In the UK, for example, most employees do not have to file a tax return. The HMRC files it for them and sends them a letter every tax year with their calculation. It even comes with a nice chart to see how much tax you've paid and where it went to (https://secure.i.telegraph.co.uk/multimedia/archive/02871/ta...).
The tax brackets are also very straightfoward and everyone knows which bracket they are in. The same is true with tax on product prices. Everyone knows the tax rate on items because it's a simple number and there's a lot of public discussion whenever politicians decide on reducing/increasing it. If you ask anyone in the UK (or any other country other than the US with VAT) what the current VAT rate is, they will be able to tell you. Good luck getting an answer to such a question from someone in the US; you just pay what the cashier tells you to as VAT depends on so many factors.
> I guess that is why it is not included in the price by default
I hear that argument a lot but it does not really make sense to me. The place of purchase knowns what their tax rate is in their current location because the cash register has that information (and I assume this sales tax does not change very frequently?). So why not print out or display the prices with that tax included?
Edit: Ok I see, the "you" I had in my post was confusing. VAT is charged on the value added at each point of the chain, again unlike sales/use tax.
In Europe they have a 1 euro menu regardless of what country the burger was sold in (countries have different VAT rates). Some advertising is even shared between smaller countries that speak the same languages.
I really don't care, it's their problem not mine. All I want is for stores, fast food places, etc., to be honest about the price I am to pay.
In Europe, including the UK, it is illegal to advertise only tax-exclusive prices to end customers.
If you want to rail against hidden charges complain about the restaurant welfare system that allows employers to legally under pay and fire employees for not making the majority of their money from tips
Obviously it's beneficial to be able to advertise the lower price, these days assembling your own PC from components must be much less common than it was back then so I imagine even if the decision went in their favour back then that's changed since.
I think if you want to counter the poster, you need to give an example of a western country that has simple/automatic tax systems and have a lower tax rate than the US.
His/her complaint is primarily that if a system is too simple, it's much easier to raise taxes. You're giving exactly the example he/she is looking for - a country where it's easy and the tax is higher.
Now correct me if I am wrong, I have only filed tax in the US for a single tax year so I might be missing something. But for the median household income in California of around $66,529, you would be paying an effective tax rate of around 24%. (using this website: https://smartasset.com/taxes/california-tax-calculator#wWyPf...). And yes, I realize this is excluding deductions.
In the UK, the median household income is £27,300 and you would have an effective tax rate of around 19.6% (https://www.uktaxcalculators.co.uk/), also excluding deductions.
Of course higher salaries attract higher taxes in the UK, but if the above is correct, then the average person should be paying less tax in the UK than in California.
That's a big disclaimer.
I'm not going to argue for a hypothetical. I actually ran the numbers once. My state's income tax rate is high, but lower than CA's. For my income (above median), one year I actually calculated my tax for CA (as in actually got the forms and filled them out).[0] Despite the lower tax rate, the my state's income tax was higher. The reason? CA has a lot more deductions for people of my income or lower. CA can get you in all kinds of other taxes, but not income tax.
Also, just checked. Other than the deductions, for single people, you hit the second highest bracket at a little over $8K in my state. To get to that same bracket in CA, you have to earn over $50K. CA tax rates are low for lower income people.
[0] It's a long story why I did this - it was not fun at all.
My point was that taxes in countries where the tax return is automatically performed by the government aren't necessarily higher than in parts of the US. In other words, OP's comment above was nothing more than FUD.
Huh? But you said:
> [their] complaint is primarily that if a system is too simple, it's much easier to raise taxes.
which sounds pretty hypothetical to me! In fact this whole discussion is hypothetical!
> The reason? CA has a lot more deductions for people of my income or lower. CA can get you in all kinds of other taxes, but not income tax
To me, this sounds like a pretty good justification for a simpler tax system ...
In 2019 they will even have automatic taxation for small businesses based on the statistical average for the industry and various signals.
So basically taxation based on machine learning.
You can take it or leave it - it's up to you.
And this also shows that simpler taxation and higher taxation has no relation to each other.
How is a higher tax rate related to the government's ability to provide simple/automated tax returns?
Oh, right, it's not.
Sales tax where I am has similar characteristics - I think most people are perfectly well aware (as I am) that it is generally 8%, but I couldn't tell you exactly which items are exempt, or what the modification is for prepared food or whatever.
So I think you are exaggerating (as people like to do) the difference between the US and the UK.
[1]https://en.wikipedia.org/wiki/Value-added_tax_in_the_United_...
There's no excuse for the sticker price not matching in the US.
Ah, hmm, yes, they just don't realize. Those poor benighted fools.
Or maybe? Maybe they don't care. Take me, for example. I don't care. I've thought about it. I could spend more time screwing with my taxes to optimize my returns, or even go to no withholding whatsoever. Or I could enjoy my finite time on this planet, 'cause the amount of money we're talking about is marginal for me and I do pretty well for myself.
(And to make one thing very clear: the downright fearmongering about a "75% tax rate" are just that and are not worthy of further address. Even were there a salient point in the bottom of this well, this isn't it.)
If everybody just paid the taxes they were supposed to, then we wouldn't need high taxes.
This is simply not true.
As someone who owns a business and has to make quarterly tax payments, paying taxes is painful. I know how much it costs me every time I write a check and I am very reticent to vote for any politician that thinks we should raise those taxes.
On the flip side, I have many friends whose taxes are just pulled out every paycheck. And at the end of the year, they get a tax refund. They act like the government is giving them money! Many don't even seem to realize that all they are getting is a repayment for an interest free loan they have been giving to one of the largest and wealthiest organization/government in the world.
I understand and agree that taxes are important, but if we make it too easy, we make people complacent and the next thing you know, we will wake up with a 75% tax rate.
This is the same reason I disagree with adding the tax in on product prices. People in other countries that do this don't realize how much of the price is going towards taxes - and to keep a government in check, information is key.