[ale] OT fairtax isn't

Sean Kilpatrick drifter at oppositelock.org
Fri Mar 16 21:11:50 EDT 2007


On Friday 16 March 2007 20:38, Byron A Jeff wrote:
|  For example take a 35% external tax rate. So if you spend
| $1 on a good, then you pay $0.35 in tax. The embedded tax rate would
| be $1 including tax. But the amount spent on the good if the good+tax = $1
| is $0.74. So $0.74 goes for the good and $0.26 on the tax. Since you spent
| $1 and paied $0.26 in tax, they call that tax rate a 26% rate. 
| 

That's interesting math. Not correct, but interesting.

If an item costs $74 and the tax is $26, then the total paid is $100.
The tax rate on the transaction is 35.1%, _not_ 26%

Sean

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