I voted "Bannable" on the poll, but bear in mind, my honest answer to the poll is "both". The punishment ladder Riot currently uses is reliable and pretty good in terms of applying sufficient punishment to toxic players.
I've been banned on a couple occasions, even permabanned (then unbanned), but it was because i would call people pretty mean names and slurs. Why do I receive a suspension rather than a chat restriction for typing? Personally i dont understand the thought behind this.
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I recently got another 2 week vacation for saying "fa** ezreal player" twice-ish, which didnt exactly ruin the game for anyone besides the ezreal for about 5 seconds, but it still amazes me that i got 2 weeks for about two short messages.
You got a two-week suspension instead of a chat restriction because homophobic slurs - hate speech in general - are absolutely not acceptable, and you should know as much. Chat restrictions wouldn't be sufficient for such horrendous, hateful comments.
Riot bans players for toxic chat for what can be broken down into two major reasons;
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Egregious offences, such as hate speech like you used, are just plain unacceptable and warrant an escalated punishment. If it's something you know you shouldn't be saying, then the repercussions for saying it regardless should be heavier.
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Continuous toxicity and flouting the rules also warrants account bans, since people who commit more modest offenses (at least compared to hate speech/encouragements of self-harm) generally tend to go through the punishment ladder.
Those who don't heed the 10-game Chat Restriction will get a 25-game Chat Restriction, and those who ignore that punishment will suffer a 14-day ban, with a warning that any further misbehavior will warrant a permanent suspension. And if after three separate warnings, one being "this is your last chance", players still continue to be toxic? Then they don't deserve to play the game.
Chat toxicity is ultimately bannable because players agreed to follow Riot's rules - and when they continue to ignore the rules and be toxic time after time after time, Riot has to put their foot down somewhere. They're not going to just let people continue to flout the rules and effectively spit in their faces - if people can't be bothered to play by the rules, Riot can't be bothered to have them playing at all.
I never would int or go afk because of a bad team, and i never have, but those are the only reasons i can think of when someone should be banned.
You aren't the only person of the opinion that bans should be reserved for gameplay-related offenses (intentionally feeding, trolling, afk'ing, cheating, etc.), and, while it is a valid viewpoint, it is worth considering that the majority of the community - as well as Riot - feel differently.
It's also worth considering that you might be placing too little stock in how chat affects people. Negative/inflammatory chat can drain a team's morale and break team cohesion, and I've seen all too well what a difference can be made when people strive to either tear down or build up their teammates.
The player(s) who ruin the enjoyment of the game in a way that other players cannot control, unlike muting pings and such, should be put on vacation.
Are you seriously suggesting that people be banned for muting pings or chat? How's about you consider why they're muting you in the first place? Flaming, ping-spamming, etc?
Now, which should actually be bannable? The player taking the liberties Riot provides to protect themselves from other people's misbehavior, or the people breaking the rules, flaming them, and generally being the root cause of people muting?
Perhaps, if you didn't flame and harass and spout slurs, people wouldn't have to mute, and you could keep up communication. Like I said before; chat has more impact than you might think.
Coming from years on Xbox cod lobbies of everyone screaming every known slur at a moments notice to being mean for a moment gets you in trouble, its a leap. I can understand wanting to be more user friendly, but I dunno.
I'll be frank; if you want a Call of Duty environment, you play Call of Duty. When you play League, you're playing a team game, where you're expected to cooperate with your team and fight with them, not against them. You agreed to show a measure of composure and sportsmanship when you made your account. It may be a leap, but as it were - Riot's house, Riot's rules.
EDIT: Struckthrough a section due to having misread the OP's post; mistakes were made, much to my chagrin.