Quick. Simple. Easy.
As for the receipt printed off, it looks like this:
Sticker price: $100
23% FED: $23
3% STATE: $3
1.5% CITY: $1.50
Quick. Simple. Easy. and WRONG!
You charged the customer $23 in federal sales taxes for a $72.50 item when you should have charged them $21.65 (unless you are trying to tell us the feds are going to tax state and local sales taxes). As I was trying to explain, you can't add individual tax inclusive sales tax rates. Every tax rate you add or change affects the "gross payment" thereby changing the amount of tax the different rates collect.
Example. A $100 dollar item bought in Austin, Texas:
Austin, Texas Item Cost $100.00 Federal 23.00% 29.87% $29.87 21.63% State 5.88% 6.25% $6.25 4.53% City 1.96% 2.00% $2.00 1.45% Total 30.84% 38.12% $138.12 27.60%
Drive 1 mile south to Pflugerville, Texas (yes, that's a real city):
Pflugerville, Texas Item Cost $100.00 Federal 23.00% 29.87% $29.87 21.70% State 5.88% 6.25% $6.25 4.54% City 1.48% 1.50% $1.50 1.09% Total 30.36% 37.62% $137.62 27.34%
Notice how the real inclusive rates have to change when you modify the city rate? When you change that rate you change the "gross payment" and your 23% inclusive federal rate is now collecting 23% of a different amount than the other city. Also notice how easy it is to add the tax exclusive sales tax rates. It's the natural way to express the additive sales tax.
Again, using the tax inclusive rate for sales taxes is not a matter of preference, it's flat out wrong. Just as it would be wrong to use exclusive rates with an income tax (similar things would happen).
Y'all can be reasonable, realize the error, and make a change; or continue to hang on and go down with the "tax inclusive" ship. I really don't know why y'all are so insistent on the tax inclusive rate anyway.
I know. I'm the one who pointed that out to you once upon a time, if you'll recall. Of course, that's only true when the taxes do not tax each other. Likewise, tax-exclusive rates can be added, unless the taxes tax each other.
I really don't know why y'all are so insistent on the tax inclusive rate anyway.
Of course you know, you just rpetend not to. They're proposed as tax-inclusive so that they can be reasonably compared to the taxes they're principally replacing (income and payroll taxes), which are expressed as tax-inclusive.
You've made it quite clear that you don't agree with that, but nevertheless, it's yet another lie/distortion from you to claim that you don't understand why it is used.
"Notice how the real inclusive rates have to change when you modify the city rate? When you change that rate you change the "gross payment" and your 23% inclusive federal rate is now collecting 23% of a different amount than the other city. Also notice how easy it is to add the tax exclusive sales tax rates. It's the natural way to express the additive sales tax.
Again, using the tax inclusive rate for sales taxes is not a matter of preference, it's flat out wrong. Just as it would be wrong to use exclusive rates with an income tax (similar things would happen).
Y'all can be reasonable, realize the error, and make a change; or continue to hang on and go down with the "tax inclusive" ship. I really don't know why y'all are so insistent on the tax inclusive rate anyway."
-- Like I told you, the $100 number is hypothetical. The retailer simply raises prices t owhatever amount he feels he needs to cover his prices. It's taxing HIS sales, so the $72.50 number is irrelevant. This is if you look at it as a "single-layer VAT."
If you want to dig deeper, you'll see that what happened here is that state and local taxes taxed FEDTAX.
If the State and local authorities did not want to "tax taxes", then they would simply deduct "other taxes paid" before applying theirs, it can all be done on the retaier side. Again, all the buyer would see is the final price, and they would be told how much of it actually went to taxes.
By the way I see your tactic every time the FairTax comes up: Turn the dabate away from one on fundamentals to one based on abstract mathematics. I fall it for myself.
From now on I won't respond to your stupid inclusive-exclusive arguments. Ancient_geezer won't either. When you try and propagandize a new FReeper, we'll email them, clear it up, prevent the dabate from being poisoned.
But hey, let's not get hung up on this unimportant math stuff.
To say it's a fair tax , and that everyone pays the same rate is another of the fairtax or national sales tax obvious lies.....look at the chart, you be the judge.
| State | State Rate | Range of Local Rates | 23% |
| Alabama | 4.000% | 1% - 7% | 23% |
| Alaska | 0.000% | 0% - 7% | 23% |
|
Arizona |
5.000% | .25% - 3.8% | 23% |
| Arkansas | 4.625% | .5% - 4.00% | 23% |
| California | 6.000% | 1.25% - 2.5% | 23% |
| Colorado | 3.000% | .25% - 7.00% | 23% |
| Connecticut | 6.000% | 0% | 23% |
| Delaware | 0.000% | 0% | 23% |
| District of Columbia | 5.750% | 0% | 23% |
| Florida | 6.000% | .5% - 1.5% | 23% |
| Georgia | 4.000% | 1% - 3% | 23% |
| Hawaii | 4.000% | 0% | 23% |
| Idaho | 5.000% | 1% - 3% | 23% |
| Illinois | 6.250% | .25% - 2.75% | 23% |
| Indiana | 5.000% | 0% | 23% |
| Iowa | 5.000% | 0% - 2% | 23% |
| Kansas | 4.900% | .25% - 3.00% | 23% |
| Kentucky | 6.000% | 0% | 23% |
| Louisiana | 4.000% | .3% - 6.75% | 23% |
| Maine | 5.500% | 0% | 23% |
| Maryland | 5.000% | 0% | 23% |
| Massachusetts | 5.000% | 0% | 23% |
| Michigan | 6.000% | 0% | 23% |
| Minnesota | 6.500% | .5% - 1% | 23% |
| Mississippi | 7.000% | 0% - .25% | 23% |
| Missouri | 4.225% | .5% - 4% | 23% |
| Montana | 0.000% | 0% | 23% |
| Nebraska | 5.00% | 1% - 1.5% | 23% |
| Nevada | 4.250% | 2.25% - 3% | 23% |
| New Hampshire | 0.000% | 0% | 23% |
| New Jersey | 6.000% | 0% | 23% |
| New Mexico | 5.000% | .125% - 2.438% | 23% |
| New York | 4.000% | 2% - 4.5% | 23% |
| North Carolina | 4.000% | 2% - 2.5% | 23% |
| North Dakota | 5.000% | 1% - 2% | 23% |
| Ohio | 5.000% | .5% - 2% | 23% |
| Oklahoma | 4.500% | .2% - 6.25% | 23% |
| Oregon | 0.000% | 0% | 23% |
| Pennsylvania | 6.000% | 0% - 1% | 23% |
| Rhode Island | 7.000% | 0% | 23% |
| South Carolina | 5.000% | 1% - 2% | 23% |
| South Dakota | 4.000% | 1% - 2% | 23% |
| Tennessee | 6.000% (10) | 1% - 2.75% | 23% |
| Texas | 6.250% | .5% - 2% | 23% |
| Utah | 4.750% | 1% - 3% | 23% |
| Vermont | 5.000% | 0% - 1% | 23% |
| Virginia | 3.500% | 1% | 23% |
| Washington | 6.500% | .5% - 2.1% | 23% |
| West Virginia | 6.000% | 0% | 23% |
| Wisconsin | 5.000% | .1% - 1.0% | 23% |
| Wyoming | 4.000% | 1% - 2% | 23% |
I'm not going to pretend to know all of the complexities of all the states sales taxes but as anyone can see, due to local taxes the "23%" rate can vary not only from state to state but from location to location within the same state.
As an example, I know people who live in Washington state and go shopping in Oregon, because as you see by the rate(s) Washington's rate is maximum 8.6%--Oregon is 0%
Our $100.00 dollar item in Oregon would have a "gross payment" of $ 129.87 ( it's still exorbitant) BUT, due to state taxes and the federal tax on tax, the same $ 100.00 item in Washington would have a "gross payment" of: $ 141.04 at the maximum state/local rate ($ 32.43 of which is federal sales tax)--another part of Washington or the next town for that matter could have a "gross payment" of $ 138.31 on the same $100.00 item ($ 31.81 of which is federal sales tax)---and, both, actually all of those, according to the sales tax folks, is considered to be a "23%" tax on the same item using the same base price, ... .
The citizens of Washington, at their maximum rate, would be paying 2.5% higher federal fairtaxes than their neighbors to the south in Oregon....
Even though the dollar amount of federal tax in Washington is more than Oregon, the sales tax folks will still tell you it's a 23% rate...an obvious fraud.
Since the citizens of Washinton ,for example, would be paying a larger dollar amount than Oregon, they'll really be getting screwed with their monthly, one size fits all, 23% of the predetermined poverty rate rebate from the central government....