16326_3.24_000011088049XSmall

Income Tax Matters

Apr 22, 2011 • Behavioral Economics, Businesses, Demand, Supply, and Markets, Economic Debates, Government, Households, Macroeconomic Measurement • 211 Views    No Comments

Woodrow Wilson once said that paying taxes was a “glorious privilege.”

However, a recent Gallup poll confirmed what we probably already knew. Most of us do not want to pay higher taxes.

Upper income households (67% of those polled) say current taxes are too high. Middle income households (51% of those polled) also believe their taxes are too high. And almost everyone agrees that lower income households should not pay more.

Should anyone pay more to diminish the deficit? This Marist poll indicates that 83% of all Democrats, 43% of all Republicans, and 63% of all Independents who were polled said, “increase taxes on incomes over $250,000.”

Perhaps, though, Steven Weisman, in the Epilogue to his book The Great Tax Wars, best sums up the debate when he says it is really all about our attitude toward wealth:

The income tax “… has been an … appealing tax for those who … see wealth as a product of good luck, exploitation of others, political favoritism, and predatory conduct…It has been objectionable tax for those who tend to see wealth as the logical reward for hard work, thrift, ingenuity and other admirable forms of behavior.” (p. 350)

You might also look at this past econlife for other “taxing issues.”

The Economic Lesson

In his Teaching Company lecture on taxes (#11), Professor Robert Whaples explains the complex issues that need to be resolved when we want to create an efficient tax system that is fair, simple and enforceable.

Or maybe we should just remember what Jean Baptiste Colbert, Minister of Finance under Louis XIV said, “The art of taxation consists in so plucking the goose as to get the most feathers with the least hissing.”

 

Related Posts

« »