Access

You are not currently logged in.

Access your personal account or get JSTOR access through your library or other institution:

login

Log in to your personal account or through your institution.

If You Use a Screen Reader

This content is available through Read Online (Free) program, which relies on page scans. Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.

Excise and Sales Taxes as Anti-Inflationary Measures

John F. Due
The Annals of the American Academy of Political and Social Science
Vol. 326, Inflation (Nov., 1959), pp. 79-84
Stable URL: http://www.jstor.org/stable/1033353
Page Count: 6
  • Read Online (Free)
  • Download ($40.00)
  • Subscribe ($19.50)
  • Cite this Item
Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
Excise and Sales Taxes as Anti-Inflationary Measures
Preview not available

Abstract

Sales and excise taxes are in all likelihood typically shifted forward in the form of higher commodity prices. Their anti-inflationary influence arises from their effect in reducing real purchasing power by raising commodity prices relative to factor incomes. Unlike other price increases, this type does not have a spiraling effect because it does not generate additional income. Sales and excises have some relative advantage over income taxes so far as inflation control is concerned. They place a heavier relative burden on persons spending high percentages of their incomes and compel them to reduce consumption. They give some incentive to spend less and save more. In addition some persons may tend to spend the same dollar sum, including tax elements, as before. If persons attempt to maintain their old consumption levels of goods and services, they increase their tax liability by so doing. On the other hand, much of the greater anti-inflationary advantage of the sales and excise taxes will be lost if they generate wage increases. The sales and excise taxes may also offer some limited advantage from the standpoint of production incentives, but this can easily be exaggerated. The principal objections to the sales and excise taxes are equity ones; the levies conform much less closely with accepted standards of equity in taxation than the income tax. Sales and excise taxes, as well as the income tax, are greatly inferior to the expenditure tax as anti-inflationary measures, and the latter is more equitable than the commodity taxes.

Page Thumbnails

  • Thumbnail: Page 
79
    79
  • Thumbnail: Page 
80
    80
  • Thumbnail: Page 
81
    81
  • Thumbnail: Page 
82
    82
  • Thumbnail: Page 
83
    83
  • Thumbnail: Page 
84
    84