Hacker News Reader

Comment by SkeuomorphicBee | Hacker News Reader

The USA really needs better consumer protection laws. In my country that would clearly be an illegal bundled sale and illegal bait and switch. If you advertise product A for X amount, then a customer with X amount in their pocket should be allowed to walk out with product A, any deviation from that should be illegal.

(slightly off topic, but in my country consumer laws also mandate that sticker and advertised prices must be the final price including all taxes. The standard USA practice of stickers/adverts with pre-tax price is also absurdly anti-consumer).

View on HN

Sales tax in the US is not a Value Added Tax, so putting just the post tax price on the sticker is not actually enough, the sticker would need the pre-tax price too, as some purchases can be exempt from sales tax.

Most VAT based countries have a single VAT rate for the whole country (or possible a country-wide set of rates for different types of products). The United States is not like that. Even if we consider an individual state as the equivalent to Country, each state does not have one consistent sales tax rate.

Typically the state will have one rate, the county can have its own rate, the city its own rate, and potentially even special districts with their own sales tax rates.

That complicates things a lot. For example, if a law required the shown prices to include tax, it would mean that an online website cannot show you the price until you have entered your exact street address. Most people don't want to tell the website where they live just to find out a price that may not be any good.

The variable tax rate means that if the law applied to advertised prices shown on say TV, it would not be possible to have nationwide advertisements that show a price, or even statewide advertisements, or in some cases not even city-wide advertisements. (Unless they set a post-tax price based on what they can sustain with the highest tax rate, which means charging people in lower tax areas a higher price than they would otherwise have charged, just to be able to mention a price at all on TV). Unless the law allowed "between $x and $y depending on your local tax rate" (where X and Y are based on the lowest and highest tax rate for the advertising area).

Most people who want such post tax pricing laws would not be terribly happy with a law that allowed advertising a range like that.

> Unless the law allowed "between $x and $y depending on your local tax rate" (where X and Y are based on the lowest and highest tax rate for the advertising area).

What's wrong with this solution?

Getting rid of sales tax would be the best solution imo but complicated

Very complicated. Getting rid of consumption tax, means income tax is the sole source for citizen taxation.

To replace consumption tax, which ensures those with large savings, yet no income, still get taxed as they spend, you'd have to somehow have full disclosure of all assets, and tax that, along with all the privacy implications.

And just imagine all the work, with every citizen's assets being examined yearly.

Of course, there are other options, but not many which replace consumption tax.

This seems like speculation not based in reality. Do Montana, Alaska, Oregon, Delaware, or New Hampshirite do this?

I don't know. They do still have federal sales tax I presume, and get kickbacks from the federal level for projects?

Some places may also benefit from high property tax, which now that I think of it, is a "holding" tax, not income tax.

There is no federal sales tax. If you go to a store in Delaware there is no sales tax of any kind charged.

Alaska gets a lot of money from natural resources. New Hampshire gets a lot of money from property taxes. They do have sales tax on a few items, but call it something else (I think restaurants and hotels?). I don't know about the other states.

There are many other taxes. There are tariffs, capital gains, or estate taxes, for example.

Additionally, not all consumption taxes are across-the-board sales taxes.

Across-the-board sales taxes are highly regressive taxes, because basic consumption needs are relatively flat across a population, so the poorest people pay a much higher percentage of their income in sales taxes than the wealthy.

Yes, so here, Canada, we tend to make that flat sales tax more complex, so some groceries are excempt, some meals, etc.

Which makes it harder for people to know all the ins and outs of...

> Yes, so here, Canada, we tend to make that flat sales tax more complex, so some groceries are excempt, some meals, etc.

This is also the case in the US (varies state by state).

The way that could be fixed is classifying goods and services into socio-economic class demand (A, B, C+, etc).

Here in Mexico we have something called the "canasta básica" (basic basket) which encompasses a set of goods that are defined as basic for living (they are 40 https://www.gob.mx/canastabasica unfortunately the list is in an image so not easy to google translate... stupid government pages). These are closely guarded by the government and I believe the price is closely protected.

Something like that could be extrapolated, and set different taxes to different goods and services. Like, (IMHO, please don't flame me) an XBOX should be heavily taxed, running shoes should be heavily taxed, a "gaming graphics card" should be heavily taxed. Same with services: "go cart racing" should be heavily taxed, Fast-food should be heavily taxed, while fixing stuff (fixing your blender, or your washing machine) should not.

It gets complicated. In New York, food and clothing is not taxable. The gotcha is “prepared food”, which is taxable.

For example, an unsliced bagel is food. A sliced to order bagel is prepared food and taxable. A system like you describe would be insanely complex.

Here’s NY guidance on when a sandwich is taxable: https://www.tax.ny.gov/pubs_and_bulls/tg_bulletins/st/sandwi...

As insane as that is, I think it makes the sales tax more progressive, as poorer people spend a high proportion of income on food. I am always struck when I travel to a place like South Carolina, where the property taxes are low, but people with nothing are paying 9% sales taxes on food.

I've heard this excuse, that tax situation is too complicated, and never understood it. The store knows to charge me the correct value, including all appropriate taxes, when I come to pay. So the data clearly is there, and therefore choosing not to show it to me up front is indeed bait-and-switch. They're telling me a price that is not going to be what they'll actually charge me.

They aren't charging you sales tax. The governement is, and they force the store into being their tax collector too.

It is a very important distinction.

Are you advocating requiring user registration with an address and login just to view products on an e-commerce site? I would dislike that far more than just knowing my sales tax rate is X% and to factor that in my head. I’d probably do significantly less online shopping if I had to register to see products.

Lots of possible solutions to that though, for unregistered users you could have an option to select sales tax % that would default based on location if you let the site access it. How many different sales tax rates actually exist in the US and how often do they change?

Sure, I agree there are probably some half-useful middle ground solutions.

There are thousands of different sales tax rates in the US that change multiple times per year.

Each city, county, state and other things like metro transit districts, water districts and school districts can all contribute to the sales tax rate paid by an individual at the point of sale.

The answer to both is a lot. It’s not just state level but also county, municipal etc levels. Every month there are dozens and dozens of tax rate changes.

Everyone seems to manage with that just fine. There are literally hundreds of entities providing that service to merchants.

That’s not the topic of discussion though. They currently manage it fine because it’s done at point of sale. How would that work if you have to advertise the price including the sales tax?

> How many different sales tax rates actually exist in the US and how often do they change?

Thousands. Every municipality in my area can have their own sales tax and can change them whenever they want. For Texas alone that's ~1,220 potentially different sales taxes which can change at any time. Its not an impossible to keep track of thing though, plenty of organizations do it and most payment processors will essentially handle it for you. But its not exactly easy, aggregating all that and getting it all right in the first place is a good bit of work.

Sounds crazy but ok!

It’s also a logistics thing. Since we also shop online. Store want online prices to match what’s seen in store and making the two match would be a nightmare and not reasonably viable.

On the other hand thing like cars really should have an all inclusive price sticker. They already have an itemized price sticker on the car so there is really nothing stoping these sellers from putting the remaining fees and taxes on there two as that should be consistent with the same dealer location and with such low inventory.

Given that most stores weren’t printing final price pre-internet, I highly doubt this is the reason. Though I do recall some really small convenience stores not getting the memo, but amongst them it isn’t/wasnt common

If displaying post tax prices is not required by law, then it is usually a competitive disadvantage.

People will see the post tax price, compare it in their head with the pre-tax price they saw at some other store, and feel like the post tax prices store is more expensive even if this store’s final price is actually slightly lower than the other store’s price.

Maybe. But have you ever considered stores that offer pick up vs. dine in options? In Ohio for instance, pick up orders of food of any kind aren't taxed, but dine-in is. So if you're at a fast food restaurant they can't magically change the prices on the menu to include tax just because they now know you're dining in.

Just to add another layer of complexity.

Many landlords and development companies add on percentage based fees. Some merchants will report these on recipes as PIF Tax (Property Improvement Fees). These are not a technically a tax, but impact the consumer the similarly

Even if you are tax exempt or buying non-taxable items like food, the property own still collects PIF.

PIFs are in the contract between the landlord and merchant the actual details of how fees work are not publicly know. Merchants may benefit from actual property improvements, or the fees are entirely a profit stream for the landlord.

I have never seen this- where have you seen it? I know some places pay a % of their sales to their landlord, but I have always seen that included in their advertised price.

I have seen it at a number of places in Colorado. The local supermarket I go to shows 1% PIF tax

With a car it is even more complicated, because the sales tax is based on the county you register it in - not the county that the dealership is in.

>Typically the state will have one rate, the county can have its own rate, the city its own rate, and potentially even special districts with their own sales tax rates.

There's a simple solution to this: stop doing this. Ban cities and districts from having their own sales taxes. There's no reason to allow this. In my country, there's a single national sales tax that's the same everywhere.

The US's problems are a result of its own stupid decisions.

My guess is that your country is much smaller than US (in both population and territory) and what’s more important have strong central government with only minor powers delegated to local authorities. That’s just not US where central government is responsible for fewer things and has strong local authorities that actually responsible for most things that you encounter day to say. (though unfirtunately central gov power is creeping up)

>though unfirtunately central gov power is creeping up

Nothing unfortunate about it: that decentralization is the cause of most of the problems.

In my state if I photograph a wedding and give the client a flash drive of the photos, I need to charge them sales tax on the entire wedding. If I just deliver the photos online, there’s no sales tax.

If they (or a family member) later purchase prints through their online gallery that are essentially drop shipped to them? Who the hell knows.

Stickers in Europe show both pre and post-tax prices. Online sales just charge you with the tax of their origin country. Anyway difficulty to advertise is no reason to not show real prices on in-store stickers.

I live in one of the few states in the US with no sales taxes. It boggles my mind when I go to a store in another state, and buy a $0.99 soda, and the total comes to $1.07. I have also never understood why the price isn't including the tax.

The sales tax rate can change (sometimes from city to city). It is easier to keep track at the register than it is to keep track in the aisles. That's my best guess.

I've always thought that it's probably done to engender anger at the notion of sales taxes by making the difference much clearer than it is in other places where the prices are typically bundled, and to display a lower price than the consumer is expected to pay.

Not displaying the taxes is infuriating when visiting other places, since unless you look up all of the applicable taxes you're effectively just guessing at the cost of anything.

I think originally there may have been some "grumble why do we have to charge" but I feel much of it now is big stores wanting to advertise one price for the whole country as best they can - and "tax licensing and dock fees" is a way to get around the varying prices.

The sales price can change at each store location. It would be even easier to put the full price on the item in the aisle. Stores now know their inventory and track it by the minute.

We had taxes bundled in the price for years in Canada. And it was changed to being separate and added on at the point of sale. The rationale given at the time, was that people should know the actual price of the things they're buying, and how much extra they're paying to support government. Essentially, the argument is that the cost of government shouldn't be invisible.

> Essentially, the argument is that the cost of government shouldn't be invisible.

Brazil went through the same thing, but took the (imo smarter) approach of describing the tax breakdown in the receipt

Everybody describes the tax breakdown in the receipt. The variance between countries is in the menu/catalog price scheme.

The tax breakdown on the receipt is usually because certain people are allowed to reclaim the tax if the goods are used for certain purposes.

Obviously, the be able to reclaim the tax, they need to know how much has been paid on the transaction.

Yes, and it also helps to reduce or prosecute fraud where a merchant charges for a tax that doesn't exist.

I've never seen a receipt for gas that explained how much tax I was paying on the purchase.

And yet that is exactly how gasoline is sold across the country!

Gas prices change very frequently, so almost everyone uses a digital display to show the price... it is much easier to change 3 or 4 prices than to change thousands of labels when the tax changes.

If the argument is that the number of products and consequent ease of updating pricing to include taxes, then there are a huge group of items that should include tax in the quoted price. Admissions tickets to a movie or concert, flight prices, anything digital/online that can be updated immediately like gas prices, vehicles, etc.

In other words, I don’t think that argument holds.

Flight prices are generally displayed all-inclusive in the US.[0]

0: https://www.theflightexpert.com/all-in-ticket-prices-usdot-r...

They should also require stores that have adopted e-Ink price displays to do it

In Australia all prices include GST (equivalent of VAT) but invoices typically show how much the GST component is, which seems to achieve both goals. Plus everyone just knows GST is 10% and applies to almost everything except food and a few essentials. So there's no hiding the cost of government.

Intellectually, I know that you are correct. However, to this day, every time I buy something a bit pricey, the extra charge always feels a bit dear. That contemplation isn't as likely if you haven't already internalized the pre-tax price. So while, we both "know" the cost of government, people who every day have to face those calculations in a very tangible way, probably feel it more acutely.

Perhaps, but why's that an advantage?

For the same reason that being more aware of your personal spending, leads to better personal decisions. Out of sight, out of mind, is a recipe for less oversight and responsibility from decision makers.

Governmental spending can be a huge drag on the economy, and people may not realize just how much, unless they are personally confronted with the true scale of governmental intrusion. Many people today take it all as an unquestionable given, rather than as one choice among many.

Tax is based on the consumer’s address. Technically, the price for you is $0.99.

edit: you can get a refund on the state’s portion of the sales tax, but not the city. (ex. WA state form https://dor.wa.gov/file-pay-taxes/apply-tax-refund/state-sal...).

It is based on where the item is sold if you go to a physical store like in the example.

Technically, it's the place of provision.

So in-store vs delivery, or online event vs in-person, etc.

Most entertaining: where I live, we have to charge the client's tax rate if it's consulting work, but our provincial tax rate if it's hosting.

Which is not necessarily where the car and the window sticker is, if we circle back to the root comment.

So either you’re in Alaska or you’re paying a state income tax on top of your federal income tax. They always get you somewhere!

You can try living/working in Vancouver WA and doing all your shopping in Oregon. But you technically have to report and pay use taxes.

That’s a pretty interesting idea. WA has crazy high car registration fees/tax so if someone wants to optimize this they need to drive a cheap car to decrease the burden

King county does, I’m sure Clark county is more reasonable.

Yeah, that's one of the many benefits of living in New Hampshire. But what boggles my mind is why people in other states are willing to put up with sales tax at all. You're already being taxed on income. Its just the government double-dipping at that point.

Wait you live in a state with state income tax? I’m not sure why you’re willing to put up with that. You’re just being double taxed on your income.

Income tax is progressive; sales tax is regressive.

I know and generally I agree with taxing income for this reason. “Double taxation” is a silly reason.

The double taxation criticism was about sales tax.

I know. Not only is it silly to call it a double tax, it’s also not even correct. Even in NH that money is taxed at least 3 other times before you spend it. Sales tax would be at least the 4th tax on the same money.

Agreed. Especially given the wide range of sales and income tax rates.

That is implementation specific. And oversimplified. An income tax is regressive if you only look within a tax bracket including the highest one which arguably contains the highest level of disparity within it (quantitatively, though perhaps not qualitatively). More so income tax on capital gains. Just the ability to have the majority of your income taxed as gains is regressive. Sales tax that are limited to luxury goods are progressive. Food assistance is often exempted from certain sales tax, which is progressive.

We can make either type of tax regressive, progressive, or vary by income level to push people toward the median lifestyle.

Implementation costs and the ease of avoidance should be larger concerns I think.

In Nevada there's no income tax, some sales tax, but the vast majority of taxable purchases are luxury purchases made by wealthy tourists and there's also a hotel room tax.

So in that one case, choosing sales tax isn't regressive.

* Sales Tax

* Income Tax

* Property Tax

People in all states pay some combo of those 3. Some say no income tax (FL). But that means higher sales tax and property tax. Others have all 3 taxes, but in lower amounts.

Do you really think in New Hampshire you pay less total tax then someone like me, living in the Midwest? You likely do better than NY/Cali, but not the Midwest..

And for all practical purposes your social security is simply a tax as it goes into the exact same bucket as taxes.

True, though that is a federal tax. The 3 taxes I posted - I was referring to state and local level taxes.

Bragging about no sales tax while paying a higher income / property taxes was a pretty funny / American thing to do..

Tax laws are confusing and nonsensical everywhere.

Seems to me for local taxes land-value tax is clearly the most sensible. It aligns the intensives much better.

On state and federal level you can use flat or progressive income tax.

I don't understand why anybody would do sales or value added tax.

But recently I have been thinking if land-value tax for everything just didn't make sense.

So someone lives in a $400,000 RV in an RV park. They won't pay property tax. Say they are living inherieted money. They won't pay income tax. So sales tax would be their only tax.

Obviously this is a cherry picked example and can't represent but .1% of the population. But each lever you pull for tax rewards/punishes a different group. A famous example if FL has no income tax, letting retirees stretch their fixed pensions further.

In general, if a state has a lot of tourists coming to it. They won't get property tax nor income tax on the visitors, but they WILL get sales tax. So it makes sense to raise the sales tax, so that you can lower the property / income tax for people that live there yearround.

The RV park would pay land value tax and that would be financed by the rend of the RV park.

Tourists will make some locations more valuable then others, so it should have an impact on property tax.

We in Ohio also have literally all 3 at the same time.

I'd rather not deal with sales tax, gets annoying sometimes with cash.

Lots of states have no income tax

Nine states have no personal income tax. Of those, South Dakota and Wyoming are the only states that don't have business income taxes. So, only those two states have no income tax.

Sales tax and income tax serve different purposes in most countries. And very little of that purpose is actually "raising" revenue - the federal government can in principle always print whatever money it needs and hand it out to states etc. But they do help ensure the fiat currency has irreplaceable value, that there's not excessive money in the system, and for income taxes also help smooth out inequalities. And it's often simpler or less fraught for state-level taxes to be used to supplement revenue raising rather than rely on federal government hand outs.

The price of the soda is $0.99, so that's the advertised price.

When you negotiate salary with a new employer, do you include the employer paid Social Security and Medicare taxes? Do you say I require $100,000 or $107,650 (Social Security is $6,200, Medicare is $1,450)?

In my experience in casual conversation all Americans say their salary as pre-tax, and in Europe it's more split where many people would say their salary is the post-tax amount.

While I like the idea of having the tax shown on the price tags... tax rates change a lot in most places in the US. The cost to change all the price tags in a store everytime the rate changes, and to do it overnight, would be crazy. Maybe once everyone uses digital eink price labels...

How often are you talking? More often than price fluctuations due to inflation? (fair bit of that recently!)

Price fluctuations aren't usually every item in the store at the same time. Sales taxes change several times a year in my locality.

Wow, that sounds crazy, remind me not to move there.

How on earth is this related to consumer protection? It's not as if they are forcing this retroactively. They're just increasing the price for a car by $1500 and including more functionality.

They are a free enterprise that can offer whichever products at whatever prices they want. And consumers are free to vote with their wallets.

> They're just increasing the price for a car by $1500 and including more functionality

From TFA, they're advertising the vehicle's MSRP without the extra $1500 cost, and that extra $1500 is not optional when you go to actually buy one.

No from TFA they’re breaking it out as a separate line item. We can debate that all you like, but it’s not as if they’re just lying about the cost, or charging people more after the fact.

When you go to sign the dotted line, the price includes this charge. If you don’t like it, don’t sign.

Its frightening how many people think we need the government to regulate the most minute details of everything. Vote with your dollar, period, that is the only way the right feedback gets to the right issues.

It's hard to vote with your dollar if the company can lie to you about the price. Sure in this case you'll find out the actual cost eventually but at a point where changing your vote is much harder (maybe a deposit has already been collected, credit check run, the other car you were considering has been sold etc)

So are they lying or will you eventually find out the cost?

Buying a car is not the hardest feat by any stretch imaginable. If you’ve put down a deposit, you will have seen the all in cost. If you don’t like it, don’t buy it.

> So are they lying or will you eventually find out the cost?

Yes.

This is the kind of deception that starts early on in the process to get you to narrow down your car selection by deceiving you on the actual price of the car.

> Buying a car is not the hardest feat by any stretch imaginable. If you’ve put down a deposit, you will have seen the all in cost. If you don’t like it, don’t buy it.

It's not hard, but it's definitely not pleasant, and the the auto makers and dealers can do some slimy practices. The parent comment I was replying to seemed to conflate auto makers should not be allowed to advertise an inaccurate MSRP with over-regulation. Also you are not 100% correct about deposits, just ask Bronco reservation holders who put down deposits with dealers for reservations, that later got turned into orders, that when the car arrived had thousands of dollars of surprise "ADM" (Additional Dealer Markup in Ford lingo) added to the buy sheet.

Rent seeking happens precisely because voting with your dollar doesn't work well. "Vote with your dollar" is a platitude based on an oversimplified model of the economy.

"The price shown should be the price paid" is not a "minute detail" it's like the fundamental basis of advertising.

What's frightening is how many people believe in the myth of the free market of rational consumers.

Is the cost of living in your country, on average, higher or lower than in the United States?

As far as I can tell there are a vanishingly small number of problems where "new laws" are the optimal answer. Increased regulatory oversight generally leads to ossified markets with higher costs. Many of the most reviled monopolies throughout American history got there in no small measure because of government protection in the form of "regulation".

In this case, there are multiple car manufacturers available to Americans from around the world - if this makes GM vehicles more expensive or causes a consumer backlash that damages sales, GM will change their behaviour. That seems like a more responsive mechanism than piling on new regulation to dictate which types of fees are okay and which aren't.

> Many of the most reviled monopolies throughout American history got there in no small measure because of government protection in the form of "regulation".

This is simply not true. The common reviled monopoly strategies include price fixing, collusion, natural monopolies, markets with high barriers to entry, network effects, and others in addition to regulatory capture. Regulations that contribute to monopolistic tendencies are "vanishingly small" in number, you just hear about them a lot because people don't like them.

> if this makes GM vehicles more expensive or causes a consumer backlash that damages sales, GM will change their behaviour.

It may be time to walk through history and see all the dark patterns that were solved by regulation. Before the EPA, it was common for manufacturing companies to dump industrial waste directly into rivers, for example.

Consumers only have so much energy for backlash, and your theoretical system requires everyone to have an encyclopedic memory of all the shitty things that every company does and weigh all of that in their minds when making consumer choices. It's impractical and impossible. Regulatory agencies are a much better system and that's why every modern economy depends on them.

I’d add that recent deregulation (energy markets) & pre-regulation (like cryptocurrency) show that companies are remarkably fast & consistent in enacting proven, exploitive models.

The idea that regulation is a burden on society is fanciful. What is burdensome is regulations that cannot be readily adapted. Unfortunately, popular myths like “regulation bad” is part of the reason regulators stay with policies they would much rather propose updating. Veteran regulators are quite eager to improve their frameworks. It is “politics” that prevents their evolution.

> Consumers only have so much energy for backlash, and your theoretical system requires everyone to have an encyclopedic memory of all the shitty things that every company does and weigh all of that in their minds when making consumer choices.

Hey, uh, there's this thing called Google - most people start there when they're making a big-ticket purchase like a car. Or you could pay for Consumer Reports to get expert-level analysis. Or you can just ask people on the relevant subreddit.

Consumers have access to more information to inform buying decisions than at any point in history. So unless General Motors is the only car manufacturer in the world, people can weigh the pros and cons and make their own decisions. More intervention from government is totally unnecessary and likely even harmful in the form of generally higher prices.

> That seems like a more responsive mechanism

It clearly isn't. The power and knowledge asymmetry between producers and consumers is such that most producers can get away with abhorrent behaviour pretty much all the time with no significant repercussions. That's why boycotts don't work, among other things.

While I agree this would be ideal, actual prices on cars actually wouldn't be possible in the US. For many (most?) states, for cars/trucks, you pay sales tax based on where you LIVE not where you purchased the car so the price would be different per buyer.

Also, for most cars, paying sticker would be a rip off anyway. Unless there is a shortage going on, no one expects to pay sticker price.

> (slightly off topic, but in my country consumer laws also mandate that sticker and advertised prices must be the final price including all taxes. The standard USA practice of stickers/adverts with pre-tax price is also absurdly anti-consumer).

How does that work when advertising in media that is available in more than one country, such as broadcasts of major international sporting events?

Where do you live and is Apple's bundling of iCloud (you can only use some major features like the App Store when signed in & you can't choose other providers to fullfil the same role) illegal there too?

They haven't specifally addressed App Store + iCloud bundling...

Because they have been specifically targeting iPhone + App Store bundling: https://www.theverge.com/2022/3/25/22996248/apple-sideloadin...

The US has antitrust law prohibiting bundling as well.

> The USA really needs better consumer protection laws.

I feel like we used to. Everything is so overtly nickle and dime the working class now.

Completely agree. A related question would be how does lobbying work in your country?

The practice of not including sales taxes allows the government to raise sales tax without it impacting the inflation charts, and citizens recognizing the full impact to their wallet.

Government gets more money this way

Why, then, do most US states have such laughably low sales tax rates, compared to e.g. the EU?

Because most US states also have income tax.

That's not it. EU countries have income tax.

As does the EU. So that doesn't explain it.

I don’t agree with the person you replied to but the answer to your question is:

Because the US collects taxes very differently, so you can never make a fair comparison between identical tax categories.

Just look at the gasoline tax differences between the two. The core purpose of that tax and what it’s used to fund varies dramatically between the two regions. So, naturally the amount being taxed would be different.

Also, The US govt tends to have taxes below the rates needed to operate (US has a higher deficit), so the taxes will more likely be lower by comparison.

And a side note, as many EU residents constantly remind us in North America.

We drive greater distances here. More rural miles. More highway miles.

Rural driving (constant 50mph with no stop and start of lights for an hour or more), is far less damaging to roads than start and stop traffic. Interstate miles are the same concept.

Beyond that, expanding and building roads, is cheaper in rural areas.

So there may actually be more gas tax collected per repair cost, even with the rate lower in the US.

Canada has higher gas tax than the US, but lower than the EU. But we also have cold weather everywhere, with frost and ice destroying roads.

So on average, we need more than the US, which only has a few northern/cold states.

You're trading programs for taxes. All those free benefits of society have to get money from somewhere.

It’s more that we shift where things are taxed (lower sales taxes are made up for with higher property taxes, etc.). Americans pay similar amounts to Europeans when you look at taxes + health insurance but we get less because of politically-mandated inefficiency.

Source for similar amounts? Median disposable income is way higher in the US.

It depends on what you’re measuring and especially what income levels but https://www.theatlantic.com/business/archive/2013/04/the-myt... gives you the general idea of what to look for.

In general, Americans pay less in total taxes but we give that back with much greater expenses for things like healthcare & drug costs, retirement, education, etc. At the top end that works out in your favor but there’s no equivalent for things like our rates of medical bankruptcy for everyone below the highest income levels.

But the USA is #10 in the world in welfare spending per capita. Even beating out a few countries commonly called "welfare states" like the UK.

https://en.wikipedia.org/wiki/List_of_countries_by_social_we...

The EU doesn't have a sales tax. They have a VAT which is a tax on net income not sales.

From the point of view of the consumer what's the difference? An item that is listed for price P online in the US costs a US buyer P x (1 + s) where s is the sales tax rate and costs an EU buyer P x (1 + v) where v is the VAT rate.

As far as I can see the differences are in what happens on the retailer's supply side. In the US generally there won't be sales tax on the supplier's sale of goods to the retailer. In the EU there might be VAT on those, but the retailer might get to deduct the VAT they pay when they are remitting the VAT they collect.

The net result in both systems is that the consumer pays all of the sales tax or VAT. In the US system the government doesn't see any of that until the final sale to the consumer. In the EU, entities up the supply chain pay part of it but get it back later via deductions so in effect VAT for those entities is a loan to the government which the government pays back from the VAT consumers pay.

For the consumer not much difference. For comparing tax levels it makes a big difference. VAT is a tax on all the steps in the manufacturing & sales process. Sales tax is a tax on the last step alone.

Reply on news.ycombinator.com