With Hucabee in the presidential race suggesting that we should move from an income tax to a consumption tax I wondered what the best basis for taxation is and why. After all, any tax is punitive and tends to reduce the thing taxed. So under a consumption tax people will tend to consume less and save more. I'm not clear how that would impact the economy.
So what do you think, what is the best basis of taxation and why?
Labor (income tax)
Wealth (property tax)
Consumption (sales tax)