Re: (OPE-L) another bit about taxation

From: Anders Ekeland (anders.ekeland@ONLINE.NO)
Date: Wed Jun 02 2004 - 01:52:29 EDT

Thanks too everybody that responded to my question about taxes,

The answers brought forward a lot of interesting info on Marx' view of
taxes, but my questions were started from a feeling that so much has
changed since Marx time, at least here in the Nordic countries. The taxes
share of GDP, the right of all women and men to vote, our experiences with
bureaucracy in the state, in the labour movement etc. that was time to see
if the old rules of thumb (no to indirect taxes, yes to progressive taxes)
still were valid.

As far as I can see nobody responded directly my questions, in particular:

- What would be the effect of an non-refundable indirect tax of say 5- 10%?
Since there is a lot of tax evasion from firms and rich persons, a turnover
tax would actually hit them more than the complicated system of income
taxes, that on paper is progressive but in reality is much less so -  some
economists in Norway argue that the tax system is in fact regressive for
the really rich.

- That progressive taxes, i.e. the labour movement using its political
power to correct injustices created in the market, shifts peoples political
focus away from the injustices of the market economy and making them
concerned about the complexities (injustices and irrationalities) of the
tax system. With a radical simplification of the system - a turnover tax -
political focus could shift the power struggle back to the market
correcting the injustices where they are created.

- Unlike in Marx time, everybody can vote and decide what the taxes are
going to be spendt on. That the democratic system is *very* imperfect is
obvious, but still people have a fair amount of influence on gov. policies.
That I believe they vote against their true interest is another issue.

I do not think that there is something wrong with using progressive taxes -
of course not, but maybe we then should make them dramatically progressive,
so that in practice progressive taxation ensured that nobody had more that
the double of average industrial workers wage as after-tax income. Such a
drastic measure would signal that one did not see such high incomes as
nothing else than exploitation - as at least I do.

Anders Ekeland

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