The Biden Presidency

[SezMe]

Perhaps. But then, you might just be shifting the tax cheating from "not paying income tax" to "not paying sales tax". (E.g. more private sales where the retailer doesn't charge the required taxes.)

Maybe, but the incentives are in the right direction. A person preparing his/her own taxes has a lot of incentive to cheat. However a retail outlet has no incentive to diminish sales taxes for any buyer - in fact, they have a significant incentive NOT to.

The problem with a national sales tax is that it is quite regressive. I suppose there are ways to mitigate that but it becomes complicated.

There are state sales taxes on almost all items except necessities like food. But there are no sales taxes on the buying and selling of stocks and bonds. I think a small tax (a quarter of a cent per 1000 shares?) would be progressive and would have other benefits for the individual investor. I'm sure it doesn't exist because damn near every lobbyist and congresscritter would be hit by it so it is DOA.

 

[Aridas]

The article says they are attempting to contact the companies. I see no reason to assume they hack then notify as opposed to notify then hack.

Likely, the actual order of things is more like 1) try to contact and inform about issue and if no action was taken in a reasonable amount of time, 2) do the notably more work-intensive hack to remove the immediate problem and then attempt to inform about what they did.

 

[Pixel42]

Mitch McConnell says “What we are confronted with here is a totally left-wing administration trying to transform America into something no one voted for last year.”

I suspect more Americans voted for what Biden is doing than ever voted for what previous totally right-wing administrations actually did.

 

[rdaneel]

Here's something a little interesting.

FBI hacks vulnerable US computers to fix malicious malware

US justice department says bureau hacked devices to remove malware from insecure software

I think the FBI should inform the company before they hack.Not comfortable with them just doing it wihtout any notification.
The possibilty for abuses are endless.

The article says they are attempting to contact the companies. I see no reason to assume they hack then notify as opposed to notify then hack.

Likely, the actual order of things is more like 1) try to contact and inform about issue and if no action was taken in a reasonable amount of time, 2) do the notably more work-intensive hack to remove the immediate problem and then attempt to inform about what they did.

This topic should really be in it's own thread. As far as I can tell, it has nothing to do with Biden's Presidency.

 

[Segnosaur]

Perhaps. But then, you might just be shifting the tax cheating from "not paying income tax" to "not paying sales tax". (E.g. more private sales where the retailer doesn't charge the required taxes.)

Maybe, but the incentives are in the right direction. A person preparing his/her own taxes has a lot of incentive to cheat. However a retail outlet has no incentive to diminish sales taxes for any buyer - in fact, they have a significant incentive NOT to.

Actually I think there's plenty of incentive. A retailer that says "Buy from me and I won't charge the sales tax" will probably make more sales than his competitor that always charges the proper tax rate.

There are state sales taxes on almost all items except necessities like food. But there are no sales taxes on the buying and selling of stocks and bonds. I think a small tax (a quarter of a cent per 1000 shares?) would be progressive and would have other benefits for the individual investor.

Something like that MIGHT work, although you might want to make it a percentage of the total value of the stock purchase/sale rather than number of shares; otherwise, companies will have an incentive to keep their stock prices high. (I.e. if you charge by the share, buying 1 share at $1000 per share will be cheaper than buying 10 shares at $100).

 

[TurkeysGhost]

Tensions rise within Biden administration as migrant kids crowd shelters

Rice, in particular, has pressed HHS staffers on what she sees as an unacceptably slow pace of releases of children to sponsors, the three officials said. While the number of children in HHS custody has grown by more than 65% between the end of March and mid-April, reaching more than 19,000, the number released from shelters has stayed around 300 per day, according to a Reuters analysis of government data.

https://www.reuters.com/article/usa-immigration-children/insight-tensions-rise-within-biden-administration-as-migrant-kids-crowd-shelters-idUSL1N2M607X

 

[Bob001]

.....
The problem with a national sales tax is that it is quite regressive. I suppose there are ways to mitigate that but it becomes complicated.

There are state sales taxes on almost all items except necessities like food. But there are no sales taxes on the buying and selling of stocks and bonds. I think a small tax (a quarter of a cent per 1000 shares?) would be progressive and would have other benefits for the individual investor. I'm sure it doesn't exist because damn near every lobbyist and congresscritter would be hit by it so it is DOA.

Most of Europe has a national VAT, a value added tax, which is similar to a sales tax on each stage of production and delivery, and it seems to work pretty well. To make it more progressive, taxpayers could get a tax credit or deduction for it on their income taxes up to a certain income level.

Bernie Sanders has proposed a transaction tax on stock and bond sales.

Under the measure, any stocks traded would be taxed at a rate of 0.5%, bonds at 0.1% and derivatives at 0.005%. So selling $1,000 of stock would incur a tax of $5. Such a tax could conservatively raise tens of billions of dollars per year, according to the Congressional Budget Office, which estimated the potential revenue at $776 billion over a decade. A 2017 study by the University of Massachusetts concluded a so-called financial transactions tax could yield a far bigger bounty -- $2.4 trillion over 10 years.

https://www.cbsnews.com/news/bernie-sanders-taxing-wall-street-trades-will-raise-2-trillion/

 

[Bob001]

Actually I think there's plenty of incentive. A retailer that says "Buy from me and I won't charge the sales tax" will probably make more sales than his competitor that always charges the proper tax rate.
....

What retailer would try that, unless he's taking cash under the table? The sales tax is on their total sales, which are well-documented and easy for authorities to determine. People can go to jail for not paying the sales tax they owe.

I note that one of the factors in Amazon's success is that until relatively recently, they and other online retailers didn't collect state and local sales taxes. That gave them a substantial price advantage.

 

[Horatius]

What retailer would try that, unless he's taking cash under the table? The sales tax is on their total sales, which are well-documented and easy for authorities to determine. People can go to jail for not paying the sales tax they owe.

Yeah, this. "No sales tax!" sales are pretty common around here, but what they're really doing is just taking the sales tax out of their regular price. So if they normally add the tax, for something that costs X, you'd pay 1.15X. Now, they just tell the government that the cost was Y, such that 1.15Y=X. So you're still paying tax, but it's just a smaller amount that they pass off as if they're screwing the government.

But in reality it's no different than if they'd just advertised the sale price of Y.

 

[Dr. Keith]

Most of Europe has a national VAT, a value added tax, which is similar to a sales tax on each stage of production and delivery, and it seems to work pretty well. To make it more progressive, taxpayers could get a tax credit or deduction for it on their income taxes up to a certain income level.

True, but it points out two issues:

1. It would be easier to fix our current income tax system than it would be to create an entirely new system, whether it copied state sales tax or VAT; and
2. VAT still depends on balancing at the income tax level, so we can't save money or complexity by shedding the income tax system.

Bernie Sanders has proposed a transaction tax on stock and bond sales.

https://www.cbsnews.com/news/bernie-sanders-taxing-wall-street-trades-will-raise-2-trillion/

That would be a bit easier to set up since those markets are already heavily regulated and run through relatively closed systems.

-------------------------

Side note: Isn't this off topic until Biden actually suggests something other than minor fiddling with our current tax system.

 

[The Great Zaganza]

Biden can just institute a Land Value Tax via Executive Order, right?

 

[Segnosaur]

Actually I think there's plenty of incentive. A retailer that says "Buy from me and I won't charge the sales tax" will probably make more sales than his competitor that always charges the proper tax rate.

What retailer would try that, unless he's taking cash under the table?

That's kind of what I was suggesting.

Granted, some companies selling big-ticket items might not be able to hide the taxes, but smaller/private retailers might be able to, either by outright "we're not charging tax, hoping we don't get audited", or by being creative. (Someone earlier suggested under-charging for a product, then charging extra for things like support, which might not fall under the sales tax.)

The sales tax is on their total sales, which are well-documented and easy for authorities to determine. People can go to jail for not paying the sales tax they owe.

Being 'well documented' provides a paper trail if the government investigates. But, there's no guarantee that they will bother to do so.

After all, there are also paper trails for employment income, and legal penalties for people who don't pay the required payroll taxes, yet the earlier article suggested there are potentially billions of dollars of taxes that get missed.

 

[acbytesla]

Most of Europe has a national VAT, a value added tax, which is similar to a sales tax on each stage of production and delivery, and it seems to work pretty well. To make it more progressive, taxpayers could get a tax credit or deduction for it on their income taxes up to a certain income level.

Bernie Sanders has proposed a transaction tax on stock and bond sales.

https://www.cbsnews.com/news/bernie-sanders-taxing-wall-street-trades-will-raise-2-trillion/

Who does the math? My math skills aren't what they use to be, but .01 percent would mean that selling $1000 shares of stock would incur a $1.00 tax not $5.00.

 

[Bob001]

Who does the math? My math skills aren't what they use to be, but .01 percent would mean that selling $1000 shares of stock would incur a $1.00 tax not $5.00.

From the link:

Under the measure, any stocks traded would be taxed at a rate of 0.5%, bonds at 0.1% and derivatives at 0.005%. So selling $1,000 of stock would incur a tax of $5.

And wouldn't .01 percent (one one-hundredth of one percent) of $1000 be ten cents?

 

[Segnosaur]

Most of Europe has a national VAT, a value added tax, which is similar to a sales tax on each stage of production and delivery, and it seems to work pretty well.

Canada used to have a series of Value-added taxes, but a few decades ago we scrapped that in favor of the 'Goods and Services Tax', which would apply to both products and services at the point of sale.

(Supposedly the argument was that it would both simplify the tax system, and also increase tax revenue as part of our economy was shifting away from manufacturing into services.)

 

[Bob001]

....
But in reality it's no different than if they'd just advertised the sale price of Y.

I've seen that a lot on things like theater tickets. The posted price might be $25, with fine print saying something like "$23.59 plus sales tax $1.41." As long as the state gets paid, the seller's price structure doesn't matter.

 

[Dr. Keith]

Canada used to have a series of Value-added taxes, but a few decades ago we scrapped that in favor of the 'Goods and Services Tax', which would apply to both products and services at the point of sale.

(Supposedly the argument was that it would both simplify the tax system, and also increase tax revenue as part of our economy was shifting away from manufacturing into services.)

As someone who has supported themselves for decades on the sale of services I vehemently oppose a tax on services because it would increase my paperwork if I ever go back to private practice.

 

[acbytesla]

From the link:


And wouldn't .01 percent (one one-hundredth of one percent) of $1000 be ten cents?

Never mind, I'm an idiot.

I never thought I had dyslexia but maybe?

And you're right

 

[Bob001]

As someone who has supported themselves for decades on the sale of services I vehemently oppose a tax on services because it would increase my paperwork if I ever go back to private practice.

Would it have to? You already know how many hours you bill. If the tax was X%, you would pay X% of your hours as tax, and might have to adjust your hourly rate upward. You wouldn't necessarily need to have a separate line item for sales tax on every invoice.

 

[dirtywick]

One thing I think Biden is doing very well is pushing a very aggressive agenda. It’s rare to see this in a first term, but I think it’s wise. There’s a very distinct possibility he can poll well and do a lot of popular things and still lose next term due to the EC and inconsistent polling is. Better to be aggressive and let the chips fall