Quote:
Originally Posted by Slava
How are they punitive?
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We're all capitalists here, right?
We want as much capital in the economy as we can, that means as much purchasing as possible.
If the end game is to be capitalists and have as much capital in play as possible, income taxes should be the highest priority, rather than taxes on commerce. By taxing consumption you encourage consumption reduction, which stifles the economy artificially.
By taxing income you encourage less hoarding of income in the form of savings. An individual can only spend so much money in their respective economy. You can only eat out so many days of the year, you can only go to so many concerts and buy so suits. Even the hyper rich can only buy so many houses and so many cars.
By reducing the amount of income that can be taken
out of the commercial economy, the more vibrant and diverse commerce will be.
Taxing commerce, a consumption tax, artificially removes potential purchasing power disproportionately against those who simply have less purchasing power to begin with.
Tax Murray Edwards more and he still buys the same amount of coffees at starbucks per year. Tax someone more every time they buy at starbucks, Murray will still be buying the same amount per year, but Locke, Slava and crazy_eoj might start cutting back on their visits as they tighten their belts.
This isn't some class warfare manifesto, it's the historical perspective on what the conditions were when Canada and the United States were at their greatest heights. There is evidence of what works, and mounting evidence of what doesn't. I'm not saying a consumption tax can't work or be applicable, but it's definitely not what I would look at first.