I know all the reasons why sales taxes — i.e. consumption taxes — are to be preferred to income taxes. Every economist I respect believes consumption taxes are better because they let the taxpayer control the amount of tax he pays. Don’t want to pay as much? Don’t buy as much.
But to an ordinary person, this is a silly argument. Everyone has to buy stuff — school clothes for the kids, a new car, a laptop. If your washing machine breaks down, you have to buy a new one or pay for repairs. There is no alternative but to pay the sales tax.
To consumers, a sales tax looks like the least avoidable kind of tax. For most people, the only true way around a consumption tax is to hid their spending by switching to cash, barter or the black market.
On paper, I agree with my economist buds. And if we lived on paper, I might try to convince you to learn to love the HST.
Lorne Gunter, “The HST is fine on paper. It’s only painful in real life”, National Post, 2010-05-07
May 7, 2010
QotD: The HST only looks good on paper
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