Here’s a blurb from a Wall Street Journal Editorial this morning. It seems a high tax rate is leading to less revenue. When will the politicians finally learn?
What do you do about a tax that costs jobs and raises little money? Florida lawmakers have been pondering that question in relation to the 6% registration tax for owning a boat in the Sunshine State. If you buy a $1 million boat and register it in Florida, you currently pay $60,000 in sales taxes. If you buy the same boat and register it in another coastal state like North Carolina, you pay a maximum of $1,500, in South Carolina $500, and in Rhode Island $600. Even more common is to register the boat in a nearby foreign nation like the Cayman Islands, where you pay close to zero tax. So to refloat the boat business, the Florida House voted last Wednesday to cap the boat sales tax at $18,000. This is roughly the amount of legal costs to register a yacht in the Caymans. Opponents call the repeal a tax cut for the leisure class, and the state’s official revenue estimators predict it will cost $1.4 million a year in lost revenue. This ignores some basic math: Collecting $18,000 per yacht beats getting nothing. …An estimated eight in 10 expensive boats in Florida are registered somewhere else, mostly abroad, and a boating industry study estimates this costs the state $120 million in lost revenue. …This tale is reminiscent of the 10% luxury tax on yachts costing more than $100,000 that Congress passed in 1990. That tax, also passed in the name of social justice, nearly ruined the boat-building industry in states like Florida and Maine, because the rich went to the Bahamas and elsewhere to buy their boats until Congress repealed the yacht tax in 1993.
[…] have similar examples of counterproductive class warfare in the United States. Florida politicians shot themselves in the foot a number of years ago with high taxes on […]
[…] as well as Bulgaria and Romania. Or states such as Illinois, Oregon, Florida, Maryland, Washington, DC, and New […]
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[…] (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer […]
[…] Italy, France, Spain, as well as Bulgaria and Romania. Or states such as Illinois, Oregon, Florida, Maryland, Washington, DC, and New […]
[…] Italy, France, Spain, as well as Bulgaria and Romania. Or states such as Illinois, Oregon, Florida, Maryland, Washington, DC, and New […]
[…] (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer […]
[…] whether we’re looking at Italy, France, or Spain. Or states such as Illinois, Oregon, Florida, Maryland, and New […]
[…] world (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer Curve. Not that it makes […]
[…] (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer […]
[…] (England, Italy, the United States, and France) and from various states (Illinois, Oregon, Florida,Maryland, and New York) to argue that it is foolish to ignore the Laffer […]
[…] from around the world (England, Spain, and France) and in various states (Illinois, Oregon, Florida, Maryland, and New York) to make the case that it is foolish to ignore the Laffer Curve. Not […]
[…] Many politicians fail to realize, however, that not all tax cuts are created equal. While taxpayers generally will be happy with any change that allows them to keep more of the money they earn, good tax policy should strive to reduce marginal tax rates on productive behavior. Sometimes known as supply-side economics, this is the simple notion that lower tax rates will boost work, saving, investment, and entrepreneurship. Higher tax rates, by contrast, discourage people from generating more income. […]
“…or much of anything but money and power.”
Take out ‘money’ and you’re spot on.
As you have pointed out politicians refuse to understand the Laffer Curve or much of anything but money and power.