Centerfield

Unfortunately, tax revenue as % of GDP doesn't tell the whole story as to whether or not a country is economically prosperous. It's just one factor among many.

I would encourage everyone to check out the annual Economic Freedom of the World Report for 2004. It gives a far more comprehensive look at how countries rank among ecomomic categories and how it relates to prosperity.

http://www.cato.org/pubs/efw/

The table only shows federal-level taxation, and so misses a good chunk of the overall taxation rate in the US. Local sales taxes, property taxes, and state income taxes add a good bit to the overall burden.

Tully,

Are you sure about that? I don't see any such qualification in the description. It would be a pretty lame study if that's all it did

Can someone explain to me why "Tax Revenue as % of GDP" is such an important measure? In all sincerity, I want to understand why that figure is more important than one more relevant to me, which is the amount of money that I earn but never deposit in my bank account.

Whether or not this is true, it seems to me it is not an accurate picture of quality of life. If taxes are low, but you have lousy schools, poor infrastructure, lots of poverty, and poor health care due to the low taxation (I recognize that is an arguable proposition), I don't think the overall societal well-being is better.

You can obviously argue whether a particular level of taxation is appropriate to provide necessary services, but, IMO, some level of government is necessary beyond the bare minimum to sustain a higher quality of life. Obviously, low taxation benefits people with higher incomes that don't need services as much, but what does it do for people living on the streets, the working class, or those without health insurance? I am certainly not advocating returning to the expropriatory tax levels of the 60s, but I think you have to look at the relationship of taxation to the overall society.

Yeah, MWS, this is a point that i think is well-taken in general. Surely it is arguable what the point is at which taxes become too low to fund "necessary" givernment services.

But IMO it's far less arguable that this point DOES exist. The efficacy of trying to cut taxes when the top marginal rate was 70% seems obvious today.

So, today, as the President has just recently put income tax reform on his short list of top priorities, the few important questions that the broad middle of Americans deserves to have answered is obvious. Right now, these reforms are being sold as a fixing of a complicated outdated etc tax code. FINE,. everyone agreees about that. But the real question is first, will these changes be revenue neutral or not? If the overall revenue generated is less, where do the concurrent cuts come from to pay for the changes?

And 2nd, who will pay more and who will pay less? That's the real "cut to the chase" question.

BK,

I listened to Bush's press conference and he said specifically that he was going to try and make it revenue neutral. I doubt that will happen by the time it gets on his desk, but that's what he said.

We'll see what happens. I think/hope it is the death nail for the Alternative Minimum Tax, but to really close the loopholes of the highest earners, we're going to have to do something about Trusts and single individual corporations. High earners can basically jump back and forth between being under corporate tax law and personal tax law, reaping the benefits of both.

The whole thing is a mess and just like healthcare reform, it has it's tentacles throughout society. If things are changed there will likely be intended and unintended consequences; anywhere from lowering the attraction to municipal bonds to impacting housing prices.

I really look forward to seeing this item being discussed further here at Centerfield as the legislation makes it way through Congress. This is really where centrism can have a big impact on the debate.

This must explain why all the Mexican come to America. They know that our higher taxes are a sign of a more advanced, enlightened society ;-)

I didn't see anything in the tables that attempted to correlate tax rates to the standard of living in those countries.

The US and Switzerland don't have poor living standards relative to the 5 highest taxed states.

Finally, the least taxed states are all states I have always read in the news as being "business friendly" and generally have greater economic opportunity than the top 5 most taxed nations. In fact, the rest of the EU is spitting nails about Ireland's tax rates being an unfair competitive practice.

I agree with what you say - makes sense to me.
Looking for some propecia?