Coincidence? I Think Not!

[Denny Crane]

Workers compensation insurance is not funded by payroll tax (or any other tax) and employees never pay a dime for it. It's just like any other insurance and is funded by insurance premium paid by business owners (at least it's that way in Oregon, not sure about other states).

My bad. I meant unemployment insurance.

 

[Denny Crane]

Those that are mandated by the government are.

How about paying a toll to cross a bridge? That's mandated by the government. How about tuition to go to a government school? How about a speeding ticket?

It's not as clear as you're trying to make it out to be.

 

[Minstrel]

How about paying a toll to cross a bridge? That's mandated by the government. How about tuition to go to a government school? How about a speeding ticket?

It's not as clear as you're trying to make it out to be.

None of those are examples of the government mandating that society pay in for the good of society. The first two examples are examples of pay-per-usage (you can choose not to travel over the bridge or attend the public university and then you won't pay anything) and the third is a punishment. Similarly, buying stamps is not a tax.

I think it's pretty cut-and-dry. When the government requires that you pay money that is then distributed back to the society in the form of goods/services, it's a tax. When it offers something you can choose to buy/pay for, it isn't a tax.

 

[Denny Crane]

None of those are examples of the government mandating that society pay in for the good of society. The first two examples are examples of pay-per-usage (you can choose not to travel over the bridge or attend the public university and then you won't pay anything) and the third is a punishment. Similarly, buying stamps is not a tax.

I think it's pretty cut-and-dry. When the government requires that you pay money that is then distributed back to the society in the form of goods/services, it's a tax. When it offers something you can choose to buy/pay for, it isn't a tax.

I think it's cut and dry that when the govt. charges a flat (rate) fee and puts the money in a fund and manages the fund like any insurance fund, it's not a tax situation.

You describe a tax in general terms, which is a good definition. Govt. charges taxes and uses them for the benefit of society. The definition here is the govt. takes a fee and manages the money as any insurance company or pension plan does with a similar collection of money. It's not used for the benefit of society, but for the payment of benefits specific to the program.

 

[MARIS61]

All this tricky tax talk is taxing my train of thought.

Let's tactfully change tactics and take a different tack by attacking tax evaders for their taciturnity.

 

[BoBoBREWSKI]

All this tricky tax talk is taxing my train of thought.

Let's tactfully change tactics and take a different tack by attacking tax evaders for their taciturnity.

repped!

 

[Minstrel]

It's not used for the benefit of society, but for the payment of benefits specific to the program.

Benefits specific to the program that society deemed beneficial for society. Every tax can be rephrased as a "fee," and you really haven't shown how payroll taxes are conceptually different from any other tax. All you've said is that they are earmarked to fund specific programs rather than thrown into a general purse, which isn't contradictory to the concept of a tax. Some taxes can be used generally, some can't.

 

[Denny Crane]

Benefits specific to the program that society deemed beneficial for society. Every tax can be rephrased as a "fee," and you really haven't shown how payroll taxes are conceptually different from any other tax. All you've said is that they are earmarked to fund specific programs rather than thrown into a general purse, which isn't contradictory to the concept of a tax. Some taxes can be used generally, some can't.

Except you pay money in and you get money out, like an annuity. It's exactly not like what you describe, going into a general purse.

Is the lottery a tax?

 

[Minstrel]

Except you pay money in and you get money out, like an annuity. It's exactly not like what you describe, going into a general purse.

I expressly said taxes don't have to go into a general purse. Taxes can be earmarked for specific programs. That's nothing new or controversial.

Is the lottery a tax?

No, because you can choose to buy a lottery ticket. Since you seem to have already forgotten what I said, I'll repost it:

I think it's pretty cut-and-dry. When the government requires that you pay money that is then distributed back to the society in the form of goods/services, it's a tax. When it offers something you can choose to buy/pay for, it isn't a tax.

 

[Denny Crane]

Because you say so.

Your definitions are arbitrary.

 

[Minstrel]

Because you say so.

Your definitions are arbitrary.

Dictionary definition of a tax: a sum of money demanded by a government for its support or for specific facilities or services, levied upon incomes, property, sales, etc.

Nothing in that says that if it's earmarked for a specific program, it stops being a tax. In fact, it refers to both the general fund (for its support) and for specific programs (or for specific facilities or services).

 

[Denny Crane]

Dictionary definition of a tax: a sum of money demanded by a government for its support or for specific facilities or services, levied upon incomes, property, sales, etc.

Nothing in that says that if it's earmarked for a specific program, it stops being a tax. In fact, it refers to both the general fund (for its support) and for specific programs (or for specific facilities or services).

It isn't earmarked for specific services or facilities. It's something like a 401K where your employer withholds the desired amount and pays it to some trust fund manager. In the case of social security, the manager is the social security administration.

You need to look at the initial act and also consider why the government's books show this as "off budget" unlike, say, the highway trust fund.

 

[Minstrel]

It isn't earmarked for specific services or facilities. It's something like a 401K where your employer withholds the desired amount and pays it to some trust fund manager. In the case of social security, the manager is the social security administration.

Unlike a 401(k), it's neither optional nor paid directly back to the person paying it. The money paid now goes to seniors now. You get money in future, when you are old enough to qualify, from people paying in at that point (theoretically). This is why conservatives detest social security...its not a personal trust, but a tax to redistribute wealth (mostly for the benefit of poor seniors, but obviously all seniors can get it, even rich ones).

If it were an optional trust that was held and invested just for you, I'd agree that it wasn't a tax.

 

[Denny Crane]

Unlike a 401(k), it's neither optional nor paid directly back to the person paying it. The money paid now goes to seniors now. You get money in future, when you are old enough to qualify, from people paying in at that point (theoretically). This is why conservatives detest social security...its not a personal trust, but a tax to redistribute wealth (mostly for the benefit of poor seniors, but obviously all seniors can get it, even rich ones).

If it were an optional trust that was held and invested just for you, I'd agree that it wasn't a tax.

It may seem like a redistribution to you, but it's really a ponzi scheme. That's where the crook sells stock (shares in SS) to new investors to pay off the previous round (generation).

Anyhow, it is like a 401K because you get paid out in proportion to what you paid in.

You failed. To address the off budget thing.

 

[Minstrel]

It may seem like a redistribution to you, but it's really a ponzi scheme.

It's very literally and inarguably redistribution. It's taking money from wage-earners and providing it to largely fixed-income people. The people receiving the money are not the ones who paid it in.

Whether it is also a ponzi scheme is up to opinion, but even if it were, it wouldn't contradict the fact that it is redistribution.

Anyhow, it is like a 401K because you get paid out in proportion to what you paid in.

That's cool. And a bird is similar to an elephant in that both depend on oxygen. That doesn't make a bird an elephant, and the similarity you note doesn't make a payroll tax a 401(k).

You failed. To address the off budget thing.

I did indeed fail to address that because it was a non sequitur. I've yet to see anyone define a tax based on how the government accounts for it in the books. Well, other than you. I've seen many people define taxes as I do, including dictionaries.

 

[Denny Crane]

Fail twice now.

http://en.wikipedia.org/wiki/Tax

The legal definition and the economic definition of taxes differ in that economists do not consider many transfers to governments to be taxes. For example, some transfers to the public sector are comparable to prices. Examples include tuition at public universities and fees for utilities provided by local governments. Governments also obtain resources by creating money (e.g., printing bills and minting coins), through voluntary gifts (e.g., contributions to public universities and museums), by imposing penalties (e.g., traffic fines), by borrowing, and by confiscating wealth. From the view of economists, a tax is a non-penal, yet compulsory transfer of resources from the private to the public sector levied on a basis of predetermined criteria and without reference to specific benefit received.

 

[Minstrel]

From the view of economists, a tax is a non-penal, yet compulsory transfer of resources from the private to the public sector levied on a basis of predetermined criteria and without reference to specific benefit received.

So by your interpretation of that, a highway tax isn't a tax because it references a specific benefit.

 

[Denny Crane]

So by your interpretation of that, a highway tax isn't a tax because it references a specific benefit.

Highway tax isn't a tax. There's a trust fund for it, too.

 

[Minstrel]

Highway tax isn't a tax. There's a trust fund for it, too.

Fascinating take. Pretty minority, potentially minority of one.

Anyway, since you accept Wikipedia as a good source, witness as it betrays you:

http://en.wikipedia.org/wiki/Payroll_tax#In_the_United_States

Run-down of payroll taxes in the US. Hits on individual components of the tax, like social security and Medicares taxes (you can get a tax credit if you pay too much in Social Security taxes) and unemployment insurance taxes.

So, if you still think it's not a tax, we'll have to agree to disagree. I'll stick with the widely-held conception of taxation.

 

[Denny Crane]

If Social Security withholding were a tax, it would have been cut during the Bush years, the Reagan years, etc.