Which taxes are smart taxes?

Question

Some taxes have a more positive effect on the economy, while others are a drag. Which are the most efficient? Corporate, personal income, consumption, behavior modifying (gas, energy, alcohol) or others?

Please only educated responses. Thanks.

Answer 1

I would argue that consumption taxes are the best type of taxes, as all taxes impact consumption anyways, and it would be best if everyone was cognizant daily of government's total costs.

However, best is defined by my value system, which holds individual responsibility as a important factor in governmental policymaking. Others, who may have a more egalitarian world view, may see an income tax good as it punishes success, making everyone's financial outcomes "more equal." I think that's why we have the mishmash of taxes that we have today, to suit everyone's value system.

So why not let's have a national sales tax too?