[The One and Only...]

Originally Posted by AChimp

In most places in Canada, we pay TWO separate sales taxes, provincial and federal. All it serves to do is increase the price of goods and services (necessities are exempt from these sales tax, but that doesn't amount to much outside of real food) AND it raised the base price of items because merchants had to make up for the sales tax that they paid for stuff, and so on up and up the product chain.

Adding a sales tax isn't just "consumer/end-user sales"; it applies to every transaction between every middleman and every supplier. When their costs go up, their sale prices also go up, and it is the consumer who pays for it in the end... unless that consumer will be content with only buying milk and bread for the rest of his or her life.

Yet, at the same time, if the income tax was gone suppliers could afford to lower their prices, and middle men could afford to pay more for their goods.

In any case, this would put companies who devised ways to cut middle men at an economic advantage, which would spur competition and likely lower prices overall.

This article talks about making it "progressive" by offering rebates and exemptions, but how will that be organized? Give every poor person an ID card that they can flash at the till which will tell the cashier not to charge them tax? The merchant still had to pay the sales tax on that item, so now your businesses are losing money.

Yes, but then again the business owner did not have to pay income tax. Do you happen to be missing something here?

Redemptions and rebates? They will never be able to fully reimburse every poor person the full amount that they have paid annually in taxes. Get them to save receipts? Ha... you still need accountants to verify the sums, and accountants COST money. Give everyone a flat amount? Well, you'd be handing out extra money to some people and not giving enough to other people, and people like Vinth would just have another thing to whine about being unfair.

You know what else costs money? The people who do taxes.

Flat rebates would be fine enough, since they would benefit those on the lower income bracket more than those on the higher.

Oh, just to point something out: the government would likely not want the sales tax to be too high, because that might lower the amount of consumer spending. The more people spend, the more tax money is raked in.