Comment by hiworld6543
3 hours ago
Percentage increases are the result of your money being worth less. That’s why every good government fights inflation. Stable values of money make it easier to plan budgets, estimate costs, lure investors, and collect taxes.
It’s when the value of money decreases that government has to choose among reducing spending (often by reducing services), increasing tax rates, and electoral losses. Most choose incremental tax rate increases because it’s easiest and the people likely to complain are unwilling to run for office to replace the people who raised the taxes.
Not arguing that sequence of thought doesn't occur, but it bothers me because the reasoning is faulty. If money's worth less, then the appraised value of my home measured in dollars should correspondingly increase. If the biggest taxes are assessed as rates on things that tend to scale with inflation, then it ought to be relatively indifferent to inflation. The only changes you should have to make to your tax system in response to inflation should be raising flat rate taxes.