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From: John Larkin on 14 May 2010 11:41 On Fri, 14 May 2010 07:56:31 -0700, Joerg <invalid(a)invalid.invalid> wrote: >Bill Sloman wrote: >> On May 14, 12:39 am, John Larkin >> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: > >[...] > >>> That's the way sales tax works in California. If I buy uncooked >>> chicken at Safeway, there's no sales tax. If I buy cooked, hot, >>> ready-to-eat chicken, it's taxed. It's simple, because it's a visible, >>> automated-cash-register, point-of-sale tax. Restaurant food is taxed >>> whether you eat it there or not. I can't imagine how you could work a >>> thing like this all the way back up the VAT chain. >>> >>> It would be easy to structure a national sales tax to exempt the >>> things poorer people actually need. There would be some cheating >>> around the edges, but there always will be some cheating. But things >>> like VAT carousel fraud couldn't happen. >>> >>> (One shop near here sells " *WARM* " corned-beef sandwiches because >>> hot ones have a higher tax rate.) >>> >>> I like the sales tax, as opposed to income tax, because it puts >>> business on a better basis against imports, so saves jobs. And because >>> it would be enormously simpler and cheaper to comply with. No >>> accountants, no tax returns, no exemptions, no deductions, no >>> quarterly estimates, no loopholes... almost. >> >> Dream on. Why do you think that VAT was invented? >> >> http://en.wikipedia.org/wiki/Value_added_tax >> > >The usual. To squeeze ever more taxes out of people. Whether you call >them VAT, fees, surcharges, carbon credits or whatever, a tax is a tax >is a tax. But some taxes require you to hire an army of bookkeepers and CPAs and attorneys just to figure out how much taxes you should pay. Luckily, all their fees are tax-deductable. This year, we will spend more on the droids than we will pay in taxes. John
From: John Larkin on 14 May 2010 11:44 On Fri, 14 May 2010 07:39:56 -0700, Joerg <invalid(a)invalid.invalid> wrote: >John Larkin wrote: >> On Thu, 13 May 2010 15:12:11 -0700 (PDT), Bill Sloman >> <bill.sloman(a)ieee.org> wrote: >> >>> On May 13, 6:32 pm, John Larkin >>> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: >>>> On Thu, 13 May 2010 07:32:26 -0700 (PDT), dagmargoodb...(a)yahoo.com >>>> wrote: >>>> >>>> >>>> >>>>> On May 13, 4:39 am,Bill Sloman<bill.slo...(a)ieee.org> wrote: >>>>>> On May 13, 1:51 am, dagmargoodb...(a)yahoo.com wrote: >>>>>>> On May 12, 5:48 pm, "krw wrote: >>>>>>>> On Wed, 12 May 2010 09:34:59 -0700 (PDT), dagmargoodb...(a)yahoo.com wrote: >>>>>>>>> Maybe. A 10% VAT would raise $1.5T a year, enough to pay for Obama's >>>>>>>>> permanent spending bender on...whatever it was we got for all that >>>>>>>>> dough he spent--I can't remember. >>>>>>>> *Maybe*. The deficit for just April was $83B. Note that April is also the >>>>>>>> month when the government intake is *highest*, do to the April 15 tax filing >>>>>>>> date. In 43 of the last 56 years April has been a net surplus month. >>>>>>>> <snip> >>>>>>> A 10% VAT gives Obama $125B more/month to fritter away on nothing. >>>>>>> (Enough for break-even, not enough to pay off any debt.) >>>>>>> Of course that assumes people continue to buy stuff at the same rate, >>>>>>> which they won't. They won't work at the same rate either. Better >>>>>>> make it 18%, like Europe. And, naturally, that won't be enough >>>>>>> either. He'll spend more. >>>>>>> That said, Obama won't push a VAT--it doesn't redistribute wealth. >>>>>>> Deficit spending does. >>>>>> Actually, VAT does redistribute wealth - away from the poor towards >>>>>> the rich. The poor spend most of their income on buying stuff, which >>>>>> attracts VAT. >>>>> True. >>>>>> The rich divert a larger part of their income into investment, which >>>>>> doesn't attract VAT. >>>>> Naturally. As a nation, we spend 10% of our time and creative energy >>>>> figuring out how to pay our taxes, and 5% (maybe more) planning the >>>>> course that minimizes them. >>>>>> Technically speaking, this makes VAT is a >>>>>> regressive tax. >>>>> In the US we have a proposal called "The Fair Tax," a simple 23% >>>>> national sales tax. It would replace all of our federal tax system >>>>> (personal and corporate income tax, Medicare, Social Security, etc), >>>>> and eliminate all the credits, deductions, receipts, bookkeeping and >>>>> time spent dodging & gaming the various income taxes. The latter >>>>> costs us hundreds of billions a year, not to mention human energy >>>>> wasted unproductively. >>>>> A simple "prebate" makes the Fair Tax progressive. >>>> Just exempt basics, like sensible food, reasonable rent, generic >>>> medicines, public transport, education, stuff like that. Use tax >>>> policy to steer behavior. >>> They tried that in the UK. It rapidly got silly. Food was VAT-exempt, >>> but eating in a restaurant was not a necessity, so you had to pay VAT >>> on the bill - unless you bought a take-away meal. >> >> That's the way sales tax works in California. If I buy uncooked >> chicken at Safeway, there's no sales tax. If I buy cooked, hot, >> ready-to-eat chicken, it's taxed. It's simple, because it's a visible, >> automated-cash-register, point-of-sale tax. Restaurant food is taxed >> whether you eat it there or not. I can't imagine how you could work a >> thing like this all the way back up the VAT chain. >> > >Actually, Countries in Europe have that in the VAT system. IIRC Germany >has several VAT levels, the one on uncooked food and groceries is around >half of the regular rate. Which is sky-high to begin with and, of >course, they also have an income tax. > > >> It would be easy to structure a national sales tax to exempt the >> things poorer people actually need. There would be some cheating >> around the edges, but there always will be some cheating. But things >> like VAT carousel fraud couldn't happen. >> >> (One shop near here sells " *WARM* " corned-beef sandwiches because >> hot ones have a higher tax rate.) >> >> I like the sales tax, as opposed to income tax, because it puts >> business on a better basis against imports, so saves jobs. And because >> it would be enormously simpler and cheaper to comply with. No >> accountants, no tax returns, no exemptions, no deductions, no >> quarterly estimates, no loopholes... almost. >> >> Tax consumption. Don't tax savings or investment or job creation. If a >> person is rich but doesn't spend any money, nobody can reasonably be >> jealous of his wealth. >> > >A serious problem with that: It punishes frugal people who have saved >for their retirement and rewards those who squandered everything. The >money they saved _has_ already been taxed. Simple fix: don't tax income. John
From: John Larkin on 14 May 2010 11:50 On Fri, 14 May 2010 08:31:48 -0700, Joerg <invalid(a)invalid.invalid> wrote: >John Larkin wrote: >> On Fri, 14 May 2010 08:50:11 +0100, Martin Brown >> <|||newspam|||@nezumi.demon.co.uk> wrote: >> >>> On 14/05/2010 05:12, krw(a)att.bizzzzzzzzzzzz wrote: >>>> On Thu, 13 May 2010 21:03:14 -0700 (PDT), dagmargoodboat(a)yahoo.com wrote: >>>> >>>>> On May 13, 10:21 pm, "k...(a)att.bizzzzzzzzzzzz" >>>>> <k...(a)att.bizzzzzzzzzzzz> wrote: >>>>>> On Thu, 13 May 2010 19:08:20 -0700, John Larkin >>>>>> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: >>>>>>>> VATs tend to be sales taxes, in reality. >>>>>>> VAT is applied all up and down the production chain. So the only stage >>>>>>> that can be selectively taxes is the last one, at point of sale. I >>>>>>> prefer a true 100% visible point of sale sales tax. VAT is designed to >>>>>>> hide the actual taxation level, at considerable cost of complexity. >>>>>> That's the theory but in practice, AIUI, VATs are only collected at the end of >>>>>> the pipe. >>>>> No. They're charged and credited throughout the chain. Your thing >>>>> gets taxed, then rebated and the next guy pays, then gets his rebate, >>>>> etc. >>>> So it's only collected at the end. >>>> >>>>> Maximum work for everyone. Maximum intrusion. Horrible. >>>> A lot of work, sure, but money only changes hands at the end of the pipe. >>> No. You have it wrong. Every stage in the pipeline *pays* VAT inclusive >>> prices to their suppliers and totals up their input tax and then charges >>> their customers including VAT and totals up their output tax. Then >>> every month if large or three months if a small company you send a VAT >>> cheque to HMRC which is the difference of those two numbers. >>> >>> A modern computer system doesn't find this too difficult. Unless that is >>> some half baked government changes the VAT rate from 17.5% to 15% in the >>> run up to Christmas as they did last year. That was a disaster for shops >>> as shelf prices are all marked inclusive of VAT. UK VAT is expected to >>> go to 20% shortly to deal with the deficit. It will make mental >>> arithmetic a lot easier - I never learnt my 17.5x table. >>> >>> Exceptions exist for cross boarder trades in the EEC which allow not >>> charging VAT if the goods are for export to another country in the EEC. >>> This leads to a complex form of cross border trade called carousel fraud >>> which typically involves small high value objects like memory chips, >>> mobile phones and latterly carbon credits. >>> >>> http://news.bbc.co.uk/1/hi/business/5204422.stm >>> >>>> ...and IIRC, the Canuckistani VAT is paid by the buyer; a sales tax. >>> A pure sales tax paid only by the non-business end user would be a lot >>> simpler. Allowing businesses not to have to fight with badly paid VAT >>> advisers. I have had some amusing run-ins with them on reclaiming VAT >>> for a charity making disabled access improvements. >> >> There's nothing wrong or difficult about having businesses pay sales >> tax. We in California pay sales tax on anything we consume, like >> equipment and furniture and supplies, and pay no tax on parts or >> subassemblies that will go into sellable products. But it probably >> makes sense to exempt productive equipment, since that would encourage >> long-term productivity and job creation. >> >> If there's an opamp in stock and I pull it out to make a breadboard or >> a test fixture, I should in theory note the event and pay sales tax on >> it. And if I buy a bunch of parts for engineering, taxed, but some >> wind up in a shipped product, we should get a refund on the taxes. >> >> VAT sounds like a mess to me. Accountants and attorneys and >> bureaucrats are all useless, expensive overheads on society. >> > >Yup. And now they are talking about taxing services. Meaning what I cost >my clients would then go up by x percent, or the cost of doing business >in California would go up by x percent. Which will increase the exodus >because the guy 50 miles east of here in Nevada doesn't have that cost. >I sure hope that the 2/3rds rule will hold to avert such damage. Every >business or person leaving the state will cause the net tax from that to >drop to zero. Since we're increasingly a services economy, we should tax services and simultaneously reduce tax rates on stuff. John
From: Martin Brown on 14 May 2010 11:53 On 14/05/2010 16:25, John Larkin wrote: > On Fri, 14 May 2010 08:50:11 +0100, Martin Brown > <|||newspam|||@nezumi.demon.co.uk> wrote: > >> A pure sales tax paid only by the non-business end user would be a lot >> simpler. Allowing businesses not to have to fight with badly paid VAT >> advisers. I have had some amusing run-ins with them on reclaiming VAT >> for a charity making disabled access improvements. > > There's nothing wrong or difficult about having businesses pay sales > tax. We in California pay sales tax on anything we consume, like I see that as faintly odd. Taxing businesses for buying stuff to help run their business and new equipment doesn't really make any sense. > equipment and furniture and supplies, and pay no tax on parts or > subassemblies that will go into sellable products. But it probably > makes sense to exempt productive equipment, since that would encourage > long-term productivity and job creation. It does provide the odd interesting loophole. My supervisor at university tried a lawnmower as a company expense (ruled invalid). We tried company bicycles and that was accepted! > > If there's an opamp in stock and I pull it out to make a breadboard or > a test fixture, I should in theory note the event and pay sales tax on > it. And if I buy a bunch of parts for engineering, taxed, but some > wind up in a shipped product, we should get a refund on the taxes. It is different to what I am used to and just as messy to implement. If anything you have the same nightmare scenario as UK fast food places where the price you pay depends on whether you take away or eat in VAT=0 or 17.5 respectively. I presume that noone bothers in the US like buying stuff from another state to evade state sales taxes. > > VAT sounds like a mess to me. Accountants and attorneys and > bureaucrats are all useless, expensive overheads on society. It is relatively straightforward provided that you do not have too many different rates and/or wierd exemptions. Different to what you are used to - but I think an end user purchase/sales tax would be a lot cleaner. Regards, Martin Brown
From: Joerg on 14 May 2010 12:10
John Larkin wrote: > On Fri, 14 May 2010 08:31:48 -0700, Joerg <invalid(a)invalid.invalid> > wrote: > >> John Larkin wrote: >>> On Fri, 14 May 2010 08:50:11 +0100, Martin Brown >>> <|||newspam|||@nezumi.demon.co.uk> wrote: >>> >>>> On 14/05/2010 05:12, krw(a)att.bizzzzzzzzzzzz wrote: >>>>> On Thu, 13 May 2010 21:03:14 -0700 (PDT), dagmargoodboat(a)yahoo.com wrote: >>>>> >>>>>> On May 13, 10:21 pm, "k...(a)att.bizzzzzzzzzzzz" >>>>>> <k...(a)att.bizzzzzzzzzzzz> wrote: >>>>>>> On Thu, 13 May 2010 19:08:20 -0700, John Larkin >>>>>>> <jjlar...(a)highNOTlandTHIStechnologyPART.com> wrote: >>>>>>>>> VATs tend to be sales taxes, in reality. >>>>>>>> VAT is applied all up and down the production chain. So the only stage >>>>>>>> that can be selectively taxes is the last one, at point of sale. I >>>>>>>> prefer a true 100% visible point of sale sales tax. VAT is designed to >>>>>>>> hide the actual taxation level, at considerable cost of complexity. >>>>>>> That's the theory but in practice, AIUI, VATs are only collected at the end of >>>>>>> the pipe. >>>>>> No. They're charged and credited throughout the chain. Your thing >>>>>> gets taxed, then rebated and the next guy pays, then gets his rebate, >>>>>> etc. >>>>> So it's only collected at the end. >>>>> >>>>>> Maximum work for everyone. Maximum intrusion. Horrible. >>>>> A lot of work, sure, but money only changes hands at the end of the pipe. >>>> No. You have it wrong. Every stage in the pipeline *pays* VAT inclusive >>>> prices to their suppliers and totals up their input tax and then charges >>>> their customers including VAT and totals up their output tax. Then >>>> every month if large or three months if a small company you send a VAT >>>> cheque to HMRC which is the difference of those two numbers. >>>> >>>> A modern computer system doesn't find this too difficult. Unless that is >>>> some half baked government changes the VAT rate from 17.5% to 15% in the >>>> run up to Christmas as they did last year. That was a disaster for shops >>>> as shelf prices are all marked inclusive of VAT. UK VAT is expected to >>>> go to 20% shortly to deal with the deficit. It will make mental >>>> arithmetic a lot easier - I never learnt my 17.5x table. >>>> >>>> Exceptions exist for cross boarder trades in the EEC which allow not >>>> charging VAT if the goods are for export to another country in the EEC. >>>> This leads to a complex form of cross border trade called carousel fraud >>>> which typically involves small high value objects like memory chips, >>>> mobile phones and latterly carbon credits. >>>> >>>> http://news.bbc.co.uk/1/hi/business/5204422.stm >>>> >>>>> ...and IIRC, the Canuckistani VAT is paid by the buyer; a sales tax. >>>> A pure sales tax paid only by the non-business end user would be a lot >>>> simpler. Allowing businesses not to have to fight with badly paid VAT >>>> advisers. I have had some amusing run-ins with them on reclaiming VAT >>>> for a charity making disabled access improvements. >>> There's nothing wrong or difficult about having businesses pay sales >>> tax. We in California pay sales tax on anything we consume, like >>> equipment and furniture and supplies, and pay no tax on parts or >>> subassemblies that will go into sellable products. But it probably >>> makes sense to exempt productive equipment, since that would encourage >>> long-term productivity and job creation. >>> >>> If there's an opamp in stock and I pull it out to make a breadboard or >>> a test fixture, I should in theory note the event and pay sales tax on >>> it. And if I buy a bunch of parts for engineering, taxed, but some >>> wind up in a shipped product, we should get a refund on the taxes. >>> >>> VAT sounds like a mess to me. Accountants and attorneys and >>> bureaucrats are all useless, expensive overheads on society. >>> >> Yup. And now they are talking about taxing services. Meaning what I cost >> my clients would then go up by x percent, or the cost of doing business >> in California would go up by x percent. Which will increase the exodus >> because the guy 50 miles east of here in Nevada doesn't have that cost. >> I sure hope that the 2/3rds rule will hold to avert such damage. Every >> business or person leaving the state will cause the net tax from that to >> drop to zero. > > Since we're increasingly a services economy, we should tax services > and simultaneously reduce tax rates on stuff. > Well, if that happens and they also hit consultants and contractors with it I may finally have to move to the island to drop my cost to clients back to where it was. Luckily in my line of work it doesn't matter where I reside. Selling a home in CA, that's a whole 'nother matter right now :-( -- Regards, Joerg http://www.analogconsultants.com/ "gmail" domain blocked because of excessive spam. Use another domain or send PM. |