Why not a national sales tax instead?

[Pandora]

Wouldn't that be a huge disincentive for buying new houses? What do you think would happen to the building industry if such a tax were passed?

Imagine if an existing house cost tens of thousands of dollars less than a newly built one. Who would build houses? How would they sell them at a profit?

Yes, it probably would. But With the housing bubble I think more homes have been constructed than people can afford to buy. And wouldn't it be better for the environment not to keep cutting down more trees to build more houses when there are tons of perfectly good houses out there to buy? Also couldn't construction workers make a lot of money remodeling existing houses to suit new families. Aren't we running out of space and land? It seems to me it would fix more problems than it would create. There would still be new homes built but by the really rich who can afford it or by people not worried about the tax. I would think a tax of that size would be done in payments, I think the same goes for new cars.


Also, wouldn't the price of new homes go down substantially? There would be no more taxes for your employees payroll for the builders to build or any of the other taxes it takes today to build a house. I think that would bring the price of new home construction.

 

[pocketfullofshells]

Yes, it probably would. But With the housing bubble I think more homes have been constructed than people can afford to buy. And wouldn't it be better for the environment not to keep cutting down more trees to build more houses when there are tons of perfectly good houses out there to buy? Also couldn't construction workers make a lot of money remodeling existing houses to suit new families. Aren't we running out of space and land? It seems to me it would fix more problems than it would create. There would still be new homes built but by the really rich who can afford it or by people not worried about the tax. I would think a tax of that size would be done in payments, I think the same goes for new cars.


Also, wouldn't the price of new homes go down substantially? There would be no more taxes for your employees payroll for the builders to build or any of the other taxes it takes today to build a house. I think that would bring the price of new home construction.

so now we should have a tax system that says don't buy a new house..thats only for the rich..the rest of you buy a old one.? I am sure that will sell to the public well...and of course would be a killer on jobs.

 

[Pandora]

so now we should have a tax system that says don't buy a new house..thats only for the rich..the rest of you buy a old one.? I am sure that will sell to the public well...and of course would be a killer on jobs.

I don't think it would say that. I think the prices of houses would come down and that would somewhat counter the cost of the tax and the tax would be over the 30 year loan and that is only if you need a brand new house

pre owned houses would have no tax.

It would slow down new construction but with that housing bubble we have way too many pre built houses empty so in the short run it would help fill them at a reasonable cost. And though new construction would slow down it doesn't mean all construction would slow down, the need for remodeling houses would rise.

I am just putting ideas out there, I am not saying they are all perfect or even viable. None of our ideas are going to manifest into anything anyway but it's a fun conversation.

I would love a world where housing and new cars were not taxed but we have to create revenue some how right? and who better to soak than the rich... who would be buying the bulk of new houses and cars. at least this way they are paying the tax by choice. We would all be paying taxes by choice based on what things we think we got to have.

 

[Gipper]

Wouldn't that be a huge disincentive for buying new houses? What do you think would happen to the building industry if such a tax were passed?

Imagine if an existing house cost tens of thousands of dollars less than a newly built one. Who would build houses? How would they sell them at a profit?

Probably, but so what. The mortgage deduction is at least partly responsible for the housing bubble.

There is very little new construction of homes going on now thanks to liberalism. In fact, there is WAY TOO MANY EMPTY homes throughout the nation.

I find it surprising the libs here WANT new home construction. Many liberal areas of the nation do everything they can to PREVENT new home construction. Why the contradiction?

 

[Pandora]

Probably, but so what. The mortgage deduction is at least partly responsible for the housing bubble.

There is very little new construction of homes going on now thanks to liberalism. In fact, there is WAY TOO MANY EMPTY homes throughout the nation.

I find it surprising the libs here WANT new home construction. Many liberal areas of the nation do everything they can to PREVENT new home construction. Why the contradiction?

There are way too many empty houses right now, practically brand new if not brand new. Honestly we really don't need new construction with all the houses that need owners right now.

Gipper, do you think a single sales tax replacing all the other taxes like this could work?

 

[Gipper]

There are way too many empty houses right now, practically brand new if not brand new. Honestly we really don't need new construction with all the houses that need owners right now.

Gipper, do you think a single sales tax replacing all the other taxes like this could work?

Well...maybe.

I believe we need to be a nation of savers not spenders. Too much spending, which is promoted by the government and the Fed with it's ridiculous low interest rate policies, leads to economic bubbles like the real estate bubble.

Too many Americans are debt donkeys to the banks and the stinking government.

Something needs to be done to eliminate the kooky income tax. We know the libs will want a very high sales tax rate. A rate of 20-30% would likely lead to dramatic reduction in consumption and cause considerable unemployment in the short term.

Plus the libs will never go for it, because how could they make it "progressive" to soak the rich?

 

[Lagboltz]

Unfortunately our economy is tied to spending. When spending slows, retailers shut doors and jobs are lost. However I agree, people don't save enough either and max out credit cards, and don't have retirement savings. It seems you can't have it both ways when the mid to lower classes are getting poorer.

I'm a lib and also think a high sales tax rate would lead to disaster especially in the short term, but also in the long term.

 

[PLC1]

Yes, it probably would. But With the housing bubble I think more homes have been constructed than people can afford to buy. And wouldn't it be better for the environment not to keep cutting down more trees to build more houses when there are tons of perfectly good houses out there to buy? Also couldn't construction workers make a lot of money remodeling existing houses to suit new families. Aren't we running out of space and land? It seems to me it would fix more problems than it would create. There would still be new homes built but by the really rich who can afford it or by people not worried about the tax. I would think a tax of that size would be done in payments, I think the same goes for new cars.


Also, wouldn't the price of new homes go down substantially? There would be no more taxes for your employees payroll for the builders to build or any of the other taxes it takes today to build a house. I think that would bring the price of new home construction.

Overbuilding of new homes has ended rather abruptly due to the recession and the popping of the housing bubble. There will no doubt be some new homes built in the next few years, but nothing like we saw leading up to the crash. I think that problem took care of itself. Yes, there are a lot of homes with no one living in them just now. If and when the nation gets back to work, people currently without a home of their own will start to buy.

However, if new homes cost tens of thousands more than existing homes, no one would build, and we'd eventually see a lack of housing, which would lead to an increase in prices due to supply and demand. If a sales tax is to cover real estate (I think they do that in Canada), it would have to apply to both new and existing. Same with cars. It is double taxation to charge sales taxes on used cars, but if only new cars were taxes, there would be a huge incentive to buy used, and the car manufacturers would take a big hit.

There are lots of unintended consequences with any major change in tax laws.

What about services? Should they be subject to a tax as well? Currently, Taxifornia only charges sales taxes on goods, not services, and not on groceries.

If the national sales tax is to raise enough revenues to supplant the income tax, it will have to be pretty high, and/or cover everything.

 

[pocketfullofshells]

Overbuilding of new homes has ended rather abruptly due to the recession and the popping of the housing bubble. There will no doubt be some new homes built in the next few years, but nothing like we saw leading up to the crash. I think that problem took care of itself. Yes, there are a lot of homes with no one living in them just now. If and when the nation gets back to work, people currently without a home of their own will start to buy.

However, if new homes cost tens of thousands more than existing homes, no one would build, and we'd eventually see a lack of housing, which would lead to an increase in prices due to supply and demand. If a sales tax is to cover real estate (I think they do that in Canada), it would have to apply to both new and existing. Same with cars. It is double taxation to charge sales taxes on used cars, but if only new cars were taxes, there would be a huge incentive to buy used, and the car manufacturers would take a big hit.

There are lots of unintended consequences with any major change in tax laws.

What about services? Should they be subject to a tax as well? Currently, Taxifornia only charges sales taxes on goods, not services, and not on groceries.

If the national sales tax is to raise enough revenues to supplant the income tax, it will have to be pretty high, and/or cover everything.

New car sales would be crushed as well...costing more jobs if we only tax new ones.

 

[Pandora]

Unfortunately our economy is tied to spending. When spending slows, retailers shut doors and jobs are lost. However I agree, people don't save enough either and max out credit cards, and don't have retirement savings. It seems you can't have it both ways when the mid to lower classes are getting poorer.

I'm a lib and also think a high sales tax rate would lead to disaster especially in the short term, but also in the long term.

well all the taxes would be on what you are spending money on so it seems like a match.

I think spending could increase. you would have more in your paycheck because they are not taking for federal taxes anymore, the items could come down in price because the employers are paying less for the employees since they are not paying all the taxes for them and yes the price from taxes would go up but it wouldn't seem as high as it is since your pay is more and the cost of the actual item is less.

 

[Pandora]

Overbuilding of new homes has ended rather abruptly due to the recession and the popping of the housing bubble. There will no doubt be some new homes built in the next few years, but nothing like we saw leading up to the crash. I think that problem took care of itself. Yes, there are a lot of homes with no one living in them just now. If and when the nation gets back to work, people currently without a home of their own will start to buy.

However, if new homes cost tens of thousands more than existing homes, no one would build, and we'd eventually see a lack of housing, which would lead to an increase in prices due to supply and demand. If a sales tax is to cover real estate (I think they do that in Canada), it would have to apply to both new and existing. Same with cars. It is double taxation to charge sales taxes on used cars, but if only new cars were taxes, there would be a huge incentive to buy used, and the car manufacturers would take a big hit.

There are lots of unintended consequences with any major change in tax laws.

What about services? Should they be subject to a tax as well? Currently, Taxifornia only charges sales taxes on goods, not services, and not on groceries.

If the national sales tax is to raise enough revenues to supplant the income tax, it will have to be pretty high, and/or cover everything.

I never thought about taxing services, I think about products and goods as being taxable. If I were better at math I could work out how much you would save by not paying the feds then average monthly cost to what the tax would be on a person and see how much it would hurt. I don't think it would hurt the average joe $$ wise as much as it would hurt the really rich.

No services are taxed in Calif? Dang oregon gets us on cell and home phones, internet and cable but I can't think of anything else except fees

 

[pocketfullofshells]

I never thought about taxing services, I think about products and goods as being taxable. If I were better at math I could work out how much you would save by not paying the feds then average monthly cost to what the tax would be on a person and see how much it would hurt. I don't think it would hurt the average joe $$ wise as much as it would hurt the really rich.

No services are taxed in Calif? Dang oregon gets us on cell and home phones, internet and cable but I can't think of anything else except fees

the US is more and more Serviced based...if your going to get all the income from a sales tax, you can't ignore services being that they are one of the biggest areas of spending.

 

[Pandora]

the US is more and more Serviced based...if your going to get all the income from a sales tax, you can't ignore services being that they are one of the biggest areas of spending.

Well all we need is enough revenue to cover what IRS takes, if it can be done with out taxing services then we should not tax service

 

[pocketfullofshells]

Well all we need is enough revenue to cover what IRS takes, if it can be done with out taxing services then we should not tax service

If you don't tax service your just taxing other things more...

if you need x amount of money to run something...and you pay it in 3 types of taxes...if you lower one type...but plan to run the same thing...then you must raise the others to make up for it.

So tax services or you have to tax more for all products...again saying that in your "free market" services are valued over products, and you discourage large item tickets that are new, and favor older out of date inefficient ones.

Your free market sounds very inefficient and not very free now does it not?

 

[Pandora]

If you don't tax service your just taxing other things more...

if you need x amount of money to run something...and you pay it in 3 types of taxes...if you lower one type...but plan to run the same thing...then you must raise the others to make up for it.

So tax services or you have to tax more for all products...again saying that in your "free market" services are valued over products, and you discourage large item tickets that are new, and favor older out of date inefficient ones.

Your free market sounds very inefficient and not very free now does it not?

OK im sold on that idea, taxing services equally to goods would lower the percent the gov would need per item

I still don't like the double taxing idea on used cars and used houses. But no one gets everything they want.

OK do you think it could work if all goods and services were taxed but now at a lower rate like 10 or 15 percent?