UK Emergency Budget

[MOBIUS]

And you're training to be an actuary, Kuci, the shame, the shame...

[Hauldren Collider]

Ben sometimes says things that are correct, if only by accident. As they say, a stopped clock is right twice a day.

For instance Ben would surely agree that the earth has gravity. This does not make it wrong.

HOWEVER if Ben claiming something automatically made something wrong, that would be SO. ****ING. AWESOME.

For instance, we could get him to say that no one lives forever. BAM. People can live forever. How ****ing sweet is that?

[MOBIUS]

I bet you actually think that's clever...

The problem with you is that you're a pedantic and immature spoiled little **** with no imagination. Talking to you, I genuinely feel like I've gone back in time 5 years and am actually talking to Kuci...

[Kuciwalker]

The proportion is always the same. But the reason why the VAT is regressive is because the real impact of it provides benefits to the rich that the poor do not get -- the deferral of VAT payment granted by investments results in real-world supplemental income not afforded to poor people.

If VAT were paid prospectively - if the rich could not defer it - the net results would be precisely the same.

If you look at it in terms of the real world, the rich benefit more than the poor.

This is meaningless. If you are comparing income + CG tax to VAT that produces the same revenue, then rich people who save a large proportion of their income will be relatively better off than rich or poor people who don't under the new regime - that doesn't mean VAT is regressive, just that income + CG is progressive and VAT is flat. You are, however, capturing an enormously destructive boundary to get your progressivity.

[Asher]

I'm simply making the unavoidable point that in the "best case", the VAT will be equally burdened by both rich and poor people. This is when the rich and poor each spend the exact same proportion of their income on VAT-applicable products.

In the "worst case", the VAT is a burden more on poor people than rich. In part due to the fact that rich people can defer the payments and invest their money.

The burdens are not equal.

[Kuciwalker]

Two propositions for BFB to consider:

1) The bottom decile of British citizens by income is in something like the top quartile of all humans by material consumption, right?

2) The idea that the level of material consumption you are entitled to is based on where you were born is nearly as pernicious as the idea that it's based on who your parents were.

I'm simply making the unavoidable point that in the "best case", the VAT will be equally burdened by both rich and poor people. This is when the rich and poor each spend the exact same proportion of their income on VAT-applicable products.

Does the British VAT, or the VAT you're talking about, contain substantial exceptions? Are those exceptions [e.g. food is a plausible one] really consumed in greater proportion by the wealthy? If the VAT does contain exceptions, then in the best case it actually can be progressive.

[Ben Kenobi]

Another proposal, besides exemptation for food, is VAT reimbursement as they do here.

If you don't make enough to reach the lowest bracket, you get money back.

[notyoueither]

Another proposal, besides exemptation for food, is VAT reimbursement as they do here.

If you don't make enough to reach the lowest bracket, you get money back.

Many of the poorest of the poor pay GST (VAT) on their food as prepared food is taxed and not many of the poorest have equipped kitchens nor do they do the planning to eat groceries that are not taxed.

They also tend not to file taxes so they do not get GST rebates.

[Hauldren Collider]

Wait, are you saying that because they are too stupid to file their tax returns, it is unfair?

[notyoueither]

Many of them do not have steady jobs and some of them do not have addresses.

Filing taxes is not something way up the priority list of people scrounging empties to buy a burger.

[Ben Kenobi]

Many of the poorest of the poor pay GST (VAT) on their food as prepared food is taxed and not many of the poorest have equipped kitchens nor do they do the planning to eat groceries that are not taxed.

So because people make bad choices that makes the VAT flawed?

They also tend not to file taxes so they do not get GST rebates.

Again, not a flaw of the policy.

[Hauldren Collider]

Uhh, homeless people are a separate issue entirely. We shouldn't design the tax system around them.

[C0ckney]

kuci, there are exemptions for food, books, medicines and children's clothes (IIRC and this isn't an exhaustive list). i think water and sewerage services are also exempt.

i prefer VAT to other forms of taxation, because it reduces consumption, and i think that we (as a society) ought to consume less. whether this is good for the economy on the other hand...

[Hauldren Collider]

i prefer VAT to other forms of taxation, because it reduces consumption

This doesn't make sense. All taxation reduces consumption. And reducing consumption reduces production. You're saying that we shouldn't do as much stuff.

[C0ckney]

pretty much