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Tax questions.

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Answered (Verified) This post has 4 verified answers | 6 Replies | 2 Followers

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No2statism posted on Wed, Sep 19 2012 6:32 AM

1.  Would it be better to have a top marginal income tax rate of 45% or greater with elimination of all payroll taxes or would it  be better to have it as it currently is?

I was thinking the former because It seems that would cause the govt would get less revenue.

2.  Why have liberals never advocated for a federal real estate tax with a large exemption and high rates after the automatic exemption?

3.  Wouldnt that be more egalitarian than the income tax?

i favor no govt revenue, but I'm at a loss to figure out why not even Bernie Sanders and Kuchinich have advocated for a federal real estate tax.  I'm guessing it's because they've never thought of it, but I'm guessing the other liberals haven't advocated it because they don't want to pay it, but I don't know... so that's why I'm asking.

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Answered (Verified) Phi est aureum replied on Wed, Sep 19 2012 8:15 AM
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I would honestly guess a big reason is that it is not easy to sell new taxes to the public, let alone get them passed in Congress. As to why not specifically a property tax, I do not know.

The only one worth following is the one who leads... not the one who pulls; for it is not the direction that condemns the puller, it is the rope that he holds.

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Answered (Verified) Bogart replied on Wed, Sep 19 2012 2:41 PM
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1. Not clear which is superior to the average person, my opinion is that under the current system at least some job creators would have lower tax bills than the one where everyone gets hit with a huge 45% tax bill (Most flat tax estimates are in the 15% to 20% range).  Your 45% suggestion does have one huge problem which is that it turns Social Security into even more of a welfare scheme than it already is.  This would piss off quite a lot of old folks.

2. Because they are NOT that stupid.  The majority of large estates are in the forms of family owned businesses and farms.  A large estate tax devastates these groups many of whom are Liberals themselves.  Furthermore the majority of employment comes from these groups and in the bottom of their bleeding hearts these liberals really do not want to wreck the economy or get millions of other liberals pissed off at them because their small employers were sold to big employers as parts of estates and they got laid off.

3. No, there are not enough wealthy people to get rid of the other taxes so the estate tax is in addition to them which means that the wealthy must pay taxes twice on income and then estate.  (Note that if there is property transferred then the wealthy pay 3 times: income, capital gain, and estate)  Furthermore there is no easier tax to dodge as the wealthy need only transfer assets offshore (Or worse create the assets offshore in the first place which seems to be the NORM these days), hide them in the complex estate/trust legal system and/or consume them when they would want to pass them on.

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Answered (Verified) Phi est aureum replied on Wed, Sep 19 2012 8:49 PM
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Another thing to consider is although liberals tend to favor redistribution of wealth, I wonder if many of them do know, since it is known, that raising taxes has little chance of raising revenue and that raising taxes too high tends to discourage economic activity or encourages more off-shore accounts and such. That is, if many of them have a goal of increasing revenue but know raising taxes won't work, would they just say things like "Raise the top marginal rate!" since their constituents support such an idea, knowing that it won't work and couldn't pass anyway?

The only one worth following is the one who leads... not the one who pulls; for it is not the direction that condemns the puller, it is the rope that he holds.

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Answered (Verified) Jack Roberts replied on Thu, Sep 20 2012 2:51 PM
Verified by No2statism

Don't give them any new ideas...

It is a nice discussion to have, what type of tax would be best, but the bottom line is that the government in its current state would never allow for any tax changes that reduced revenue.

UK Net taxes and national insurance contributions £bn

source

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Answered (Verified) Phi est aureum replied on Wed, Sep 19 2012 8:15 AM
Verified by No2statism

I would honestly guess a big reason is that it is not easy to sell new taxes to the public, let alone get them passed in Congress. As to why not specifically a property tax, I do not know.

The only one worth following is the one who leads... not the one who pulls; for it is not the direction that condemns the puller, it is the rope that he holds.

  • | Post Points: 25
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Answered (Verified) Bogart replied on Wed, Sep 19 2012 2:41 PM
Verified by No2statism

1. Not clear which is superior to the average person, my opinion is that under the current system at least some job creators would have lower tax bills than the one where everyone gets hit with a huge 45% tax bill (Most flat tax estimates are in the 15% to 20% range).  Your 45% suggestion does have one huge problem which is that it turns Social Security into even more of a welfare scheme than it already is.  This would piss off quite a lot of old folks.

2. Because they are NOT that stupid.  The majority of large estates are in the forms of family owned businesses and farms.  A large estate tax devastates these groups many of whom are Liberals themselves.  Furthermore the majority of employment comes from these groups and in the bottom of their bleeding hearts these liberals really do not want to wreck the economy or get millions of other liberals pissed off at them because their small employers were sold to big employers as parts of estates and they got laid off.

3. No, there are not enough wealthy people to get rid of the other taxes so the estate tax is in addition to them which means that the wealthy must pay taxes twice on income and then estate.  (Note that if there is property transferred then the wealthy pay 3 times: income, capital gain, and estate)  Furthermore there is no easier tax to dodge as the wealthy need only transfer assets offshore (Or worse create the assets offshore in the first place which seems to be the NORM these days), hide them in the complex estate/trust legal system and/or consume them when they would want to pass them on.

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No2statism replied on Wed, Sep 19 2012 8:16 PM

 

Thanks: ). I actually meant a residential property tax, rather than the current estate tax also known as the death tax.  The 45% top marginal rate wouldn't be the only rate, I guess maybe adding a 45% bracket to the current tax code and started it at, say, 1mn of taxable income like Obama wanted to do, was what I meant. Sorry about that.

 

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Answered (Verified) Phi est aureum replied on Wed, Sep 19 2012 8:49 PM
Verified by No2statism

Another thing to consider is although liberals tend to favor redistribution of wealth, I wonder if many of them do know, since it is known, that raising taxes has little chance of raising revenue and that raising taxes too high tends to discourage economic activity or encourages more off-shore accounts and such. That is, if many of them have a goal of increasing revenue but know raising taxes won't work, would they just say things like "Raise the top marginal rate!" since their constituents support such an idea, knowing that it won't work and couldn't pass anyway?

The only one worth following is the one who leads... not the one who pulls; for it is not the direction that condemns the puller, it is the rope that he holds.

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No2statism replied on Thu, Sep 20 2012 5:56 AM

 

Phi est aureum:

Another thing to consider is although liberals tend to favor redistribution of wealth, I wonder if many of them do know, since it is known, that raising taxes has little chance of raising revenue and that raising taxes too high tends to discourage economic activity or encourages more off-shore accounts and such. That is, if many of them have a goal of increasing revenue but know raising taxes won't work, would they just say things like "Raise the top marginal rate!" since their constituents support such an idea, knowing that it won't work and couldn't pass anyway?

 

@phi est aureum:  I agree.  I was thinking raising the top marginal income tax rate is fine because it won't put more revenue into the govt coffers.  I think that the Republicans are being more statist on the tax issue by always advocating revenue neutrality and reform rather than abolition.  At least the Democrats want to reduce or eliminate the payroll tax and that would really cut govt revenues.  The Republicans actually want to tax more than the Democrats do and that's a problem because so many people think the Republicans want to cut taxes, when they just want to fiddle with the income tax code.  I'm definitely not voting for Obama, but I'm very unhappy that so many people can't even reason.

 

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Answered (Verified) Jack Roberts replied on Thu, Sep 20 2012 2:51 PM
Verified by No2statism

Don't give them any new ideas...

It is a nice discussion to have, what type of tax would be best, but the bottom line is that the government in its current state would never allow for any tax changes that reduced revenue.

UK Net taxes and national insurance contributions £bn

source

  • | Post Points: 25
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