Tax codes may seem like an incredibly boring subject to almost everyone but you may be surprised to learn that within them rests the seeds of possibly one of the greatest benefits to society and the environment in recent history. The kicker is, it won't even end up costing you much more.
The potential benefit I speak of is known as the Fair Tax. It is a consumption tax placed on purchases of new goods, similar to a sales tax only as a much larger percentage, which replaces the more traditional income taxes. "In essence, income taxes penalize people for what they contribute to society (labor and capital), whereas consumption taxes penalize people for what they take out of society (new retail purchases)."(Miller, 310)
Under such a system system only purchases of new goods and services are subject to this consumption tax. So buying used goods and sharing skills and labor within the community are not taxed. Environmentally this would mean a huge leap forward as such a tax greatly favors reducing and reusing. For example it would be far cheaper to purchase a dresser at a yard sale or thrift store and repaint or otherwise redecorate it as opposed to purchasing a new one. In this scenario under a consumption tax you are paying a tax only on the paint, sandpaper and knobs (given an estimated cost of $12 for these items the tax would be $2.76) as compared to the tax on the whole dresser ($27.60 on an estimated dresser cost of $120). Businesses which deal with the maintenance, repair, and reuse of already existing products (seamstresses, upholsterers, auto mechanics) will see increased business and expansion, as keeping what you have working will be more cost effective than purchasing a new product.
The initial quality and longevity of products will increase as consumers will demand a long lasting, easily repaired product in exchange for the higher price they are paying up front. This consumer demand will cause a decrease in the amount of poor quality, short term products finding their way into landfills.
Going further, economist Robert Franks has suggested a progressive consumption tax in which the more one consumes in a given year, the higher the consumption tax percentage rises. A progressive consumption tax could also be placed on individual categories of products so that the consumer bears the true cost of the purchase as opposed to society picking up the additional costs. "For example, if a $1 pack of cigarettes imposes about $6 of additional costs on a country's nationalized health care system, to cover the expenses of caring for the increased number of lung cancer and emphysema cases, then the consumption tax on cigarettes should be 600 percent."(Miller, 312) Isn't it only fair that everyone should bear the full responsibility of their actions?
This change in tax law could revolutionize many facets of life in the United States. It solves some of the largest environmental issues associated with consumerism, cheap disposable products rapidly filling up landfills. It goes to work on a variety of societal issues from narcissistic consumerism which leaves people feeling unfulfilled, to government budget woes, and even the immigration dispute.
One of the biggest arguments is that illegal immigrants take advantage of government programs while the bill is being footed by U.S. taxpayers. Under a consumption tax, even immigrants pay taxes into the system, thereby helping to fund the programs they use.
With a progressive consumption tax in place the arguments that a national health care system would be far too expensive begin to loose much of their footing. Tourists, immigrants, and citizens, essentially all of the groups who would need medical care are paying into the system by purchasing new products. Going further, those most likely to end up in the hospital (tobacco users, alcoholics, motorcycle riders, etc.) would have already paid a higher consumption tax to cover the eventuality of their medical care.
Any way you look at it, the Fair Tax would be a giant step forward for the United States, a benefit to the country as a whole regardless of party affiliation. Yet like most great ideas it is being suppressed by politicking, misinformation, and fear, in favor of the known and established. This is one good plan that I hope gets the chance to show the change it could enact for the benefit of the masses.
Work Cited:
Miller, Geoffrey, PhD. Spent. Sex, Evolution, and Consumer Behavior. New York: Viking Penguin Group, 2009.
No comments:
Post a Comment