One of the biggest, and one of the oldest, taxes in this latter sense is inflation. If you define a tax as only those things that the government chooses to call a tax, you get a radically different picture from what you get when you say, “If it looks like a tax, acts like a tax and takes away your resources like a tax, then it’s a tax.” While it is true that nearly half the households in the country pay no income tax at all, the apparently simple word “tax” has many complications that can be a challenge for even professional economists to untangle. Yet the marginal tax rate on someone living in poverty can sometimes be higher than the marginal tax rate on millionaires.
With all the talk about taxing the rich, we hear very little talk about taxing the poor.
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