Tax Mysteries Uncovered! (part 2 of Why Some People Pay More Taxes…)
In part 1 I started to explore how a business owner benefits more than an employee from public roads. Let’s go a little further with this simplified example.
We’ve already seen that an employee benefits from public roads in that he or she can get to work to earn some money. The business owner gets the same benefit from his trip, plus the benefit of the worker coming to work to do something of value to the business.
But let’s look at other uses of roads by the business. We have already said that the business in this example is “old-fashioned” in that it actually makes something, in the U.S.A., and without the aid of robots or too much automation. Then the business sells its product to either consumers or retailers. How does the business get its products to buyers? Most likely in trucks.
These trucks use the same roads that we all drive on and pay for through our taxes. So this use is a benefit for the business and the business should pay its “fair share” for the construction and maintenance of the roads.
But it’s even bigger than that. Trucks loaded with cargo cause exponentially more damage and simple wear-and-tear on roads than do passenger cars – even big SUVs. Because of this, roads have to be built much thicker and stronger in the first place, but they must also be re-paved, have potholes and cracks fixed, etc. much more often.
The result is a situation that mirrors the discussion in part 1: both the business owner and the worker use the roads to go to the store to buy things. But the business uses the roads to make a profit. Once again, the imperative is simple: Pay for what you get!
Okay, we’ve mostly talked about businesses so far. In part 3 I’ll start looking into individual benefits from the things that taxes pay for. Again, this is not to say that some people are “bad” and therefore need to pay more taxes. It’s simply based on the same principle we all observe every day: Want two donuts instead of one? Pay for two. Want a Fat Tire instead of a Coors? Fat Tire is better (6,428 times better, by my calculations) and it costs more – if you want it, you have to pay for it.
Tom Rossi is a commentator on politics and social issues. He is a Ph.D. student in International Sustainable Development, concentrating in natural resource and economic policy. Tom greatly enjoys a hearty debate, especially over a hearty pint of Guinness.
Tom also posts on thrustblog.blogspot.com