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I like to use an analytic approach when trying to understand a scheme. To set the rates of a multilevel tax plan would require knowing how much is spent on the various items in each level. The top level is equivalent to a luxury tax, which was tried in the past and failed because these items have a large price elasticity -- sales dropped and industries suffered.All the data necessary to explore a multilevel tax is available, but to compute various schemes would require a few weeks of work. It was easier to compute flat sales tax. However post #88 above shows that it would be imperative for the second level to be around 29.2%. Sales would suffer there too.
I like to use an analytic approach when trying to understand a scheme. To set the rates of a multilevel tax plan would require knowing how much is spent on the various items in each level. The top level is equivalent to a luxury tax, which was tried in the past and failed because these items have a large price elasticity -- sales dropped and industries suffered.
All the data necessary to explore a multilevel tax is available, but to compute various schemes would require a few weeks of work. It was easier to compute flat sales tax. However post #88 above shows that it would be imperative for the second level to be around 29.2%. Sales would suffer there too.
