524 Miller Economics Today, Nineteenth Edition
Chapter 6 Funding the Public Sector
How State Trucking Fees Push Up Highway Maintenance Costs
Oregon is the only state that bases highway fees charged to truckers on the amount of weight carried per
truck axle. Having more axles better distributes cargo weight and reduces pressure on the highway,
minimizing wear and tear on the roads. Thus,
freight only within Oregon an incentive to drive trucks with more axles, thereby reducing damage to the
States Seek to Tax Internet Sales
According to the National Governors Association (NGA), failure to collect sales tax on online sales
results in annual tax revenue losses of at least $35 billion. State governments are unable to apply sales tax
rates to most Internet orders for out-of-state goods and services, but this has not stopped them from trying
Eastern Europe Discovers Proportional Taxation
In most nations, income tax systems are progressive. Nevertheless, governments in several Eastern European
nations have recently opted for proportional taxation. Most of these nations were formerly part of the Soviet
Union, such as Russia and Estonia, or were satellites, such as Romania. Beginning in the mid-1990s, the
Lecture Extender Examples 525
Paying for Social Security via a Broadened Payroll Tax
Professionals such as doctors and lawyers who are self-employed pay a Social Security payroll tax rate of
12.4 percent on the first $118,500 of income or $14,694 in Social Security tax. If one of them earned
more than $118,500, the tax on the additional income would be zero. Recently, there have been proposals
to help solve the long-term funding problem in Social Security by charging the tax on all earned income.