

Yes, but at the time we did not have a gargantuan national debt, out of control entitlements, nor were we the policeman of the world.


All of these objectives will not, in the long run, be possible with the semi-socialist government we adopted with FDR.

~~~~~~
We had been recovering from a Civil War. Although Northern States were relatively untouched the South was devastated... The dollar cost was high for that time .
Then again it really wasn't until 1932 when Roosevelt came in that he began imposing taxes on Americans.
Did you know that food, clothing, and fuel were rationed, there was also a 10% tax on soap and cosmetics during WWII. But there was
Since 1940 taxes have become progressively higher each year,

Read more:

Revenue Act of 1935

The Revenue Act of 1935 was the first major effort of President Franklin D. Roosevelt and the New Deal to reform federal taxation. Part of the Second New Deal of 1935, it became known as the “Wealth Tax,” because Roosevelt sought a more progressive tax structure that would take proportionately much

www.worldhistory.biz

**********​

https://www.cato.org/blog/tax-increases-great-depression

 

[struth]

What do you think about this? How would it work?View attachment 1044632

Tariffs are a type of tax

The article is claiming trump wants to stop one certain rule of tax, one on income (what people produce) with another tariffs, (what is consumed)

Doubt it will happen since income tax is a constitutional amendment that would need to be repealed

 

[jbrownson0831]

Nope. Wrote plenty of significant checks in my time, but on the years I did, I didn't really mind much as it marked me having a good year. I am not writing significant checks, but if you raise the price of everything I buy, so people that make a lot pay no taxes, I will not be amused.

The price of everything you buy has been raised for 4 years, didn't you notice?