A brief lesson on the “regressive” effects of a sales tax (and other ‘regressive’ taxation techniques which lead to poorer people paying higher percentage of incomes in taxes than those more fortunate in America:

A lesson on Regressive taxation brought to you by several anonymous contributors at Wikipedia (see whole article here), the world’s leading collaborative encyclopedia:

“A regressive tax is a tax imposed in such a manner that the effective tax rate decreases as the amount subject to taxation increases.[1][2][3][4] In simple terms, it imposes a greater burden (relative to resources) on the poor than on the rich. “Regressive” describes a distribution effect on income or expenditure, refering to the way the rate progresses from high to low. It can be applied to individual taxes or to a tax system as a whole; a year, multi-year, or lifetime. Regressive taxes attempt to reduce the tax incidence of people with higher ability-to-pay, as they shift the incidence disproportionately to those with lower ability-to-pay.

A simplified illustration of a regressive tax on income (proportional on consumption) is as follows: If Jane has $10 and John has $5, a tax of $1 on a purchase would result in a different percentage of total income applied to taxation, 20% for John and 10% for Jane. Thus, a tax that is fixed to the value of the good/service (as with sales tax)(without exemptions or rebates) would likely, in effect, result in a higher burden of taxation to people with less money (depending on consumption level and timeline examined – year or lifetime).

The opposite of a regressive tax is a progressive tax, where the tax rate increases as the amount subject to taxation increases.[5][6][7][8] In between is a proportional tax, where the tax rate is fixed as the amount subject to taxation increases.

The term is frequently applied in reference to fixed taxes, where every person has to pay the same amount of money. The regressivity of a particular tax often depends on the propensity of the tax payers to engage in the taxed activity relative to their income. In other words, if the activity being taxed is more likely to be carried out by the poor and less likely to be carried out by the rich, then the tax may be considered regressive. To determine whether a tax is regressive, the income-elasticity of the good being taxed as well as the income-substitution effect must be considered.

A simplified illustration of a regressive tax on income (proportional on consumption) is as follows: If Jane has $10 and John has $5, a tax of $1 on a purchase would result in a different percentage of total income applied to taxation, 20% for John and 10% for Jane. Thus, a tax that is fixed to the value of the good/service (as with sales tax)(without exemptions or rebates) would likely, in effect, result in a higher burden of taxation to people with less money (depending on consumption level and timeline examined – year or lifetime).

A regressive tax system does not mean and likely would not result in low income earners paying more taxes than the wealthy, only that the effective tax rate relative to income or consumption would be a larger tax burden to low income earners.”

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“Hyper Milers” claim to get 100+miles per gallon out of contemporary hybrids (in USA Today article today.)

100 mpg? For ‘hypermilers,’ that sounds about right

…Saw this article in USA Today today (click here to read whole article), thought it was interesting and with $4.00+ per gallon gas(current US avg. price is $4.072/gal. according to AAA), we could all use a few gas saving tips…

an excerpt:

“…After a 29-mile jaunt from his Phoenix office to his home here, Louis Hudgin proclaimed his gas mileage “pitiful.” He averaged just 88.3 miles per gallon (in a 2000 Honda Insight Hybrid)…Hudgin’s disappointment – he usually averages about 100 mpg this time of year…He’s a hypermiler, part of a loose-knit legion of commuters who’ve made racking up seemingly unatainable mpg an art. And a Sport…”

Some “Hypermiler” websites for us to explore:

CleanMPG.com, Greenhybrid.com, Hypermiling.com, 100 Tips to save gas

Connecticut General Assembly overrides Governor’s minimum wage increase veto

The following was published at Courant.com, in the Hartford Courant:

HARTFORD, Conn. – With two votes to spare, the Democrat-controlled state legislature voted Monday to override Gov. M. Jodi Rell’s veto of a minimum wage increase.

It marked the second time that the General Assembly has overturned one of the Republican governor’s vetoes.

The override will ensure that the current minimum hourly wage of $7.65 an hour is boosted to $8 beginning in January, and to $8.25 an hour in 2010. The change will make Connecticut’s minimum wage among the nation’s highest.

“It’s a simple matter of equity,” said Senate Majority Leader Martin Looney, D-New Haven, saying low-wage workers need the $14 weekly increase as gasoline and food prices are increasing.

House members needed a two-thirds majority – at least 101 votes – to override the veto. The final tally was 102-39.

The Senate’s vote was 25-9, a one-vote margin above the minimum 24 votes needed for the override. Both votes were mostly along party lines.

According to the U.S. Department of Labor, Washington currently has the highest minimum wage rate, at $8.07 an hour. Of Connecticut’s neighbors, the minimum wage is $8 in Massachusetts, $7.40 in Rhode Island and $7.15 in New York.

An estimated 65,000 workers in the state receive the minimum wage.

Rell, who supported past minimum wage increases, called Monday’s veto override “a seriously shortsighted decision” that will hurt small businesses during a difficult economic period.

“Even as the national economic picture continues to darken, the legislature has opted to further cloud Connecticut’s business environment,” she said.

Most of Rell’s GOP colleagues agreed.

“Please, before you cast your vote on this bill, think about what you’re doing,” pleaded state Rep. Anthony D’Amelio, R-Waterbury, who also owns a small business. “What you’re doing actually is hurting the people you’re trying to help.”

D’Amelio predicted that businesses will cut workers’ hours to cover the pay increase.

Some Democrats called the Republicans’ concerns a red herring. Senate President Donald Williams, D-Brooklyn, said similar dire predictions were made when lawmakers increased the wage in the past, but they never came true.

Sister Teresa Fonti, co-director of the House of Bread soup kitchen in Hartford, said she’s seeing more poor people with jobs seeking assistance.

“Obviously, this salary is not getting them through the week,” she said.

Democratic leaders initially were unsure how many legislators would attend Monday’s veto session because of summer vacations and work schedules.