Tuesday, November 29, 2011
What about a "progressive consumption" tax?
Steven Pearlstein Sunday, in the Washington Post, revisited a suggestion that I think still deserves airing: a “progressive consumption tax”. He mentions Cornell University economist Robert Frank’s book “The Darwin Economy”, which I should look into; maybe it should be called “The Spencer Economy”, though.
Investment income would be taxed only when it is consumed. This is a “principled” kind of Buffet tax: maybe the rich pay lower rates than their secretaries, but once they live better, they pay.
Is that so different from a VAT, with vouchers for the poor? Or from special taxes on travelers (hotel and car rental taxes levied by most municipalities and states – after all, travelers don’t vote in their areas).
Here’s his link.