1990 Luxury Tax Failure

http://www.nytimes.com/1992/02/07/business/falling-tax-would-lift-all-yachts.html

Interesting that Obama is now wanting to stick it to those buying private jets. Is this intended to stoke wealth envy or sound policy?

Having a seperate tax for a specific type of luxury good seems unneccarily complex to me, and doesn't appear to accomplish much. Rather, the government ought to increase the income tax the wealthy pay, a simple measure which requires little bureaucracy.

I agree with KN's point (let's assume for a moment that we agree on increasing the tax burden on very high income people).

Except in the case where the private cost of the consumption good is not meaningfully embedding a large social cost, raising taxes on a specific behavior is unnecessarily distortionary. It also requires the government to make a moralistic judgement call that I'm not comfortable with them doing.

Originally posted by KazetNagorra
Having a seperate tax for a specific type of luxury good seems unneccarily complex to me, and doesn't appear to accomplish much. Rather, the government ought to increase the income tax the wealthy pay, a simple measure which requires little bureaucracy.

Originally posted by techsouth
So you would say "yes, Obama is stoking wealth envy"?