Why the Constitution Party opposes both the fair tax and the income tax

[Red Green]

A tax on general consumption and/or VAT means a lower MPC, while an income tax tends to increase the MPC.

I'm sorry, you'll have to define 'MPC' for me. I am unfamiliar with that acronym.

Since the American economy does not need more savings but more consumption I favor taxes that increase the MPC because they hurt the economy less then taxes that reduces the MPC.

Well, unless you're an economist, your assertion that the economy needs more consumption and less savings is an uneducated opinion. Furthermore, claiming that the economy should be regulated via taxes is something that someone who is for central planning would generally agree with. Free market advocates would look for a tax that has the least amount of influence on economic behavior, given that they would contend that the free market is a self-regulated system that will produce the optimal savings / consumption ratios will be determined by individual behavior within the market.

My favorite tax would be a small tax on holding money, to increase consumtion and reduce the amount of money saved for a long time.

Wow, you need to do some reading there fella. That is some nonsense.

 

[Klibet]

I'm sorry, you'll have to define 'MPC' for me. I am unfamiliar with that acronym.

Marginal propensity to consume.

Well, unless you're an economist, your assertion that the economy needs more consumption and less savings is an uneducated opinion. Furthermore, claiming that the economy should be regulated via taxes is something that someone who is for central planning would generally agree with. Free market advocates would look for a tax that has the least amount of influence on economic behavior, given that they would contend that the free market is a self-regulated system that will produce the optimal savings / consumption ratios will be determined by individual behavior within the market.

I took economy class when I was younger. The free market does not always self regulate perfectly. Because to have something to save someone else must spend so you get that income. So if everyone started saving more, savings would decrease since savings come from income. As consumption decreases businesses would realise they are overproducing and reduce production and even less would be saved as less people have incomes, the economy would fall and we have less savings and less consumption. That is the paradox of thrift. But if people saved less, savings can also increase as businesses would produce more to meet the increased demand and more people would have incomes so they can save in the first place.

Wow, you need to do some reading there fella. That is some nonsense.

Administrative difficulties make inflation the only tax on holding money that works.

 

[Keith and stuff]

Watch out. A VAT may increase by almost 200% overnight. That's what's happening in France right now.

Organizers of Sunday's protest say the EU-mandated rise of France's VAT to 20 percent as of January 1 - from the 7 percent reduced rate paid by equestrian centers today - will shut down a fifth of centers across France.

Some 6,000 jobs will be lost, they estimate, and 80,000 horses will have to be sent to slaughter.

"Riders, up in arms!" shouted protesters carrying signs reading "Sales tax at 20 percent - Death of Horses and Ponies".

http://www.reuters.com/article/2013/11/24/us-france-protest-idUSBRE9AN0DO20131124


And if you want to buy art in France, do it now because a disaster is coming!

High-profile trade figures in the French art world have warned the government that a proposed rise in VAT affecting works of art imported into France from outside the European Union will seriously undermine the country’s standing in the global art market.

A report compiled by Guillaume Cerutti, the chief executive of Sotheby’s in France, the Paris dealer Franck Prazan and Georges-Philippe Vallois, the president of the French galleries association, says that the planned increase—a hike from 7% to 10%, due to come into effect in January 2014—would “have disastrous consequences for the French art market in its entirety”.

In unusually candid terms, the report describes how French fairs such as Fiac (the Foire Internationale d’Art Contemporain), held in Paris every October, would lose out to rivals such as the Frieze Art Fair in London. The UK’s VAT rate of 5% for imported works already makes France a more expensive destination for dealers and collectors.

“An international American gallery that is weighing up participating in either Frieze or Fiac would be tempted to invite clients to its stand in London, rather than in Paris,” the report says. “A Swiss collector who owns a work by Nicolas de Staël may well favour London over Paris if he chooses to sell the piece.”

France would continue to lose ground in the global art market, warn the co-authors, risking further falls in its percentage share of international sales (in 2012, France trailed in fourth, on 5%, after China, the US and the UK). The proposed bill goes before the Conseil des Ministres (the French cabinet) this month.

http://www.theartnewspaper.com/articles/French-trade-warns-of-VAT-disaster/30243


And in an effort to hurt poor people, the socialist leaders of France are trying to increase the general VAT too. But don't worry, according to the socialist French Finance Minister of France, the VAT tax isn't connected to price of goods. It's hidden and he wants it to remain that way.

Rather than table the VAT increase, French Finance Minister Pierre Moscovici is asking the country’s retail chains to “not raise their prices” to account for the increased tax (Yahoo Finance).

M. Moscovici told RTL radio, “Nobody has to reflect this (VAT hike) in their prices. I think it’s important to show virtuous behavior, notably in the retail sector which along with the French people must display a civic spirit.” The retailers of France have not yet responded to this suggestion.

http://www.taxrates.com/blog/2013/11/18/will-france-go-through-with-vat-increase/



France urges retail chains not to pass on sales tax rise
Reuters
November 14, 2013 5:33 AM
http://finance.yahoo.com/news/france-urges-retail-chains-not-103323766.html

But he would ask retail chains - already struggling with smaller margins than some of their European peers - not to raise their prices.

"Nobody has to reflect this (VAT hike) in their prices," he told RTL radio. "I think it's important to show virtuous behaviour, notably in the retail sector which along with the French people must display a civic spirit."

High labour costs have squeezed margins for French retailers including Carrefour (PAR:CA), Leclerc and Casino (PAR:CO), stoking criticism from business leaders who say President Francois Hollande's tax increase will unfairly penalize them.

Ratings agency S&P echoed the criticism when it downgraded French debt to AA+ to AA last week, citing insufficient efforts to reduce public spending and implement structural reform.

The retailers were not immediately available for comment on Thursday.

The Socialist government has promised to stop raising taxes once the 2014 increases - which also include a new 75 percent top rate of income tax and higher corporate taxes - have taken effect.

Socialism means a VAT of over 20% and personal income taxes of 75% I don't think I'm a fan.

 

[Red Green]

I took economy classes when I was younger. The free market does not always self regulate perfectly.

I see, so taxes created by politicians and administered by bureaucrats are a more effective way to regulate the economy? I have to wonder what kind of economics class you took.

Because to have something to save someone else must spend so you get that income. So if everyone started saving more, savings would decrease since savings come from income.

Wow, that there is ignorance. You do realize the economy is not static? You do realize that there are different tax jurisdictions within the state you are living, within the country you are living and within the world in which we operate, right?

As consumption decreases businesses would realise they are overproducing and reduce production and even less would be saved as less people have incomes, the economy would fall and we have less savings and less consumption. That is the paradox of thrift. But if people saved less, savings can also increase as businesses would produce more to meet the increased demand and more people would have incomes so they can save in the first place.

The market seeks an equilibrium. Your assertions are the musings of a central planner. I honestly don't know where you got this stuff. It sounds like the last economics class you took was home economics in HS.

 

[Klibet]

I see, so taxes created by politicians and administered by bureaucrats are a more effective way to regulate the economy? I have to wonder what kind of economics class you took.

Depends on what laws they pass.

Wow, that there is ignorance. You do realize the economy is not static? You do realize that there are different tax jurisdictions within the state you are living, within the country you are living and within the world in which we operate, right?

What does that have with the fact that that one mans expenditure is one mans income. So that if one man spends less someone else will have less to spend and save. Don' t try to go off topic.

The market seeks an equilibrium. Your assertions are the musings of a central planner. I honestly don't know where you got this stuff. It sounds like the last economics class you took was home economics in HS.

You can not ignore demand in economics, if the demand for goods and services decreases less goods and services will be produced as a result. If demand increases then more will be produced if the economy has the capacity to produce more. The market may seek an equilibrium but it does not always reach it, only in a perfect world would it always reach an equilibrium. Do not try to go off topic.

 

[Red Green]

Depends on what laws they pass.

You have to f'ing shitting me! Are you sure you're on the right forum?

What does that have with the fact that that one mans expenditure is one mans income. So that if one man spends less someone else will have less to spend and save. Don' t try to go off topic.

That is such a simplistic examination of economics that it would need to be drawn out with crayons to be fitting. You're totally discounting that savings leads to capital which leads to an increase in the marginal productivity of labor, etc. I could go on, but you really need to crack some books before you think you understand economics, even on a very basic level.

You can not ignore demand in economics, if the demand for goods and services decreases less goods and services will be produced as a result. If demand increases then more will be produced if the economy has the capacity to produce more. The market may seek an equilibrium but it does not always reach it, only in a perfect world would it always reach an equilibrium. Do not try to go off topic.

That is microeconomics, not macroeconomics. There are far more factors to looking at a macro economic model than supply and demand, especially held static.

 

[Red Green]

Hey Keith, if VATs are so hidden, how come you know so much about the VAT in France?