Jindal: Out, corporate & income tax. In, increased sales tax.

[pbrower2a]

VATs do interest me.  It is incredibly efficient compared to income tax.  Perhaps there is a way to keep it progressive, like if it was done in combination with a simple income tax. 

For example:

Income tax brackets would be up shifted 50k: 0% for first $50,000, 10% for 50,001-58,700, etc., etc.

Then, projected loss of revenue would be matched up with a projected equal gain in revenue for % VAT.

The rich still pay more taxes.  We would also make EBT purchases tax exempt

A VAT as a rule is a regressive tax because it falls on the ultimate consumer. Where a VAT is in use it comes with an elaborate and generous cradle-to-grave welfare state without which such a tax would lead to riots. If it comes with free education through grad school for anyone with the grades, generous unemployment benefits, and Medicare for All....  we would be Germany.

[pbrower2a]

Good way to promote further inequality.

I think you're right about the intent, but even giving him the benefit of the doubt, he's trying to get the poors to leave and the richers to come in. And that may happen a very little, but Republicans grossly overestimate the effect that tax codes have on people in the real world. If taxes were that important, there would be very few high earners in NY and CA and many in my home state, which has no income tax on earned income. Instead, you have the opposite. And you have a lot inequality based problems. But that's the South for you.

1. Louisiana pols have the idea that New Orleans thrives on its tourist industry, and that high sales taxes hit Chicago tourists more than they hit the poor.  Such is a common misconception about the sales taxes. In most places the customers are locals -- especially in a large metro area. Maybe ski and beach resorts fit that description, but that is a poor argument even for the city that is the biggest tourist attraction of all -- New York City.

2. Sales taxes as a rule disproportionately hit the poor -- especially if food is not exempt. But even without taxes on food sales taxes hit the poor for utilities (even if those are furnished by the landlord who can pass the cost onto renters), gasoline, clothing, and housewares -- let alone fast food meals and cr@ppy used cars that the rich do not buy.  This is an iron rule. Sure, the rich buy luxuries, but they aren't spending every last cent that they get to survive. The fellow paying cash for a new Mercedes almost as a rule is not paying as much a share of his income on automobile costs as the fellow who buys a succession of clunkers from tote-the-note rip-off places.

3. I don't see how Louisiana could be a favored destination for well-heeled retirees to live.  Housing costs are high in the only city with any semblance of a cosmopolitan culture. Miami has more to offer at that.  Winters are still decidedly winters, so the state doesn't attract the snowbirds.

4. The tax structure of most southern states shows the heritage of the plantation system. Self-contained plantations as a rule had no cash economy for those who worked there -- they got payment in kind and often the castoffs of the elites. The only time that anyone ever got cash was when  the planter got revenue from selling cotton, lumber, cattle, rice, tobacco, or some other cash crop. The plantation as a rule grew its own staple crops for local consumption, and about the only time when a planter spent money was when the family 'imported' some luxury goods (which could be taxed), more property (not taxed), or in the really-old days slaves. Of course the planters who dominated the plantations did not face an income tax.

But anyone outside the plantation did pay taxes on just about everything. Independent commerce and industry could never flourish. But who needed independent commerce or industry when King Cotton dominated the economy and made a great life for the planters, the only people who mattered in the Natural Order of Things? After all, economic elites have little use for an independent middle class whether shopkeepers or government employees. When one can pay such people as clergy in chickens and flour... get the idea?


      

[pbrower2a]

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If the rich buy luxuries doesn't that mean that they are contributing that much more to the public coffers? Also - how does income tax affect tourists? Sales tax means that everyone who purchases anything in Louisiana pays the tax. Instead of having the residents contribute 100 percent, now you have the tourists contributing a significant proportion - so you're effectively shifting the burden away from residents.

The point is that it is far easier for some plutocrat to buy a Mercedes-Benz than it is for someone working for $8 an hour to meet the payments for a 10-year-old car with 150K miles on it. That poor person also spends a far larger proportion of his pay on food, even if the food is rice and beans for the poor person and the rich person buys lobster. $8 an hour means that the cast-off television at Goodwill is more of a burden than some 65" screen TV is to someone making $1 million a year.

Oh, by the way -- Louisiana is one of the poorest states in America. Governor Jindal seems to have no concern that his policies would hurt the poor more. But poor people don't make fat contributions to political campaigns -- the ultimate luxury. 

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Maybe some people think that they can 'choose' between buying a bed and sleeping on the bare floor. Maybe some people can 'choose' between having a telephone and not having one. Maybe they can 'choose' between buying such items as dishwashing detergent, laundry soap and toothpaste and not doing so. Basic human needs are often taxable.