Brad DeLong: "As the late Milton Friedman liked to put it: to spend is to tax. If the government buys things, it must get the money to buy them from somewhere. It can get the money from three places. It can tax. It can borrow - but then the borrowing has to be repaid with interest, and the more is borrowed the higher the interest and the worse the value the taxpayers ultimately get for their money when they are taxed to repay the borrowing. Or it can print the money and so inflate the currency - but that too is a tax, and an especially unfair, painful, and destructive one, as lots and lots of people victimized by inflation find their wealth doesn't buy what it used to and what they expected." (reply)
Tim Dunlop and Andrew Leigh argue for windfall taxes on the mining industry. I don't like them, they are too much related to arbitrary government and punishment for economic activity. Economic rules and regulations should be consistent and not subject to the whim of populism, demagoguery or punishment for economic success. (more)
I just did my quarterly taxes and once again it was a frustrating exercise in complexity and confusion. To add to the concern my tax software has not been correctly working out my income tax. I did it manually and found I had a significant liability. So now I am going to have to go begging to the state tax office to try and avoid penalty fees. I am not amused.
The tax system needs to be simplified. Progressive income tax scales are a good idea but they are complex especially when done at several levels. Property taxes are actually easier for me to pay and work out than income taxes. Because I am consulting I do not have to deal with service/consumption taxes directly so I do not have an informed opinion on that.
What would premier cam do [WWPCD] if given the keys to the NSW Cabinet? (more)
The counties, cities and towns in the US raise most of their revenue by property taxes. The county I am in leverages property taxes on my house, my car and my business assets. Along with the bill for my car taxes the county sent this handy little breakdown of their budget and where the money is going and coming from. (more)
Joshua Gans mentions an RAC plan to tax based on distance travelled where the data is collected by GPS, and also mentions that there needs to be some 'distance' pricing to account for congestion. The answer must be no. The government does not get to track us, certainly not by GPS. It is bad enough having to travel through political boundaries - even now the US wants to fingerprint people as they leave - allowing that kind of domestic surveillance through GPS collected taxation; no. Liberty must come first. (more)
I am not a fan of the GST. I consider it an anti-federalist tax. I would accept it if it was funding the federal government, but since it is redistributed to the states, and not one for one, it breaks the principle of a government only raising the revenue it needs to support itself and nothing more. (more)
In the days of the silk road, production and manufacturing were a craftsman's era. No two objects were the same and essentially unique. It was art more than production and would fail any modern manufacturing quality control scheme. The industrial era came not too long after the technology of banking was refined - which was fortunate - as industrialism is a capital intensive enterprise. With the digital age we are moving back into a craftsman's era, though this time with the lessons of industrial quality control. How should the tax system change to meet these economic movements?
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A couple of Net Tax graphs from the
2004 Taxation Statistics
. The graphs are specifically from this table;
One percentile distribution, by taxable income, 2003-04 income year
.
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In 2001, the United States taxed their population to the tune of 2.11 trillion. Of that 345 billion was uncollected, with 244 billion of it being individual income tax. This is known as the
"tax gap"
and is defined by the IRS as; "the concept of the tax gap as a way to gauge taxpayers' compliance with their federal tax obligations. The tax gap measures the extent to which taxpayers do not file their tax returns and pay the correct tax on time." I could not find much in the way of data on tax compliance in Australia.
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The report by the Treasury on
International Comparison of Australia's Taxes
contains a bunch of graphs that put Australia's taxation policies against OECD countries. There is a tonne of data, recommendations and comparisons in this report. An interesting graph shows Australia's tax break down on income and payroll tax.
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