Tax Subsidizing the American Consumer

by watson 22 Replies latest jw friends

• 

  Berengaria

  But an examination of the American tax code indicates that oil production is among the most heavily subsidized businesses, with tax breaks available at virtually every stage of the exploration and extraction process.

  According to the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.

  And for many small and midsize oil companies, the tax on capital investments is so low that it is more than eliminated by var-ious credits. These companies’ returns on those investments are often higher after taxes than before.

  http://www.nytimes.com/2010/07/04/business/04bptax.html
• 

  leavingwt

  If the oil subsidies stop, how will this effect the price of gasoline at the pump? If it equals an increase in the retail price, how substantial would that be? Voters will support the oil subsidies if stopping the subsidies means higher gas prices.
• 

  Berengaria

  So we get taxed to save on the cost of gasoline? Meanwhile, infrastructure is neglected and Kiribati sinks in favor of Tony Hayward's Yacht.
• 

  journey-on

  So how is that any different than consumer's who work in those fake government jobs using their paychecks to spend?

  Well, think about it. What is the difference?

  The spending on consumer goods is good no matter who is spending, whether it's someone with a private sector job or a government job. It's healthy for businesses. More sales, more customers, more revenue, more creation of private sector jobs. The only difference is once the job is created, it is up to the business or corporation to pay that person....not the tax payers. That's the difference. When government becomes so big and bulky, they have to tax tax tax in order to pay for it. When the tipping point is reached, consumers have less of their own money to spend, businesses lose revenue (plus they also are burdened with taxes and fees of all kinds), they stop hiring, they begin to lay off, and real economic health begins to fade. Oh, they can put a bandaid on it here and there or give it a little shot in the arm to temporarily mask the disease, but Big Government cannot cure anything!
• 

  Berengaria

  I was talking about tax subsidies on second homes. Watson's question.

  Isn't allowing tax deductions on optional "conumer" benefits a way to cut spending?

  No. It's a way to hinder the consumer. It cuts the consumer's spending. Not good for the general economy.

  Which is what cutting government jobs would do. Cut consumer spending.
• 

  Berengaria

  Taxes are at thier lowest point in 60 years.
• 

  journey-on

  Maybe the solution would be that if your paycheck comes from the Government (taxpayers), your taxes should be raised. Plus, I think all Congressmen should get a DECREASE in pay......AND their fancy luxury benefit package. They haven't exactly been doing a good job. If they were in the private sector, their merit raises would have been nil since 2006! (Edit: nil for decades!!!)
• 

  Berengaria

  Thus decreasing consumer spending...............oops.
• 

  Texas Apostate

  I know one thing, that deduction really helped the big housing boom, that's for sure. How's that going, anyway?

  You can blame Clinton and Bush for that. Allowing every Tom, Dick and Harry to buy a home they couldn't really afford in the first place with virtually no credit history. Giving them ARM notes, sub-prime lending.

  I can give you a personal experience. In my typical middle-class-working-stiff kind of a neighborhood, there was one family that bought a home similar to ours. Two story, 2800 sq. ft. home. As a matter of fact it was one of the model homes for the neighborhood.

  This family pretty much decided to move themselves out of the ghetto into this home. How they qualified for a loan is between them and the bank. When they first moved in they seemed very nice. Older man and wife, with a teen and 10 yr old daughters. They would at first maintain the home. Then after a year, his older son moved in. We would sometimes get home late (1 or 2am) from attending a dance or something, and you would see about 10-12 people just hanging outside drinking and smoking. Then came the late night cop visits. Then we found out, that both the father and son were registered sex offenders from NC. Son was arrested for not registerion here in Texas.

  Almost 4 years to the day the moved in they were forced to move out, because the house was forclosed on them for not making a payment in a year. We went to look at the house as it was open for auctioning. There was an old 90s cadillac all jacked up in the front with flat tires left in the driveway. The garage door was all banged up. The people ripped off the sinks from the bathroom. The wooded floors were scrathed up like crazy. There were holes in the sheetrock. The carpet had burn holes and dirt spots everywhere. There where broken windows. The back lawn was over grown and look like crap.

  Those people would have never qualified for a home if the lending practices were tightened up to weed out trashy people like that. But no. Clinton-Bush-Obama believe everyone is entitled to same things responsible, law-abiding, working-class, not looking for a govment hand-out kind of people.

  Just one experienced that played out thousands of time around the country. And dont get me started on the brokers, home builders, survey companies, title loan officers, and bankers that enabled them.
• 

  journey-on

  Thus decreasing consumer spending...............oops.

  Hey, listen, Berengaria. I'm just sayin'.....you want to raise taxes on someone, that's a good place to start, imo.