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Proof-Variation7005 t1_j4v2285 wrote

Reply to comment by degggendorf in State of the State address by FlashbackBob

It’s something that offers no tangible benefit to a person. Even a fairly affluent household that’s spending $100,000 a year on taxable goods and services is saving $150 over the course of a year. And that’s for the super rich, most people don’t spend close to that much.

I’d rather keep the sales tax where it is and let some of the revenue burden by shared by the 25 million or so tourists who come here every year.

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degggendorf t1_j4v9ae2 wrote

If it were up to me, I'd add more sales tax tiers.

Unlike us, CT does normally charge sales tax on clothing but has an annual back-to-school season tax-free week, where clothing under $50/item is tax free. I think it would make perfect sense for us to implement something similar. Instead of all clothing being tax-free all the time, only charge sales tax on individual items over $50 or $100 or something. I see no reason why we need to subsidize higher-end clothing.

Similarly, RI charges the same tax rate on all vehicles but CT has a higher bracket for vehicles over $50,000 (7.75% vs their normal 6.35%). Maybe that dollar limit should be bumped up a bit more for 2023, but I like the idea. No reason the $100,000 Mercedes buyer can't pay a bit more tax. I'd be tempted to add another tier for <$30,000 vehicles to pay lower than normal tax too.

Beyond that, we already have the mechanism in the grocery store that defines what foods are SNAP eligible...the foods that are generally good things to eat. Why not tax the non-SNAP "not good" foods too?

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Proof-Variation7005 t1_j4va6il wrote

I like it. Hell, we can just copy MA and make groceries tax free outright.

For normal purchases, I’d just go to whatever that Laffer curve number is for the ideal rate. I wanna say it’s around 6.5% or something

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degggendorf t1_j4ve25i wrote

> copy MA and make groceries tax free outright.

Food is already tax-free in RI. I am suggesting re-adding sales tax to the not-a-staple foods like aren't SNAP eligible.

> I’d just go to whatever that Laffer curve number is for the ideal rate

That's a new term to me, thanks for bringing it up. Reading about it now though, it seems limited. There is more to taxation than raw receipts, and requiring a single rate seems unnecessary. We could exceed the Laffer ideal if we tax different things at different rates, as well as achieve broader societal goals if we tax the poor less than the wealthy, and encourage eating celery over frozen pizza.

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therealDrA t1_j4vxfq7 wrote

The Laffer curve was debunked 40 years ago. Laffer was a hack economist that was part of the Reagan trickle down squad.

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Proof-Variation7005 t1_j4xsw7s wrote

For other taxes, sure. It’s bullshit. For sales tax, there’s definitely truth to it. There’s a point where the rate gets high enough where revenue will start to drop as consumer habits evolve. This is especially true when 99% could easily go to one of two other states to make purchases.

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therealDrA t1_j4xyoq8 wrote

But for the current example I don't think the laffer curve is in play.

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