This chapter discusses some of the ways in which distributional tables can be improved. The key points in this chapter are:
- The actual incidence of a tax may have little to do with the legal specification of its incidence. Official distributional tables recognize this fact in >many contexts, but not in all of them.
- In the long run, a large part of the burden of capital taxes is likely to be shifted to workers through a reduction in wages. Analyses that fail to recognize this shift can be misleading, suggesting that higher income groups bear an unrealistically large share of the long-run burden of such taxes.
I guess you missed this part on page 103:
Not at all for that is what can happen with a tax that burdens industry too much. Business tends to go belly up for lack of ability to make a profit if it can't compete it lays off workers exchanging them for lower paid new hires or worse collapses into bankruptcy when everyone looses.
Has happened to me, can happen again. You go on and get another job, and build your wage/salary up again or start your own business and see if you can do better.
Thomas Hobbes, Leviathan it is fairer to tax people on what they extract from the economy, as roughly measured by their consumption, than to tax them on what they produce for the economy, as roughly measured by their income.
They who would give up an essential liberty for temporary security, deserve neither liberty or security.
Benjamin Franklin.
The fundament issue is not how much but killing the income tax is the dominant basis for me:
Patrick Henry, Virginia Ratifying Convention June 12, 1788:
- "the oppression arising from taxation, is not from the amount but, from the mode
| "As a matter of fact, what the income tax does — and this is the debate that I think we always try to get into in order to let you and him fight, see — and the people of this country are led down a path where the actual control of their resources, which in the end is the control over their will, is handed off to the government." . . . "The government then manipulates that will in order to destroy the freedom of our electoral system through the income tax structure, and we call the resulting slavery a free system." "In point of fact, it is not as the founders understood, and the only way to restore real freedom is to give people back control over the income that they earn so that they won‘t, at the voting booth and in other phony issues, be subject to that manipulation." |