Talk:Indirect tax

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[edit] Comment

This entry is completely incorrect. An economist with some spare time on his or her hands should write a proper entry. I have no idea why anyone who thinks that a sales tax is an "indirect tax" would submit an entry on this topic. Indirect taxes are paid as higher prices; direct taxes as taxes.

[Note: The above comment was posted by an anonymous user at IP 72.137.63.75 on 16 June 2006.]

Editor's note: The comment that the "entry" (the main article) is "completely incorrect" is itself incorrect. An economist with spare time on his or her hands is certainly welcome to take a crack at this or any other article in Wikipedia. However, the term "indirect tax," while it may have a different meaning to the anonymous user, is a legal term, and has technical legal meanings that are correctly described in the article. The senses in which the anonymous user is ascribing to the terms direct taxes and indirect taxes are separate senses. Perhaps those can be discussed in the article as well.

If you will look at any large, unabridged dictionary of the English language, you will find that many words have multiple meanings. Terms like "direct tax" and "indirect tax," as stated above, also have technical legal meanings -- and the user at IP 72.137.63.75 apparently is not familiar with the technical legal use of these terms. Yours, Famspear 15:17, 16 June 2006 (UTC)

[edit] Enigmatic language

I moved the following language from the article:

Indirect taxes are not proportional to the income of the tax-payer. i.e. If a wealthy person and a poorer person were to buy the same goods, costing the same amount, the poorer person would pay a greater amount of their income as they would be taxed the same amount as the wealthy taxpayer.

First of all, the discussion could apply just as well to direct taxes (such as, in the United States, a national property tax -- if there were such a thing). Second, the discussion seems to be confusing various concepts. We need to determine what kind of indirect tax we're talking about first. An income tax? Gasoline excise tax? Sales tax? National tax? State tax? Which country?

If a rich person and a poor person buy the same goods costing the same amount, the rich person is of course using a lower PERCENTAGE of his or her money (a lower percentage of income, if you like) than is the poor person. Indeed, that's true even if no sales tax or other tax at all is imposed. If we are talking about the SALES TAX on that particular item, it is also true that for the rich person, the ratio of the dollar amount of the sales tax to the rich person's income (i.e., the higher income person, which is what I assume was meant) is going to be lower than the ratio of that same dollar amount of sales tax is to the income of the poorer person.

If on the other hand we're talking about income taxes, then it somewhat confuses the issue to be talking about buying goods. Assuming an absolutely flat single rate of tax, with no special income exclusions, deductions or credits for anyone (which, of course, is not the case in the USA), both the rich person and the poor person would being paying at the same proportion.

Maybe the material can be re-worked (?). Famspear 19:46, 25 January 2007 (UTC)