4.6% tax hike = one of the biggest tax hikes in US history

[obvious Child]

Just curious, how many of you think that a 4.6% increase in marginal tax rates on the highest tax bracket is "one of the biggest tax hikes in US history?"

 

[RedAkston]

Just curious, how many of you think that a 4.6% increase in marginal tax rates on the highest tax bracket is "one of the biggest tax hikes in US history?"

Based on the amount of money this is compared to in the past, I voted yes.

 

[danarhea]

Based on the amount of money this is compared to in the past, I voted yes.

You can't go with the amount of money because, due to inflation over the years, you cannot make a meaningful comparison.

You have to go with percentage of income. The record, based on percentage of income, is held by FDR, who increased the highest tax bracket to 90%.

 

[obvious Child]

Based on the amount of money this is compared to in the past, I voted yes.

Besides the fact that danarhea again proved that good economics and statistics is thoroughly dead here as indicated by your argument, the 4.6% is a tiny tax hike in history. And if we want to look at your reasoning, the tax hike here even on dollars is small compared to the first income tax which had a benchmark of zero.

 

[Kushinator]

Besides the fact that danarhea again proved that good economics and statistics is thoroughly dead here as indicated by your argument, the 4.6% is a tiny tax hike in history. And if we want to look at your reasoning, the tax hike here even on dollars is small compared to the first income tax which had a benchmark of zero.

Ehh, that is debatable. Millionaires per capita (or the 1940's equivalent in real dollars) is probably much much much higher today. Therefore the total tax revenue is quite valid.

Most likely, this tax hike represents one of the biggest income transfers in real dollars. Although i am only speculating.

 

[obvious Child]

Ehh, that is debatable. Millionaires per capita (or the 1940's equivalent in real dollars) is probably much much much higher today. Therefore the total tax revenue is quite valid.

But if we're going purely by total tax revenue, merely because it collects a seemingly record amount (which it probably won't) that money is not inflated adjusted. To really argue the point on total tax revenues, we need to inflation adjust the amounts collected by other tax collections. Remember that WWII debt was over $2 trillion in today's dollars, much of that paid with tax hikes and debt. God knows just how much total tax revenue the jump to 91% back in the 30s brought in when we dollar adjust it.

Most likely, this tax hike represents one of the biggest income transfers in real dollars. Although i am only speculating.

I'm not so sure about that. I'm pretty sure that inflation since the tax cut has increased more then 4.6%. Raising taxes 4.6% on money that has been degraded by more then 4.6% doesn't suggest that it is one of the biggest income transfers in real dollars. What value are we giving to the real dollar?

If we raise your taxes 5% on dollars that have degraded 10% due to inflation, how many real dollars have we collected?

 

[Kushinator]

But if we're going purely by total tax revenue, merely because it collects a seemingly record amount (which it probably won't) that money is not inflated adjusted. To really argue the point on total tax revenues, we need to inflation adjust the amounts collected by other tax collections. Remember that WWII debt was over $2 trillion in today's dollars, much of that paid with tax hikes and debt. God knows just how much total tax revenue the jump to 91% back in the 30s brought in when we dollar adjust it.

You are missing the point though, as inflation is not the issue. What if only one person was taxed 90%, although the tax increase was hiked from 50%-90%? There are more high income earners now than there were then.

I'm not so sure about that. I'm pretty sure that inflation since the tax cut has increased more then 4.6%. Raising taxes 4.6% on money that has been degraded by more then 4.6% doesn't suggest that it is one of the biggest income transfers in real dollars. What value are we giving to the real dollar?

If we raise your taxes 5% on dollars that have degraded 10% due to inflation, how many real dollars have we collected?

Again you are missing the point on inflation. It is not the tax increase that is important, it is the amount of currency transferred per capita. If you want to use cpi deflators, be my guest; although it is quite unnecessary. After the great depression, how many high income earners were being taxed over 90%, 80%, 70% etc...?

 

[TurtleDude]

The huge hike will be jacking up the dividend tax-which is now around 45% to over 65%

 

[obvious Child]

You are missing the point though, as inflation is not the issue. What if only one person was taxed 90%, although the tax increase was hiked from 50%-90%? There are more high income earners now than there were then.

Actually inflation is the issue. But in terms of the # of millionaires, it's far more dependent upon income rather then number. If a hundred millionaires made $500,000 and were taxed at 39.6% of that at the highest rate, that would be less then 10 billionaires making $500 million apiece being taxed at the highest marginal rate of 91%. The # of people actually isn't that relevant. It's the amount of earned income.

Again you are missing the point on inflation. It is not the tax increase that is important, it is the amount of currency transferred per capita.

It is when you want to talk about real dollars. Nominal, sure it's probably one of the largest. REAL however is another animal all together.

If you want to use cpi deflators, be my guest; although it is quite unnecessary. After the great depression, how many high income earners were being taxed over 90%, 80%, 70% etc...?

Don't know. Hence why we need more data. But purely from a % of income, this cannot be one of the highest given historical tax rates.

 

[obvious Child]

The huge hike will be jacking up the dividend tax-which is now around 45% to over 65%

Where are you getting that? Right now the qualified dividend rate is either 0% or 15% depending on your AGI. Last I checked, Obama wants it to go to 28% where it was before the cut.

And unqualified dividends are ordinary.

Where are you getting your information from?

 

[Kushinator]

Don't know. Hence why we need more data. But purely from a % of income, this cannot be one of the highest given historical tax rates.

Then what was the point of your thread? Surely we do not need a poll to decipher whether we think 4.6% is greater than 10%. From a sheer quantitative perspective, adjusting for inflation, this was one of the biggest tax hikes ever. As in a large income transfer.

 

[TurtleDude]

Where are you getting that? Right now the qualified dividend rate is either 0% or 15% depending on your AGI. Last I checked, Obama wants it to go to 28% where it was before the cut.

And unqualified dividends are ordinary.

Where are you getting your information from?

I guess you forget that owners of a corporation pay are taxed TWICE on corporate profits.

 

[obvious Child]

I guess you forget that owners of a corporation pay are taxed TWICE on corporate profits.

Well if you want to calculate it that way, you're still mathematically wrong.

Corporate tax rates, while having much lower thresholds top out at 35% (well, stated). Therefore highest tax bracket would see profits first taxed at 35% and then at 15%, for a total of 50%.

 

[obvious Child]

Then what was the point of your thread? Surely we do not need a poll to decipher whether we think 4.6% is greater than 10%.

You might want to ask Aquapub. He's avoiding numerous posts all asking if he thinks that's true.

From a sheer quantitative perspective, adjusting for inflation, this was one of the biggest tax hikes ever. As in a large income transfer.

Not quite. Not adjusted for inflation, it's on a nominal dollar value a large tax hike. But nominal dollars don't really tell us all that much. Furthermore, nominal dollar measures will constantly be increasing, meaning every tax hike of material size will be of the largest. It's like Hollywood's claim about movies making more money. None of it deals with inflation pegging.

 

[TurtleDude]

Well if you want to calculate it that way, you're still mathematically wrong.

Corporate tax rates, while having much lower thresholds top out at 35% (well, stated). Therefore highest tax bracket would see profits first taxed at 35% and then at 15%, for a total of 50%.

Actually it works like this

I own 10% of a company that makes a million

so my pre tax share is 100k

35% tax on that and its down to 65K

15% tax on 65K is about 9750

leaving me 55250

so the rate is about 44%

now jack up dividend taxes to almost 40% like Bamboob wants to do

what is the rate gonna be

 

[obvious Child]

Actually it works like this

I own 10% of a company that makes a million

so my pre tax share is 100k

35% tax on that and its down to 65K

15% tax on 65K is about 9750

leaving me 55250

so the rate is about 44%

now jack up dividend taxes to almost 40% like Bamboob wants to do

what is the rate gonna be

Out of curiosity, why did you decide to structure as a corporation rather then a partnership like organization?

It seems to me that you could have done thing to minimize your tax liability. Better then complaining.

 

[Kushinator]

Not quite. Not adjusted for inflation, it's on a nominal dollar value a large tax hike. But nominal dollars don't really tell us all that much. Furthermore, nominal dollar measures will constantly be increasing, meaning every tax hike of material size will be of the largest. It's like Hollywood's claim about movies making more money. None of it deals with inflation pegging.

Your assumptions cause you to shoot yourself in the foot. There are more people now, and workers are more productive, hence we have more millionaires (adjusting for inflation), or a greater proportion of people in the higher tax bracket. That era was more like Moscow is now; more billionaires live there than NYC, yet NYC is exponentially more wealthy.

So lets say Moscow has higher progressive tax rates. Do you really believe their highest tax bracket would take in more revenue than our new top bracket rate?

 

[obvious Child]

Your assumptions cause you to shoot yourself in the foot. There are more people now, and workers are more productive, hence we have more millionaires (adjusting for inflation), or a greater proportion of people in the higher tax bracket. That era was more like Moscow is now; more billionaires live there than NYC, yet NYC is exponentially more wealthy.

But again, as you choose to ignore in my post post, the issue is actually about tax revenues. As stated before a 4.6% increase on 100 millionaires all making $500,000 in earned income will bring in significently less then a 52% increase on 10 billionaires making $500 million in earned income. Merely because you have more rich people does not equate to greater tax revenues and tax revenues seems to be how we're discussing whether or not the 4.6% increase is really one of the largest in US history.

So lets say Moscow has higher progressive tax rates. Do you really believe their highest tax bracket would take in more revenue than our new top bracket rate?

Depends how high their highest bracket is.

 

[Kushinator]

But again, as you choose to ignore in my post post, the issue is actually about tax revenues. As stated before a 4.6% increase on 100 millionaires all making $500,000 in earned income will bring in significently less then a 52% increase on 10 billionaires making $500 million in earned income.

yes, but this is highly unrealistic. The economy is larger than it was then. At least 5 times the size if you factor inflation. Do a gdp/capita deflator from 2007 dollars to 1950 dollars. Reply with your findings, although i suspect it to be no greater than $9,000.

Merely because you have more rich people does not equate to greater tax revenues and tax revenues seems to be how we're discussing whether or not the 4.6% increase is really one of the largest in US history.

Then prove your point by locating a time in history, such as the 1940's or 50's, which provided more real tax revenue dollars than this instance. I believe the largest (in sheer quantity adjusting for inflation) was during the Clinton administration, although this could potentially be the biggest if the recession is averted in under 5 years.

Depends how high their highest bracket is.

LOL, I believe it is 45%. I highly doubt their highest bracket takes in more revenue than our highest bracket:roll:

 

[Maximus Zeebra]

Just curious, how many of you think that a 4.6% increase in marginal tax rates on the highest tax bracket is "one of the biggest tax hikes in US history?"

What a silly poll.. Where is the "other" option?

I voted "none of the above", but the tax hike is small compared to what it needs to be for the US to get out of their horrible economic mess and near(/ongoing) bankruptcy.

 

[TurtleDude]

Out of curiosity, why did you decide to structure as a corporation rather then a partnership like organization?

It seems to me that you could have done thing to minimize your tax liability. Better then complaining.

I was using that as an example because I can do the numbers quickly rather than saying I am one of 100000 stockholders of a billion dollar profit generating business


There should be no progressive tax on income or estates. It allows the government to divide people and gain more power. Politicians SHOULD NOT BE permitted to buy the votes of the tax consumers by promising that they will jack up the rates on those of us who pay most of the taxes

I love Bamawad and his minions claiming 95% of americans will get an income tax cut


not only is that impossible it sort of falls apart when those not getting a cut-but rather a soaking pay almost half the taxes


he should have said -HALF THE TAX BASE will get a cut-the other half is going to get raped because they cannot out vote you

 

[UtahBill]

Piddling amount of tax increase, it won't affect me at all.....so I don't care if the rich have to pay a little more. If that wealth is transferred to the poor, it might even benefit the economic health of the nation.
Go for it, Obama, soak the rich.....:2razz:

 

[Goobieman]

You can't go with the amount of money because, due to inflation over the years, you cannot make a meaningful comparison.

You have to go with percentage of income. The record, based on percentage of income, is held by FDR, who increased the highest tax bracket to 90%.

Interesting.
"The amount of money" was the basis for the argument against the 2001/2003 Buch tax cuts being "for the rich". Their tax rate and the % of their income was cut far less than other groups, especially those that had their taxes cut to 0.

Can't have it both ways.