Archive fortaxes

http://www.forbes.com/sites/chuckjones/2016/11/17/one-overlooked-reason-trump-shouldnt-impose-tariffs-on-china/#5c7dd1032802

This article talks about why tariff on China’s exports would not be wise in the aspect of rare earth trade between China and USA. Rare earth is an strategic resource that is crucial in the national defense such as composition of advance alloys and in civilian uses such as batteries. Thus, if Donal Trump impose a tariff as high as 45% on China’s export, China would most likely restrict its rare earth export. China remains as the world dominant export country of rare earth with 105 thousand metric tons compared to 4.1 thousand of the US. China has absolute advantage in the production of rare earth. It would not be wise for Trump be adopt a Beggar-Thy-Neighbor policy, for it would leave China with no choice but to engage in retaliatory policies. The effect on rare earth trade is an externality of the possible trade tariff. Considering the mass demand in the market for batteries in smart devices, an tariff is not only damaging Sino-US relation but also destructive to the world economy.

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http://www.dailynewsegypt.com/2016/11/08/uber-give-drivers-daily-bonus-face-fuel-price-increase/

Because the state has regulated the petrolium price and decided to increase it, Uber has decided to reimburse its drivers based on several levels. There is an 48.6% increase on octane 80, 39.2% increase in octane 92, and 30.5% of diesel. In order to maintain and promote its business and prevent economic loss from happening, Uber Egypt division has decided to reimburse its drivers. This follows the rule of subsidies, drivers are mostly taxed as their demand of petrolium is very inelastic, as a result, they get the most of compensation. Uber create incentives for drivers to drive more as their current policy is that the more trip you drive, the more subsidies you get. This is a clear demonstration of an attempt of creating incentives and trying to main economic profit while new policies are in effect.

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Rideshare Apps Taxed

Uber has become increasingly popular in many Latin American nations. “In just two years in Mexico City, the ride sharing giant has become an integral part of urban life, with around 50,000 drivers navigating the megacity.” Mexico City was the perfect place to implement Uber because it has low rise housing across an urban sprawl. Another reason why Uber has been so sucessfull in Mexico City is due to tradtional street taxis being assocaited with kidnappings. Since Uber provides many safety features for it’s users, it has been able to attract many consumers. Altouugh Uber is such a huge success, many tradtional taxi companies view it as threat to their businesses which is why in Mexico City imposes taxes on rideshare apps. Up to 1.5% of revenue for rideshare apps is taxed by the Mexican goverment. While demand is increasing for Uber, it is a threat to other businesses which is why the goverment taxes Uber.

http://money.cnn.com/2016/12/06/technology/uber-latin-america/index.html?iid=SF_LN

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Prop V would tax sugary drinks in San Francisco

http://www.sfexaminer.com/prop-v-tax-sugary-beverages-san-francisco/

Prop V on the San Francisco voters ballot proposed a $0.01 tax per 1 ounce of sugary beverage (excluding alcoholic, medical, and milk). This tax was originally suggested in 2014 and passed with 55% votes, enough to employ the tax however not enough to cause any significant change to behaviour or harm to soda company profits ($0.01 tax on a sugar-sweetened beverage). In 2016 Prop V passed with 61.87% of votes. This prop was designed to tax distributers and with the hope of decreasing the amount of sugar-sweetened drinks consumed (predominantly by middle-school children) in the attempts to lower Diabetes II. In 2014 a similar tax was placed on sugar-sweetened beverages in Berkley, CA and surveys found the amount of such beverages decreased by 20%.

 

Resources:

https://ballotpedia.org/San_Francisco,_California,_Soda_and_Sugary_Beverages_Tax,_Proposition_V_(November_2016)

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Pacific trade deal cuts U.S. tariffs on light vehicles, sets new duty-free benchmark for local content

In this article, the expected effects of the Trans-Pacific Partnership, known as TPP, on the auto industry are described. TPP is a trade deal promoted by President Obama that would effect the NAFTA countries (USA, Canada, and Mexico) as well as Japan. It furthers the free-trade sentiment of NAFTA, and is currently being debated in the senate. If passed, the TPP would lower protectionist tariffs on many imported goods to America in exchange for the lowering of foreign tariffs on American exports. Specifically, this article talks about the elimination of the current 2.5% tariff on Japanese cars and 25% tariff on trucks that would be caused by ratification of TPP. Lobbyists who are lobbying to keep the current protectionist tariffs argue that the deal would not be good for American auto-workers, as imports of cars will undoubtably increase, whereas auto exports will likely remain stagnant. These protectionist tariffs, which have existed for more than 50 years, have boosted the US auto industry, allowing them to compete with an advantage against the cheaper-to-produce cars of Japan. Without the tariff, the Japanese car companies will increase their exports to America, increasing the supply of foreign cars in the US and lowering their prices as well. Although the American consumer would likely benefit from this trade agreement, as the prices of foreign cars will decrease, this will put strain on the US auto manufacturing industry, and layoffs will likely ensue as the US auto industry will lose some of its influence in the US and global economy.

 

http://www.autonews.com/article/20151005/GLOBAL/151009920/pacific-trade-deal-cuts-u.s.-tariffs-on-light-vehicles-sets-new-duty

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Road taxes in Europe – Not easy being green

In order to control green-house gas emissions, governments have tried to tax petrol and diesel, tax the ownership of dirty cars and offer rebates for greener cars’ buyers. This article explained how fuel tax was the most efficient way to encourage the purchases of greener cars.

http://www.economist.com/news/finance-and-economics/21702762-why-fuel-taxes-are-best-way-encourage-sales-greener-cars-not-easy-being?zid=293&ah=e50f636873b42369614615ba3c16df4a

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