Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[Reelya]

Well there's a big question there. We look at some African nations with high VAT and it's implied that it's the high taxes keeping them down. Not from people here specifically, but a general idea "lol high taxes".

But if you look at those nations total GDP, and government expenditure they usually have pretty low government spending per GDP. For example, Madagascar has a VAT of 20%. Just picking a poor country with high VAT purely at random to make a point. Their GDP is $10 billion. High taxes must be impeding growth, right? That's why they're a poor country, right? But their total government expenditures are 10% of GDP, which is about 1 quarter of what the USA spends relative to their economic size. The place should be a Libertarian's paradise by now.

Perhaps the issue is that in a poor country with bad infrastructure, it's hard to collect the sorts of taxes that technocracies such as the USA does. But applying tariffs and sales taxes is relatively easy to keep track of and catch cheats. So it would be expected that Madagascar gets its revenue from a different mix of taxes than the USA.

Only problem is that the one frumple linked and has tariffs, http://www.indexmundi.com/facts/indicators/TM.TAX.MRCH.SM.AR.ZS/rankings, has countries that don't show up in the one I had found earlier with VAT http://www.uscib.org/valueadded-taxes-vat-ud-1676/ It might be a somewhat biased source because it may be selective.

Also, Trump isn't doing it because he wants to keep track of and catch cheats, he wanted to extort Mexico.

Well maybe we should double-check the original point African nations having high VAT, which I was responding to.
https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates

Turns out I couldn't find anything to back that up, so any other conjectures based on that are going to be flawed. Some of the wealthiest nations in Europe in fact top the VAT tables.

[smjjames]

Well there's a big question there. We look at some African nations with high VAT and it's implied that it's the high taxes keeping them down. Not from people here specifically, but a general idea "lol high taxes".

But if you look at those nations total GDP, and government expenditure they usually have pretty low government spending per GDP. For example, Madagascar has a VAT of 20%. Just picking a poor country with high VAT purely at random to make a point. Their GDP is $10 billion. High taxes must be impeding growth, right? That's why they're a poor country, right? But their total government expenditures are 10% of GDP, which is about 1 quarter of what the USA spends relative to their economic size. The place should be a Libertarian's paradise by now.

Perhaps the issue is that in a poor country with bad infrastructure, it's hard to collect the sorts of taxes that technocracies such as the USA does. But applying tariffs and sales taxes is relatively easy to keep track of and catch cheats. So it would be expected that Madagascar gets its revenue from a different mix of taxes than the USA.

Only problem is that the one frumple linked and has tariffs, http://www.indexmundi.com/facts/indicators/TM.TAX.MRCH.SM.AR.ZS/rankings, has countries that don't show up in the one I had found earlier with VAT http://www.uscib.org/valueadded-taxes-vat-ud-1676/ It might be a somewhat biased source because it may be selective.

Also, Trump isn't doing it because he wants to keep track of and catch cheats, he wanted to extort Mexico.

Well maybe we should double-check the original point African nations having high VAT, which I was responding to.
https://en.wikipedia.org/wiki/List_of_countries_by_tax_rates

Turns out I couldn't find anything to back that up, so any other conjectures based on that are going to be flawed

Derp, why didn't I just go and check wiki, but yeah, I was honestly confused as to which was a tariff and which was a VAT and the difference between the two

[Frumple]

... if by many, we're talkin', like. Four? Few more in the 24-22 range, but you don't really see anything particularly approaching numerous until you hit 21. And all of them have pretty substantial reductions all over the place. Good sprinkle of the same range in non european countries, too, for what that's worth.

More than twenty's pretty uncommon, actually, and unilaterally applied VATs functionally nonexistent. Maybe there's a more notable trend for ones aimed specifically at certain countries, but I wouldn't even particularly know where to start looking for that kind of information, sort of actually starting to dig through individual countries' taxation information (hahaha, no.).

E: Oh, wait, the many was edited out, as was the 25% figure mentioned. Ah well. Just going to preemptively back out, that's the most I'm going to try to play whackamole today, heh.

[Sheb]

VAT in the 20's are not unheard of in Europe. We pay 21% in Belgium*, I'm fairly certain  it's 19% in France. It should also be noted that  a VAT is not a tariff. A tariff advantage your own producers in your own market because it's a tax that is only paid on imported products. The VAT is paid equally on all products, so your producers don't have an advantage in your market.


*Although we have variable rates, stuff considered "essential" like food are taxed at a much lower rate, about 6%. Of note, there was a bit of a rucus recently by feminist arguing that tampons and co should be moved from teh 21% to the 6% brackets. They pointed out that razors and shaving cream are considered essential after all.

[Reelya]

Australia has that exact same debate, they're saying tampons should be tax exempt. Also, the total amount saved by women by doing that is reported to be paltry. It's one of the non-issues that distracts activists from fighting for things that are actually going to make a concrete difference to women's lives. In fact, it will make women's live worse.

The thing is, Tampons are, by their nature, not a discretionary purchase. They're a necessary purchase. But this doesn't mean it's a good idea to tax-exempt them or that tax exempting them helps women. The problem is that when you cut a tax, the saving is passed on to the consumer, because the company wants to sell more of the product. But that's not going to happen for tampons, precisely because they're not a discretionary purchase. Are women going to use 5% more tampons if the price drops 5% No way, so they won't drop the price. They'd lose more than they make. You just need a set amount of tampons, and that's it. Therefore the most efficient price for the market is the current price, and the tax savings will not be passed on to the consumer.

So the price isn't going to drop for tampons because it makes no economic sense for the manufacturers to even do that. But now you lost a big chunk of millions of dollars in taxes. So you need to cut single parents benefits, child benefits, etc etc, basically a ton of things that are in place to enable poorer women to survive. All so some wealthy upper middle class women can feel smug that they got rid of the tax.

[LoSboccacc]

eh, if they want to save money on that, give them daisy cups. welfare stuff should be the most price effective, since money has to come from someone else (all of us).

[martinuzz]

Holy fucking buttshit, that Bannon. He really thinks that the media is gonna just curl up and die just because he tells them to? What a complete moron.

https://www.nytimes.com/2017/01/26/business/media/stephen-bannon-trump-news-media.html?_r=0

[LoSboccacc]

Holy fucking buttshit, that Bannon. He really thinks that the media is gonna just curl up and die just because he tells them to? What a complete moron.

https://www.nytimes.com/2017/01/26/business/media/stephen-bannon-trump-news-media.html?_r=0

Trump team must have mistaken again swearing in with crowning, even if it's easy to tell, as there was no Pope. But I can see how they got confused...

[Sergarr]

Holy fucking buttshit, that Bannon. He really thinks that the media is gonna just curl up and die just because he tells them to? What a complete moron.

https://www.nytimes.com/2017/01/26/business/media/stephen-bannon-trump-news-media.html?_r=0

Trump Strategist Steve Bannon Says Media Should ‘Keep Its Mouth Shut’

Already posted.

[Neonivek]

Well I'd ask if Trump has started threatening the media... but... that has already happened

But has he (or his team) started to SERIOUSLY threaten the media yet?

Well other then his "Lets make Libel laws extra loose"

[Reelya]

eh, if they want to save money on that, give them daisy cups. welfare stuff should be the most price effective, since money has to come from someone else (all of us).

What do poor people do with the money however?  If you e.g. give 30,000 people $10K to live on, they have to spend it. Say 2/3rds of that goes to creating minimum-wage jobs and you set those at $20K. That just made 10,000 jobs to feed/cloth/house the other 30000. But those 10,000 people are going to spend their money, and 2/3ds of that is also going to spent on wages, so you get another 6666 jobs happening, and those people spending create another 4444 jobs and so on. If you do the limit sum for that you get a total number of jobs created of .... 30000. Those are just rough numbers but they happened to work out that way. My point is that by setting the right minimum wage and welfare payments, you can in fact create more actual jobs than the number of "slackers" you create. Part of the reason this works is that labor is an under-utilized resource. People have plenty of time to spare, but we have finite limits of other resources. We can run out of steel, but it'd take a hell of a lot of effort for us to run out of people who have spare time.

[MetalSlimeHunt]

The public dressing down of the press for not reporting how Trump wants, among violation of other norms that nobody else would even consider, counts as threats in my book. It's very much in the style of a power-tripping corporate executive shouting out a PR intern for using the wrong wording in a public statement, and shows that the administration is approaching the media from the stance that they're meant to take orders from Trump or they're out.

[Sheb]

Australia has that exact same debate, they're saying tampons should be tax exempt. Also, the total amount saved by women by doing that is reported to be paltry. It's one of the non-issues that distracts activists from fighting for things that are actually going to make a concrete difference to women's lives. In fact, it will make women's live worse.

Until a company realize they can make their product cheaper to try to grab market share. By your logic, we should tax tampons extra to make women's live better.

eh, if they want to save money on that, give them daisy cups. welfare stuff should be the most price effective, since money has to come from someone else (all of us).

This isn't welfare, it's tax rate. Stuff that you need is taxed less, be it food, transportation (bus tickets and so on), electricity, medical supplies, soap and now also tampons.  I mean, you could argue that we'd be better off taxing all those more and using the proceed to give welfare check to those who needs them, but it's another debate.

[Reelya]

They can make the product cheaper right now to gain market share. The real question is whether they'd gain market share faster than they'd lose profits.

- e.g. say a tampon pack is $10, $2 to produce, $2 tax. So $6 in profits. Say market share is 1 million sales. They're making $6 million in profits.
- if you drop your price by $1 then you'd need a 15% market share increase to cover the lost revenue. Because you pay less tax on the cheaper price, the profit at $9 = 9-2-1.8 = $5.20, and to make $6 million with that, you'd need to sell 1153846 units.
- if you drop your price by $2 then you'd need a 36% market share increase to cover the lost revenue. Profits at this price would be 8-2-1.6 = $4.40. So you'd need to sell 1363636 units.

Because they haven't done such price cuts already, we can assume that these numbers represent the absolute limit of how much your market share would increase if your dropped your price to those levels. These numbers are handy to know, because we can work out a profit estimate for the scenario without the taxes:

- With no tax a $10 pack makes $8 in profit. So $8 million at 1 million sales.
- If they now drop price to $9, then they're making $7 per pack. For that to make more than $8 million you have to increase market share to 1142857. But we already worked out that they'll sell at most 1153846 units @ $9. So best-case scenario the $1 price drop nets them extra profit of $76922. Which is less than a 1% increase.
- If they now drop price to $8, then they're making $6 per pack. For that to make more than $8 million you have to increase market share to 1333333. But we already worked out that they'll sell at most 1363636 units @ $8. So best-case scenario the $2 price drop nets them extra profit of $181816. Which is a 2.2% increase.

So by completely passing on the 20% tax break, any one company (or store selling them) could make at best 2.2% more profits, assuming that it's not profitable to drop the price now, but it would be if the 20% tax was eliminated.

[Sheb]

Well, looking at France (where the VAT on tampons was dropped from 20 to 5.5%), it seems that there was a lot of variation between stores chain, with drop of between 12 and 0% depending on the brand.