To the editor:
While the 2020 national election still remains on the horizon, a barrage of “fake news” will be accompanied by “fake” economic theories. Among them are free tuition for college education, free universal medical care, and other social justice programs that are not affordable.
In fact, this nation — to maintain its preeminence in a global economy — cannot afford not to do so. It would be better to describe the “cost” as an investment in a healthy, well-educated population.
A second economic fallacy is that sales tax is disproportionately a disadvantage to those with low incomes. In fact, items needed for survival are generally not taxed at all.
Furthermore, did you ever hear of the poor or middle class purchasing yachts or other such luxury items, if subject to a sales tax, would provide huge funds to the government? You can be sure that the wealthy do not advocate for them.
The income tax is only theoretically progressive. Many huge loopholes in the income tax law fill volumes. Nor are these tax-savings deductions used substantially as investments in our economy. Instead, much of the money is squirreled away, in secret bank accounts almost invisible in nations remote from American shores.
It’s time that Americans be aware of such schemes that are unfair as well as unwise.
Additionally, a sales tax captures income from underground earners where billions of dollars are lost annually. Similar to the sales tax is the VAT — the value-added tax — where taxes are imposed at the various stages of production. The VAT, a more complicated process of taxation — and likely presenting an inhibitor with regard to export trade due to higher costs of production — at least captures a good deal of taxes from those who make purchases at the wholesale level.
Many countries do not rely solely on income taxes with their multitude of tax evasions, but a mix of those described above. That possibility probably accounts for the provision of universal health care, free or subsidized tuition, and other free or low-cost services.
Many of these countries, though less wealthy than the United States, rank near or at the top of the happy nations list.
As a matter of fact, the United States is listed as only 19th on the list. Is it any wonder that Congress, which is responsible for writing the federal tax laws, has an approval rating of 18 percent, much below even the low rating of the president at 42 percent.
The American public deserves better from its elected officials.