Gnads wrote on Jun 20
th, 2018 at 8:23am:
freediver wrote on Jun 19
th, 2018 at 9:07pm:
Economists recommend that tax systems be designed so that they do not 'skew' the market. That is, so that the market differs as little as possible from what it would look like if it were untaxed. There are a few main strategies to do this:
1) Spread the tax as thinly and evenly as possible - GST.
2) Tax items with a low price sensitivity. That is, things that people would buy roughly the same amount of regardless of price - drugs, alcohol, income, tampons, cancer medication etc. This is also why they advise against a luxury tax on things like yachts. Rich people will just spend their money on something else ('substitute' goods, eg an overseas holiday), but you will kill jobs in the yacht making business.
3) Tax an industry you actually want to slow down, and would have to otherwise regulate some other way - carbon taxes, eco taxes, the green tax shift concept. Drug and alcohol taxes come under both 2 and 3.
The GST doesn't apply to everything ... so why should it apply to something only half the population require for a (excuse the pun) period of their life?
It's not like they have a choice about whether to buy them or not.
Furthermore if the Federal govt were fairdinkum about taxation & taxation reform they would force all states that have kept taxes like "sales tax", "land tax" etc. to drop them as when the GST was introduced these taxes were supposed to be removed.
That does not make sense. The GST should apply to everything. Fresh fruit, tampons, etc. That it does not apply to everything is not a rational argument.
Quote:Better selection - transaction tax with a few exemptions such as pensioners and unemployed, or maybe on certain transactions. That'll plug up your overseas trips etc loophole.
That is one of the worst possible ideas. It would destroy the finance industry without raising much revenue, because people would just find a way to avid paying it.
Quote:As for what economists say, who gives a big fat F what those f'rs say?
People who like to keep their job.