Introduction
The local, state and federal governments are the decision makers in the redistribution, provision and taxation of public goods. Understanding the regulation and restrictions is a major part of knowing how to correctly handle each facet of the United States Government. A struggle that the governments are having at this time is whether to tax the internet. The internet is a public good provided to the masses. The government has been trying to devise a structure to levy taxes on our purchases of products over the internet.
The purpose of this essay is to discuss tax levies, tax affect on supply and demand, and various other situational questions.
Tax Levy
A question asked was, “Is the tax levied on the producers or consumers”? The answer is that both the producers of goods and the consumers who buy their products have a tax levied on them. Therefore, there is a double tax situation going on here, however, the government standardized the levy this way know the double taxation would occur maximizing the potential of the governments financials. The author states, “It should be recognized that any tax levied directly on a business will ultimately be paid by real, live people–if not consumers via higher prices, then business owners via reduced profits or employees via reduced wages. In the first instance, the tax is considered to be shifted "forward," and in the second and third instances it is considered to be shifted "backward" to the factors of production. (Taxes may also be exported out of state, thereby relieving the burden in state. Of course, other states’ taxes may end up being imported into Texas as well.) In any case, or in any combination where the tax burden is borne jointly, the old cliché is true: Only people pay taxes” (Combs, 2007). We w ...