In the modern era, however, direct taxes have mutated into a kind of hybrid tax where the government continues to impose the statutory liability for paying the tax on the individual, but he is not actually the person who remits the money to the government. Indirect taxes generally are collected and remitted to the government by intermediaries (usually businesses) on whom the government also imposes the statutory liability for paying the tax. An indirect tax-such as a retail sales tax (RST), a value added tax (VAT) or a business transfer tax (BTT)-is a tax imposed on business activities (e.g., value added during a particular stage of production) and commercial and financial transactions (e.g., retail sales), rather than on individuals themselves. Familiar examples are personal income taxes, the FICA wage tax imposed on workers to finance Social Security and Medicare and taxes on personal and real property. A direct tax, generally speaking, is one imposed directly on individuals’ wealth and paid directly to the government by the persons on whom the tax is imposed. This week, I refute the case against indirect taxes made primarily by well intentioned but misguided supporters of free markets and limited government, who believe them to be more efficient revenue engines that anesthetize the pain of taxation, disguise who bears the burden of taxation, and thereby lead to bigger government.įirst, a reprise on the distinction between direct and indirect taxes. The last few weeks, I have made the case against direct taxes-unfit for a free and prosperous people-largely because they create the perfect instrument of social engineering, economic redistribution and oppression.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |