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Least Bad Tax

The following list provides a listing of common tax policies along with some of their strengths and weaknesses, but in many ways, choosing a way to finance a government is like choosing the form of the Destructor from the film, Ghostbusters. See the below excerpt-transcript from the epic film, Ghostbusters. Some taxes are said to be regressive and others progressive, where regressive means it impacts those without as much means to pay the tax, and progressive means it impacts those with more ability to pay.


Tax Scheme Pros Cons Notes Entities that Use Supporters
Personal income tax No choice
Corporate income tax No choice
Natural resources / Land value tax Some choice - usage fee
Property tax (land + improvements) Some choice - usage fee
Property tax (other assets)
Sales tax Choice though less consumption
Estate/Death/Inheritance tax No choice
Poll/Head tax Some choice - usage fee
Import/Export tax (Tariffs) Some choice
Value-Added tax
Capital Gains tax
Excise tax (fuel, alcohol, etc.) Some limited choice, you can walk or not imbibe
Wealth/Net-Worth tax No choice

Choosing a method of financing government can play out a bit like the "Choose the form of the Destructor" scene from the epic film, Ghostbusters. The transcript of the relevant section of the film is below.

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Gozer the Gozerian: Gozer the Gozerian, Gozer the Destructor, Volgus Zildrohar, the Traveler has come. Choose and perish.

Ray Stantz: What do you mean, choose? We don't understand.

Gozer the Gozerian: Choose. Choose the form of the Destructor.

Peter Venkman: Oh, I get it! I get it. Oh! Very cute. [to the others] "Whatever we think of." If we think of J. Edgar Hoover, J. Edgar Hoover will appear and destroy us, okay? So empty your heads. Empty your heads. Don't think of anything. We've only got one shot at this.

Gozer the Gozerian: The choice is made.

Peter Venkman: Whoa! Hold on! Whoa!

Gozer the Gozerian: The Traveler has come.

Peter Venkman: Nobody "choosed" anything! [turns to Egon] Did you choose anything?

Egon Spengler: No.

Peter Venkman: [to Winston] Did you?

Winston Zeddemore: My mind is totally blank.

Peter Venkman: I didn't choose anything! [All three slowly turn to confront Ray]

Ray Stantz: I couldn't help it. It just popped in there.

Peter Venkman: [sternly] What? What just popped in there?

Ray Stantz: I-- I-I tried to think--

Egon Spengler: LOOK! [They all look over one side of the roof]

Ray Stantz: No! It can't be!

Peter Venkman: What is it?

Ray Stantz: It can't be!

Peter Venkman: What did you do, Ray?

Winston Zeddemore: Oh, shi*!

[They all see a giant cubic white head topped with a sailor hat]

Ray Stantz: [resigned] It's the Stay Puft Marshmallow Man.

[the Ghostbusters watch the gigantic form of Mr. Stay-Puft stomping towards them]

Peter Venkman: Well, there's something you don't see every day.

Ray Stantz: I tried to think of the most harmless thing. Something I loved from my childhood, something that could never, ever possibly destroy us: Mr. Stay-Puft.

Peter Venkman: Nice thinkin', Ray.

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