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U.S. Readies $11B in Tariffs on E.U

nytimes.com

81–90 of 98 posts

Re: U.S. Readies $11B in Tariffs on E.U

#81

In 2016 the US imported $416B and exported $270B to the EU. Although $11B is a large number, it's a 2.6% tax on the total. More interestingly, is what they are taxing. Personally, I'd rather have tariffs than income tax. At least then I can choose what to buy.

Consumption taxes are regressive, income taxes are progressive. The poor are disproportionately impacted by tariffs and sales/consumption taxes. The administration is taking money out of the hands of Americans under a truly misguided idea of what a trade deficit is.

This is actually wrong and for reasons that surprised me when I found out and it does not require luxury taxation.

Many? Most? People earning (say) $500k+ dodge their income tax, legally and illegally. There's a whole industry of it. Yes let's clamp down on that as we've been trying to across the world for decades. Not likely to eradicate it by next year though, right?

So you tax consumption at a flat rate /in addition/ to income tax. You ensure the people earning less get a tax break or a transfer payment increase to cover the consumption flat tax and then some.

All those wealthy people are now paying that base rate on their consumption in a way that is basically unavoidable.

So for your progressive taxation, the initial bracket cannot be avoided. People in higher brackets still should pay more.

By using consumption to tax the initial bracket the poor get an increase in after tax income. The rich (on average) get a higher tax bill.

Yes it depends on the modelling and getting the implementation right as all tax regimes do. Yes it is progressive.

When you see consumption tax as necessarily regressive (as I did once) you are missing the most important thing about them which is they really aren't. They're the best way of getting a big tax revenue increase at the expense of those who cheat. I like that, myself.

Re: U.S. Readies $11B in Tariffs on E.U

#82
post #79

Earlier quoted context omitted.

I feel you are reinventing definitions. The “same tax” would be very literally giving up the same value. The only common definition of value in society is currency - that is literally its role, to serve as a common measure (and storage) of utility. It does not confer net utility in and of itself (goods and services do), and therefore this argument of marginality doesn’t apply to it. I understand that goods and servic…

"Regressive" is not a synonym for "flat" - a flat tax is neither progressive nor regressive. And these terms are purely descriptive, defined via their effect on the effective tax rates.

[deleted]

Re: U.S. Readies $11B in Tariffs on E.U

#83

Earlier quoted context omitted.

It isn’t, though, because of the marginal utility of money. Someone making $10k/yr sees much more value from an extra $10k than someone making $10M. For one it’s a lifeline and for one a rounding error. While a flat tax is fair in numbers it’s not fair in marginal value or utility. IMO that’s a much bigger deal. There are other macroeconomic advantages to giving the little guy the extra, though I don’t want to repeat…

I feel you are reinventing definitions. The “same tax” would be very literally giving up the same value. The only common definition of value in society is currency - that is literally its role, to serve as a common measure (and storage) of utility. It does not confer net utility in and of itself (goods and services do), and therefore this argument of marginality doesn’t apply to it. I understand that goods and servic…

The rich already pay different amounts than the poor for goods and services in pre-tax dollars. That's kind of the idea, IMO. If my average tax rate is 28% and a poor person pays an average 5% then the same $5 SF coffee costs me $6.94 and them $5.26.

The dictionary definition is quite clear: A progressive tax is a tax in which the average tax rate (taxes paid ÷ personal income) increases as the taxable amount increases. [Google]

A regressive tax is a tax applied uniformly, taking a larger percentage of income from low-income earners than from high-income earners. It is in opposition to a progressive tax, which takes a larger percentage from high-income earners. [Also Google]

As such, Medicare taxes are regressive because they are capped at some amount of earned income, whereas the ordinary income tax rate is progressive because your marginal rate increases as you earn more money.

You are correct that a flat tax is neither progressive nor regressive with respect to dollars, but it is regressive with respect to marginal utility of those dollars to the earner. "Fair" is a value judgement and colors the conversation.

Re: U.S. Readies $11B in Tariffs on E.U

#84
post #81

Earlier quoted context omitted.

Consumption taxes are regressive, income taxes are progressive. The poor are disproportionately impacted by tariffs and sales/consumption taxes. The administration is taking money out of the hands of Americans under a truly misguided idea of what a trade deficit is.

This is actually wrong and for reasons that surprised me when I found out and it does not require luxury taxation. Many? Most? People earning (say) $500k+ dodge their income tax, legally and illegally. There's a whole industry of it. Yes let's clamp down on that as we've been trying to across the world for decades. Not likely to eradicate it by next year though, right? So you tax consumption at a flat rate /in additi…

IMO if you're basing your tax model on people dodging half of it you've kind of missed the point. People willing to dodge taxes will dodge taxes one way or the other. Re: consumption tax, just buy stuff on Amazon, boom, taxes dodged. Or on eBay, receiving "gifts" from your seller.

The solution isn't to invent a whole new parallel tax system so the dodgers pay a little instead of what they owe, the solution is to get the tax money back from the dodgers. The unpaid taxes on the amount of wealth squirreled away offshore by the wealthy right now would pay off the entire US national debt.

Re: U.S. Readies $11B in Tariffs on E.U

#85
post #37

Earlier quoted context omitted.

Do you think the EU should be able to enforce a law on a global scale and completely ignore country jurisdiction like they attempt to do with GDPR?

The US has forever been ignoring jurisdiction boundaries just like that. Ever heard of FATCA? Banks anywhere in the world need to report US-resident account holders to the IRS.

Which is the reason, why you may have a very hard time to open a bank account abroad, when you're a US citizen.

Banks just don't want to deal with that shit, if they can avoid it.

Re: U.S. Readies $11B in Tariffs on E.U

#86

Earlier quoted context omitted.

I feel you are reinventing definitions. The “same tax” would be very literally giving up the same value. The only common definition of value in society is currency - that is literally its role, to serve as a common measure (and storage) of utility. It does not confer net utility in and of itself (goods and services do), and therefore this argument of marginality doesn’t apply to it. I understand that goods and servic…

The rich already pay different amounts than the poor for goods and services in pre-tax dollars. That's kind of the idea, IMO. If my average tax rate is 28% and a poor person pays an average 5% then the same $5 SF coffee costs me $6.94 and them $5.26. The dictionary definition is quite clear: A progressive tax is a tax in which the average tax rate (taxes paid ÷ personal income) increases as the taxable amount increas…

And labels of ‘progressive’ and ‘regressive’ aren’t value judgments? IMO they are subjective judgments much more so than calling a true flat tax “fair”. Equal value contribution is fair, after all.

The dictionary definitions you are quoting are in existence simply due to common use in modern times, but I am claiming they are nevertheless bad definitions that were engineered to color the discourse on this topic.

Re: U.S. Readies $11B in Tariffs on E.U

#87
post #81

Earlier quoted context omitted.

This is actually wrong and for reasons that surprised me when I found out and it does not require luxury taxation. Many? Most? People earning (say) $500k+ dodge their income tax, legally and illegally. There's a whole industry of it. Yes let's clamp down on that as we've been trying to across the world for decades. Not likely to eradicate it by next year though, right? So you tax consumption at a flat rate /in additi…

IMO if you're basing your tax model on people dodging half of it you've kind of missed the point. People willing to dodge taxes will dodge taxes one way or the other. Re: consumption tax, just buy stuff on Amazon, boom, taxes dodged. Or on eBay, receiving "gifts" from your seller. The solution isn't to invent a whole new parallel tax system so the dodgers pay a little instead of what they owe, the solution is to get…

“The unpaid taxes on the amount of wealth squirreled away offshore by the wealthy right now would pay off the entire US national debt.”

without a source i call BS on this.

us debt: 22 trillion. assuming 25% as median tax rate means that people in the US have more than 100 trillion USD stashed in offshore.

to put this in context, top 50 US companies have around 3 trillion USD in offshore.

Re: U.S. Readies $11B in Tariffs on E.U

#88

Earlier quoted context omitted.

I'm sure Russia will take advantage of any split in US/EURO alliance, but if you think it's Russia that is doing the splitting, then you haven't been paying attention. The split is entirely due to US inability to cooperate or maintain an agreement with other nations, and some of those nations are finally pushing back. The Russian word for this is недоговороспособный (not agreement capable).

[flagged]

Hey downvoters, I don't think there is doubt that Russia interfered. The only questions is with or without Trump's knowledge and / or approval. According to Mueller's report, without. But still, Russia supported Trump and it's not hard to see why: He is dividing the West.

https://www.wired.com/story/russian-facebook-ads-targeted-us...

Re: U.S. Readies $11B in Tariffs on E.U

#89
post #10

The irony of Boeing complaining about favorable treatment by the government is palpable.

Other countries are going to start ignoring FAA safety rulings now, so meaning that in exchange for a short term monetary gain a bunch of politicians and executives will probably cause significant long term costs - although the people who made those decisions and took those bribes won't have to pay for those consequences, they've already got there's :-/

How many time it has to happen until we learn it. Every time an industry is left unwatched crisis happens because there is always short term monetary gain for a bunch of executives. It was the same thing with SCC going blind about big banks before 2008. FAA - Boeing relationship is an example of SCC - BigBanks relationship before 2008.

Re: U.S. Readies $11B in Tariffs on E.U

#90

Earlier quoted context omitted.

What ridiculous laws do you mean? GDPR? Or monopoly abuse fines? Do you think US businesses should be able to run under US law in the EU, meaning they can do whatever they want to consumers, monopolizing markets by violating local laws, taking in huge profits, and then hardly paying corporate taxes (neither in EU nor US)? None of that has anything to do with these tariffs, btw.

Do you think the EU should be able to enforce a law on a global scale and completely ignore country jurisdiction like they attempt to do with GDPR?

Why not? The US does it all the time.
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