Quote:
Originally posted by Kitsune
Some have proposed that the public be taxed only on the goods they buy. This sounds interesting and potentially like a good idea, but I don't understand enough to know the ups and downs.
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Ups: Pretty simple, and potentially anonymous.
Downs: Heavily regressive. Poor people spend almost all of their money, and would therefore be taxed a much higher percentage. Rich people, even most of the conspicuous consumers, spend a comparatively tiny percentage of their money, and would therefore pay a comparatively tiny tax percentage. If the government needed to raise the tax, it would be a catastrophic hit on the poor, and a minor annoyance to the wealthy.