How much do you want?

[thegreekdog]

(1) On the 100% tax rate - There can be exemptions input into the law to avoid the situations you're raising. Your other "ultra rich" arguments tend to focus on what they do when they are living. I'm not suggesting punishing the ultra rich. I'm suggesting punishing their children (who had the benefit of living an ultra rich lifestyle up until the death of their parents). There could also be an exemption for charitable giving.

(2) It's not very easy to create a bogus paper business. Not only have economic substance and business purpose been around for legal purposes for many years, I believe they are now included in the Internal Revenue Code. Since I'm talking about a tax, those concepts would apply. So, you could create your "comic book collection" business and it would all be above board; when you die and try to pass that business on to your children, the IRS comes in, says this is not a real business, and your comics go to the government.

(3) Yes, it would drive a whole economy for exemptions. I think that's a good thing.

(4) Should that number be $10 million? Why $10 million (unless it's just arbitrary)?

(5) It probably does depend on the type of business. I'll have to think about that some more when my proposal goes before Congress.

The purpose of my 100% estate tax idea is that if we have this, we can do away with other taxes. The income generated from someone dying is something that I think is less honorable than the income generated by someone working or someone investing and receiving dividends. In other words, if we assume we need some type of government and that government needs to spend money and collect revenue in order to pay for those things, we need some sort of tax. I would rather the government tax estates than tax my income.

Before people die, couldn't they revoke their citizenship?

You'd have to set the tax rate for leaving the country, or revoking one's citizenship, equivalent to your tax policy on estates.

So, would what kind of problems would this create for people trying to leave the country?

Yes, they could revoke citizenship. They could do so now with the existing estate taxes. I'm not sure how that works exactly, but I suspect it's difficult to repatriate funds after death.

I'm going to go out on a limb here.

Why the hate on for inheritances?

Why should they be taxed at a different income. Whoever built up that inheritance payed taxes their whole life.

Inheritance should be subject to no special tax. However treat it as income for the person receiving the inheritance. If they receive 100k and make 40k a year. Then that year for tax purposes they earned 140k. leave it at that.

That would work too (although I'd want the tax on 100%).

I like 100% inheritance taxes, as I indicated above, because there is no work going on by the person receiving the inheritance. Even the guy with a cup on the street has to do more work than a rich kid whose dad dies.

I was actually expecting BBS to say "When the income is received by the spoiled rich kid, he will squander it and it will go to someone else eventually." As far as I'm concerned that's the only thing I need to think about some more.

[thegreekdog]

unless of course the government goofed big time during the years of 2007-2010 by borrowing trillions of dollars, which will eventually have to be repaid (unless they default, which isn't good for citizens either), and is currently "paid" through inflation and depressed interest rates.

Ha. Whatever dude... like that could happen.

[Woodruff]

If we actually had universal health care I wouldn't be quite as disgusted with our government as I am.

You would rather have a system that is unaffordable and mediocre for all than a system that is great for most?

[BigBallinStalin]

If we actually had universal health care I wouldn't be quite as disgusted with our government as I am.

You would rather have a system that is unaffordable and mediocre for all than a system that is great for most?

Everybody, give Woodruff a round of applause for using his first gif expression.




"good show, chap. good show."

[Frigidus]

I'm not really sure just what would be appropriate, but again, there should most definitely be a wealth ceiling.

Why? Why should the government dictate the maximum amount a person can ever earn or have? We don't all work for the government (yet), so it has no right to dictate how much money we earn.

Would you see a problem with one person possessing all of the money that has been printed? Surely you can see that there is a certain amount that one person can have before the lack of others becomes a glaring issue? There has to be a theoretical limit of wealth at some point.

[patrickaa317]

I'm not really sure just what would be appropriate, but again, there should most definitely be a wealth ceiling.

Why? Why should the government dictate the maximum amount a person can ever earn or have? We don't all work for the government (yet), so it has no right to dictate how much money we earn.

Would you see a problem with one person possessing all of the money that has been printed? Surely you can see that there is a certain amount that one person can have before the lack of others becomes a glaring issue? There has to be a theoretical limit of wealth at some point.

Is that currency any good if only one person possesses it? Seems like everyone else would go to a bartering system which could be seen as a better situation given that it wouldn't be easily manipulated by the government.

[Baron Von PWN]

I'm going to go out on a limb here.

Why the hate on for inheritances?

Why should they be taxed at a different income. Whoever built up that inheritance payed taxes their whole life.

Inheritance should be subject to no special tax. However treat it as income for the person receiving the inheritance. If they receive 100k and make 40k a year. Then that year for tax purposes they earned 140k. leave it at that.

Yeah, BVP.

Flat tax, baby! It works on every year on all income earned for that year.

Not so sure about a flat tax. On the surface it sounds fairer, however it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor.

The reason I say it places a higher burden on the poor, is in order to make up the lost revenue the state would then have to raise the base rate of tax. This would hurt the poor the most, those who can least afford to pay more, and benefit the wealthier those who can most afford to pay more. Doesn't seem right to me.

[patrickaa317]

I'm going to go out on a limb here.

Why the hate on for inheritances?

Why should they be taxed at a different income. Whoever built up that inheritance payed taxes their whole life.

Inheritance should be subject to no special tax. However treat it as income for the person receiving the inheritance. If they receive 100k and make 40k a year. Then that year for tax purposes they earned 140k. leave it at that.

Yeah, BVP.

Flat tax, baby! It works on every year on all income earned for that year.

Not so sure about a flat tax. On the surface it sounds fairer, however it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor.

The reason I say it places a higher burden on the poor, is in order to make up the lost revenue the state would then have to raise the base rate of tax. This would hurt the poor the most, those who can least afford to pay more, and benefit the wealthier those who can most afford to pay more. Doesn't seem right to me.

Correction.

Raising a flat tax wouldn't benefit the wealthy, it just wouldn't hurt them as much.

If you have a guy with a dollar and one with a 100 dollars; and plan on taking 10% but then decide to take 20%, the guy who had a $100 doesn't "benefit" off of this he is just able to handle the increase a little better.

[Baron Von PWN]

I'm going to go out on a limb here.

Why the hate on for inheritances?

Why should they be taxed at a different income. Whoever built up that inheritance payed taxes their whole life.

Inheritance should be subject to no special tax. However treat it as income for the person receiving the inheritance. If they receive 100k and make 40k a year. Then that year for tax purposes they earned 140k. leave it at that.

Yeah, BVP.

Flat tax, baby! It works on every year on all income earned for that year.

Not so sure about a flat tax. On the surface it sounds fairer, however it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor.

The reason I say it places a higher burden on the poor, is in order to make up the lost revenue the state would then have to raise the base rate of tax. This would hurt the poor the most, those who can least afford to pay more, and benefit the wealthier those who can most afford to pay more. Doesn't seem right to me.

Correction.

Raising a flat tax wouldn't benefit the wealthy, it just wouldn't hurt them as much.

If you have a guy with a dollar and one with a 100 dollars; and plan on taking 10% but then decide to take 20%, the guy who had a $100 doesn't "benefit" off of this he is just able to handle the increase a little better.

It does benefit the wealthy because they are paying a larger share of taxes currently. With a flat tax you reduce the share paid by the wealthy and increase the share paid by the poor.

So instead of having the one rich guy pay 40$ of his 100$, and the poor guys paying say .05$ of their one dollar. You have the poor guys paying .20 of their dollar so the rich guy can pay 20$ less of his 100$.

[BigBallinStalin]

I'm going to go out on a limb here.

Why the hate on for inheritances?

Why should they be taxed at a different income. Whoever built up that inheritance payed taxes their whole life.

Inheritance should be subject to no special tax. However treat it as income for the person receiving the inheritance. If they receive 100k and make 40k a year. Then that year for tax purposes they earned 140k. leave it at that.

Yeah, BVP.

Flat tax, baby! It works on every year on all income earned for that year.

Not so sure about a flat tax. On the surface it sounds fairer, however it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor.

The reason I say it places a higher burden on the poor, is in order to make up the lost revenue the state would then have to raise the base rate of tax. This would hurt the poor the most, those who can least afford to pay more, and benefit the wealthier those who can most afford to pay more. Doesn't seem right to me.

It isn't right that people must pay different amounts. That fairness argument works either way, and in my humble opinion, let's save it for later and focus on something more important: burden.


It depends on what rate the flat tax is set. Note: this flat tax is a tax on all income--regardless of the means used.

If the rate is 50%, then obviously, that would burden the bottom- and mid- tax brackets.


If it's a flat tax of 10%, then no one is being burdened with much--relative to their previous tax rates. (Lowest income tax in the US is 15% or 16%).

If the flat tax is 20%, but your first $15,000 is exempt, then how are people who earn $15,000 being burdened with taxes that don't burden them?

Then, how are people who earn $20,000, being burdened by a tax which extracts 20% of $5000?

(Note: these questions are comparing the previous tax rates and their burdens imposed).

[patrickaa317]

I'm going to go out on a limb here.

Why the hate on for inheritances?

Why should they be taxed at a different income. Whoever built up that inheritance payed taxes their whole life.

Inheritance should be subject to no special tax. However treat it as income for the person receiving the inheritance. If they receive 100k and make 40k a year. Then that year for tax purposes they earned 140k. leave it at that.

Yeah, BVP.

Flat tax, baby! It works on every year on all income earned for that year.

Not so sure about a flat tax. On the surface it sounds fairer, however it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor.

The reason I say it places a higher burden on the poor, is in order to make up the lost revenue the state would then have to raise the base rate of tax. This would hurt the poor the most, those who can least afford to pay more, and benefit the wealthier those who can most afford to pay more. Doesn't seem right to me.

Correction.

Raising a flat tax wouldn't benefit the wealthy, it just wouldn't hurt them as much.

If you have a guy with a dollar and one with a 100 dollars; and plan on taking 10% but then decide to take 20%, the guy who had a $100 doesn't "benefit" off of this he is just able to handle the increase a little better.

It does benefit the wealthy because they are paying a larger share of taxes currently. With a flat tax you reduce the share paid by the wealthy and increase the share paid by the poor.

So instead of having the one rich guy pay 40$ of his 100$, and the poor guys paying say .05$ of their one dollar. You have the poor guys paying .20 of their dollar so the rich guy can pay 20$ less of his 100$.

Ah, your comparing it to now and not to being implemented then raising it. Sorry misread that.

I guess I don't know why one group of people should only work 2 hours a week to raise revenue for the government while another group is required to work 16 hours a week. Assuming both work 40 hour weeks.

[Woodruff]

I'm going to go out on a limb here.

Why the hate on for inheritances?

Why should they be taxed at a different income. Whoever built up that inheritance payed taxes their whole life.

Inheritance should be subject to no special tax. However treat it as income for the person receiving the inheritance. If they receive 100k and make 40k a year. Then that year for tax purposes they earned 140k. leave it at that.

Yeah, BVP.

Flat tax, baby! It works on every year on all income earned for that year.

Not so sure about a flat tax. On the surface it sounds fairer, however it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor.

The reason I say it places a higher burden on the poor, is in order to make up the lost revenue the state would then have to raise the base rate of tax. This would hurt the poor the most, those who can least afford to pay more, and benefit the wealthier those who can most afford to pay more. Doesn't seem right to me.

I think it's the right idea, but I would agree with you that the "bottom line of tax-payment" should be higher than (I think he said) $15,000.
Where I think it should be...quite honestly, I have no idea. But that definitely seems too low to me.

[BigBallinStalin]

I don't get it.


Let's say you make $50,000 per year in "income" as defined by the US government.

According to http://www.moneychimp.com/features/tax_brackets.htm, you'd pay $8,530 in taxes.


With a flat tax of 20%, you'd pay $7000 in taxes. ($50k - $15k = $35, then $35k * 0.20 = $7000 )


You're paying less taxes, yet Woodruff and BVP say:

BVP: "it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor. " cuz "they'd have to raise the base rate."

Base rate = 20% on all income from wherever. That's it.

Woodruff: But that [tax exemption] definitely seems too low to me.

If you're earning $50,000 per year, including all income, then you'll be taxed $1530 less than the current tax rates...

As you earn more money, you'll get to keep more of it. If you earn less, that $15,000 tax exemption still saves your ass--compared to the current tax rates.

[Woodruff]

I don't get it.

Let's say you make $50,000 per year in "income" as defined by the US government.

According to http://www.moneychimp.com/features/tax_brackets.htm, you'd pay $8,530 in taxes.

With a flat tax of 20%, you'd pay $7000 in taxes. ($50k - $15k = $35, then $35k * 0.20 = $7000 )

You're paying less taxes, yet Woodruff and BVP say:

BVP: "it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor. " cuz "they'd have to raise the base rate."

Base rate = 20% on all income from wherever. That's it.

Woodruff: But that [tax exemption] definitely seems too low to me.

If you're earning $50,000 per year, including all income, then you'll be taxed $1530 less than the current tax rates...

As you earn more money, you'll get to keep more of it. If you earn less, that $15,000 tax exemption still saves your ass--compared to the current tax rates.

You seem to be making the mistake of believing that BvP (who I am not speaking for) and I believe that the current tax system is a good and fair one.

[BigBallinStalin]

I sidestepped the fairness argument with BVP and haven't brought that up with you, so you're putting words in my post.





As I've quoted you:

Woodruff: But that [tax exemption] definitely seems too low to me.
(or "that" refers to the flat tax rate).



So, what's your contention against the 20% flat tax + $15,000 exemption?

[Woodruff]

So, what's your contention against the 20% flat tax + $15,000 exemption?

I thought I stated it...I think the $15,000 flat exemption is a bit too low. As I said, I think it's the right idea, but I just think the "bottom end" of beginning to pay any taxes should be a bit higher than that. Any system would also need a mechanism for adjusting that level (up and down).

EDIT: Sorry, you edited your post while I was posting, so I'm going to edit mine:

I sidestepped the fairness argument with BVP and haven't brought that up with you, so you're putting words in my post.

I'm not really trying to put words in your mouth, I'm simply pointing out that you seemed to be making that presumption. Because I can't think of another reason why you'd try to make that comparison.

[BigBallinStalin]

So, what's your contention against the 20% flat tax + $15,000 exemption?

I thought I stated it...I think the $15,000 flat exemption is a bit too low. As I said, I think it's the right idea, but I just think the "bottom end" of beginning to pay any taxes should be a bit higher than that. Any system would also need a mechanism for adjusting that level (up and down).

Why is the exemption too low?

EDIT: Sorry, you edited your post while I was posting, so I'm going to edit mine:

I sidestepped the fairness argument with BVP and haven't brought that up with you, so you're putting words in my post.

I'm not really trying to put words in your mouth, I'm simply pointing out that you seemed to be making that presumption. Because I can't think of another reason why you'd try to make that comparison.

Because making comparisons matter.

Otherwise, 'why change it from A to B?' Without a comparison, I don't see how the argument bears much relevance. With tax policy debates, we'd be shifting from tax policy A to tax policy B. It helps to know where you came from and where you're going in order to explain that an alternative route would be better/worse.

[Gillipig]

How about 75% for own businesses. Sound laughable? Welcome to Sweden!!! The glorious country where own businessmen are treated like criminals.

[thegreekdog]

How about 75% for own businesses. Sound laughable? Welcome to Sweden!!! The glorious country where own businessmen are treated like criminals.

Yeah, but I heard Sweden was one of the best countries in the world in which to live.

[Gillipig]

How about 75% for own businesses. Sound laughable? Welcome to Sweden!!! The glorious country where own businessmen are treated like criminals.

Yeah, but I heard Sweden was one of the best countries in the world in which to live.

Don't believe everything you hear.

[Woodruff]

So, what's your contention against the 20% flat tax + $15,000 exemption?

I thought I stated it...I think the $15,000 flat exemption is a bit too low. As I said, I think it's the right idea, but I just think the "bottom end" of beginning to pay any taxes should be a bit higher than that. Any system would also need a mechanism for adjusting that level (up and down).

Why is the exemption too low?

It seems to me that expecting someone to live below the poverty line and still pay taxes is a bit onerous.

EDIT: Sorry, you edited your post while I was posting, so I'm going to edit mine:

I sidestepped the fairness argument with BVP and haven't brought that up with you, so you're putting words in my post.

I'm not really trying to put words in your mouth, I'm simply pointing out that you seemed to be making that presumption. Because I can't think of another reason why you'd try to make that comparison.

Because making comparisons matter.
Otherwise, 'why change it from A to B?' Without a comparison, I don't see how the argument bears much relevance. With tax policy debates, we'd be shifting from tax policy A to tax policy B. It helps to know where you came from and where you're going in order to explain that an alternative route would be better/worse.

Then don't whine about me putting words into your mouth (which I maintain I was not doing). It seems stupid to me to compare something to an even more shitty something as a basis for whether that something is a good thing or not. It should be viewed on it's own merits.

[Baron Von PWN]

I don't get it.


Let's say you make $50,000 per year in "income" as defined by the US government.

According to http://www.moneychimp.com/features/tax_brackets.htm, you'd pay $8,530 in taxes.


With a flat tax of 20%, you'd pay $7000 in taxes. ($50k - $15k = $35, then $35k * 0.20 = $7000 )


You're paying less taxes, yet Woodruff and BVP say:

BVP: "it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor. " cuz "they'd have to raise the base rate."

Base rate = 20% on all income from wherever. That's it.

Woodruff: But that [tax exemption] definitely seems too low to me.

If you're earning $50,000 per year, including all income, then you'll be taxed $1530 less than the current tax rates...

As you earn more money, you'll get to keep more of it. If you earn less, that $15,000 tax exemption still saves your ass--compared to the current tax rates.

Ok here's my issue with a flat tax. It's not going to cut it.

With the current tax regime government has difficulty paying for everything.

So how do we make up the difference in revenue? Well you'd have to meet somewhere in the middle to get the same revenue.

This would undoubtedly mean a higher tax rate on the lower income earners.

Unless of course you slash and burn government spending. Which would have a medley of consequences as well,likely resulting in decreased services for lower income earners, those most likely to use them.

Sure in theory it sounds great, in practice it seems to me there would be significant issues.

[thegreekdog]

I don't get it.


Let's say you make $50,000 per year in "income" as defined by the US government.

According to http://www.moneychimp.com/features/tax_brackets.htm, you'd pay $8,530 in taxes.


With a flat tax of 20%, you'd pay $7000 in taxes. ($50k - $15k = $35, then $35k * 0.20 = $7000 )


You're paying less taxes, yet Woodruff and BVP say:

BVP: "it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor. " cuz "they'd have to raise the base rate."

Base rate = 20% on all income from wherever. That's it.

Woodruff: But that [tax exemption] definitely seems too low to me.

If you're earning $50,000 per year, including all income, then you'll be taxed $1530 less than the current tax rates...

As you earn more money, you'll get to keep more of it. If you earn less, that $15,000 tax exemption still saves your ass--compared to the current tax rates.

Ok here's my issue with a flat tax. It's not going to cut it.

With the current tax regime government has difficulty paying for everything.

So how do we make up the difference in revenue? Well you'd have to meet somewhere in the middle to get the same revenue.

This would undoubtedly mean a higher tax rate on the lower income earners.

Unless of course you slash and burn government spending. Which would have a medley of consequences as well,likely resulting in decreased services for lower income earners, those most likely to use them.

Sure in theory it sounds great, in practice it seems to me there would be significant issues.

The significant issue would be cutting expense. Frankly, I took the cuts into account when I answered the question. Not to speak for BBS, but I suspect he did too.

And how does a flat tax rate = a higher tax rate for lower income earners? I don't think I understand the point.

[Baron Von PWN]

I don't get it.


Let's say you make $50,000 per year in "income" as defined by the US government.

According to http://www.moneychimp.com/features/tax_brackets.htm, you'd pay $8,530 in taxes.


With a flat tax of 20%, you'd pay $7000 in taxes. ($50k - $15k = $35, then $35k * 0.20 = $7000 )


You're paying less taxes, yet Woodruff and BVP say:

BVP: "it places a greater share of the state's burden on the poor, of course you mentioned an exemption for people earning under X amount. In which case it still places a heavier burden on the poor, just not the ultra poor. " cuz "they'd have to raise the base rate."

Base rate = 20% on all income from wherever. That's it.

Woodruff: But that [tax exemption] definitely seems too low to me.

If you're earning $50,000 per year, including all income, then you'll be taxed $1530 less than the current tax rates...

As you earn more money, you'll get to keep more of it. If you earn less, that $15,000 tax exemption still saves your ass--compared to the current tax rates.

Ok here's my issue with a flat tax. It's not going to cut it.

With the current tax regime government has difficulty paying for everything.

So how do we make up the difference in revenue? Well you'd have to meet somewhere in the middle to get the same revenue.

This would undoubtedly mean a higher tax rate on the lower income earners.

Unless of course you slash and burn government spending. Which would have a medley of consequences as well,likely resulting in decreased services for lower income earners, those most likely to use them.

Sure in theory it sounds great, in practice it seems to me there would be significant issues.

The significant issue would be cutting expense. Frankly, I took the cuts into account when I answered the question. Not to speak for BBS, but I suspect he did too.

And how does a flat tax rate = a higher tax rate for lower income earners? I don't think I understand the point.

I said it places a heavier burden on the poor. Not necessarily a higher tax rate.

Well government currently gets its money from a graduated income tax which has most brackets paying more than 20%. How do you make up the difference in income for the brackets you've just eliminated?

A higher base rate.

Or

You slash and burn government services to balance a budget with a 20% flat tax. So the lower income earners in all likelihood lose most of the services they used to enjoy courtesy of the government, and now must provide them themselves or go without and pay just as much tax as they used to.

In effect they pay for the wealthier citizen's massive tax cut, and must now pay for services formerly paid for by the state, or lose them entirely. How does this not increase the burden on the poor?

[thegreekdog]

Not necessarily a higher tax rate.

You wrote "higher tax rate." Just saying.

You slash and burn government services to balance a budget with a 20% flat tax. So the lower income earners in all likelihood lose most of the services they used to enjoy courtesy of the government, and now must provide them themselves or go without and pay just as much tax as they used to.

In effect they pay for the wealthier citizen's massive tax cut, and must now pay for services formerly paid for by the state, or lose them entirely. How does this not increase the burden on the poor?

(1) Why are we cutting services to low income earners? You've made that assumption, which, for my purposes, is a false one. I would like to cut a lot of services that apply to high income earners. For example, military spending and business cash incentives. We're also eliminating tax benefits. For example, special deductions and credits for businesses. For example, raise the rate on capital gains to the flat tax rate.

(2) Massive tax cut? Wealthy people WHO WORK FOR A LIVING pay up to 35%. Wealthy people WHO INVEST FOR A LIVING pay 15%. It would be a TAX INCREASE on the wealthy investors (e.g. Romney, Buffett). The people who would benefit most are those who earn ordinary income which is taxed at 35% who earn more than $1 million (essentially). Not a lot of those people around.