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re: US CPI comes in "hotter than expected"
Posted on 5/15/24 at 11:51 am to JohnnyKilroy
Posted on 5/15/24 at 11:51 am to JohnnyKilroy
quote:
But how are you to effectively distill that to a single number when sales tax rates vary wildly on a state, county and municipal level
That's a different point. You are noting that data like this are likely to be inaccurate (like the basket of goods which changes)
The other bigger problem is the data are inconvenient.
quote:
The tax rate doesn’t change as prices move, so it’s really not very useful to include them in a measurement that is largely focused on MoM and YoY deltas
Taxes do change and sometimes significantly from year to year (this year the difference in federal refund hit spring auto sales for example). They have a huge cumulative effect on consumer spending and the economy.
1
Posted on 5/15/24 at 12:13 pm to molsusports
quote:
They have a huge cumulative effect on consumer spending and the economy.
True, but I feel like the number that gets spat out would be of very limited value if you are trying to add in some sort of average effective tax rate (including income, property and sales taxes, less deductions and credits) for 350 million people.
If the national average for the price of milk is X, you can probably expect to pay roughly X when you buy milk. Might not be the exact number, but probably pretty close.
If you change it to say that milk is X plus a blanket effective tax rate, your number will be not really reflective of what someone pays at the register when buying milk.
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