Double Dipping and Sales Tax
Posted by Sheri Harris on Sunday, July 18, 2010
American's are spending more money on tax in amounts that have caused consumers to purchase fewer items. State tax must also be paid in many states regarding income tax filing. It certainly seems that the state has indulged in "double dipping", resulting from sales tax paid at tax time and the taxes that are paid when items are purchased.
ARGUMENT
Double dipping occurs once the state imposes a manditory tax upon people for items ie. soda, alcohol, cigarettes and almost everything purchased. Therefore, people have paid a large percentage of sales tax to the state for items purchased and they again must pay an additional tax at tax time.
With economic times still a strain for many ordinary citizens the double dipping of tax payment makes a big difference to those who have a limited amount of money to shop with.
AGENDA
Residents who are subject to state tax should be "pre-taxed" during each pay check the individual recieves. The gross income for the state is calculated after the "pre-tax" has been deducted. This should be done so that no payment is due to the state at tax time. With a set pre-taxed amount deducted, gross income for the state is determined afterwards of deduction. This would offset the "double dipping" taxation for taxpayers because the tax has already been paid and since it must be deducted from your gross income; your actual gross income is tabulated after the sales tax deduction. Therefore, the benefit of that deduction places you in a lower tax bracket meaning the taxes you will pay are less. The taxation rate would be appx. .0250% per every $15,000 earned. For example person A has a gross check income of $801.00 with the new pretax of $1.00 for every paycheck. When deducted person A's actual gross income is $800.00 This will have an accumulative impact at tax time which persons are able to benefit because they are put into a lower tax bracket by the end of the year, because they are taxed on the yearly total gross amount after the deductions and not before. Or on a state form at tax time - you just list your gross income and then minus or deduct the amount you paid in state sales taxes or "pre taxes", that amount is now your new yearly gross income on your state income tax form and is the lesser amount you will pay taxes on.
CONCLUSION
Double dipping would be eliminated because your gross income is actually determined after sales taxes are deducted. Since the amount of tax payment is deducted from your gross income this therefore places one in a lower tax bracket which is a sales tax incentive.
Dated: July 17, 2010 Attest: A. Sadiq
On Behalf of Pieces
ARGUMENT
Double dipping occurs once the state imposes a manditory tax upon people for items ie. soda, alcohol, cigarettes and almost everything purchased. Therefore, people have paid a large percentage of sales tax to the state for items purchased and they again must pay an additional tax at tax time.
With economic times still a strain for many ordinary citizens the double dipping of tax payment makes a big difference to those who have a limited amount of money to shop with.
AGENDA
Residents who are subject to state tax should be "pre-taxed" during each pay check the individual recieves. The gross income for the state is calculated after the "pre-tax" has been deducted. This should be done so that no payment is due to the state at tax time. With a set pre-taxed amount deducted, gross income for the state is determined afterwards of deduction. This would offset the "double dipping" taxation for taxpayers because the tax has already been paid and since it must be deducted from your gross income; your actual gross income is tabulated after the sales tax deduction. Therefore, the benefit of that deduction places you in a lower tax bracket meaning the taxes you will pay are less. The taxation rate would be appx. .0250% per every $15,000 earned. For example person A has a gross check income of $801.00 with the new pretax of $1.00 for every paycheck. When deducted person A's actual gross income is $800.00 This will have an accumulative impact at tax time which persons are able to benefit because they are put into a lower tax bracket by the end of the year, because they are taxed on the yearly total gross amount after the deductions and not before. Or on a state form at tax time - you just list your gross income and then minus or deduct the amount you paid in state sales taxes or "pre taxes", that amount is now your new yearly gross income on your state income tax form and is the lesser amount you will pay taxes on.
CONCLUSION
Double dipping would be eliminated because your gross income is actually determined after sales taxes are deducted. Since the amount of tax payment is deducted from your gross income this therefore places one in a lower tax bracket which is a sales tax incentive.
Dated: July 17, 2010 Attest: A. Sadiq
On Behalf of Pieces