Tax targets

We have to tax something. Here are some things where taxation would do little harm:

Carbon
Tobacco
Alcohol
Cannabis
Legacies
Tax haven income stashed offshore (all of it now).  Much of this income is not really foreign anyway, and comes from U.S. intangibles.  A mandatory deemed repatriation — saying “tax is due now” — would bring in hundreds of billions.  Taxing it at some reduced rate, as many suggest as a compromised, is a pure give-away.  At worst, spread the deemed repatriation over a couple of years.

Here’s our actual list:

Income
Payrolls
Tobacco
Alcohol
Gambling — via state monopoly:  states are getting what they think the market will bear.
Legacies – inheritances – are taxed only marginally today, thanks to a $5 million threshold ($10 million for couples) and gaping loopholes.

The income tax has been regulatorily captured.  A keen observer speculates that Donald Trump won’t release his income tax returns because he hasn’t paid any.  Taxing payrolls is justified by history, and practicality, but it nudges in an unfortunate direction.