Why a wealth tax?

Some of you may have heard about proposals for a new tax on individuals called the "Wealth Tax". My question is why is this needed. If there are votes to pass a wealth tax aren't there votes to fix the tax system we already have in place which purports to do just that? Why not fix the loophole ridden gift and estate taxes as a start?

Not even sure the name of this new shiny object for the great unwashed is properly named. A quick Google search states that the amount of wealth needed to be considered wealthy is $2.4 million or 25 times the median wealth of Americans. If this is the case why start a wealth tax at $50 million as is being proposed versus $2.4 million?

So are politicians just to lazy or stupid to fix our current system. After all they can't even use the correct start point for a true tax on the wealthy.

Like most taxes it fails miserably.

With a wealth tax you incentivize people to blow their money on frivolous nonsense. The higher the rate is, the more this is encouraged. Instead of leaving it for their children to try to give them a better life. The higher the rate is, the more this is encouraged.

washunut said:

Some of you may have heard about proposals for a new tax on individuals called the "Wealth Tax". My question is why is this needed. If there are votes to pass a wealth tax aren't there votes to fix the tax system we already have in place which purports to do just that? Why not fix the loophole ridden gift and estate taxes as a start?

Not even sure the name of this new shiny object for the great unwashed is properly named. A quick Google search states that the amount of wealth needed to be considered wealthy is $2.4 million or 25 times the median wealth of Americans. If this is the case why start a wealth tax at $50 million as is being proposed versus $2.4 million?

So are politicians just to lazy or stupid to fix our current system. After all they can't even use the correct start point for a true tax on the wealthy.

Click to expand...

Wealth taxes have been tried in several European countries and failed. Most all European countries found that they didn't accomplish their goal and eliminated them.

washunut said:

Some of you may have heard about proposals for a new tax on individuals called the "Wealth Tax". My question is why is this needed. If there are votes to pass a wealth tax aren't there votes to fix the tax system we already have in place which purports to do just that? Why not fix the loophole ridden gift and estate taxes as a start?

Not even sure the name of this new shiny object for the great unwashed is properly named. A quick Google search states that the amount of wealth needed to be considered wealthy is $2.4 million or 25 times the median wealth of Americans. If this is the case why start a wealth tax at $50 million as is being proposed versus $2.4 million?

So are politicians just to lazy or stupid to fix our current system. After all they can't even use the correct start point for a true tax on the wealthy.

Click to expand...

We need a wealth tax on congress. Mr. Smith goes to Washington and leaves a millionaire on 175k while maintaining a residence in greater DC and in home district. Private schools, elite colleges for the kids.
I am thinking a modest 75% of the increase on net worth year over year. /s


Sent from my SM-G892A using Tapatalk

Democrats and Raising Taxes

The problem with Democrats / liberals is they have a real problem looking into the future to see the horrendous damage their policies do.

Do you remember when the liberals placed a 10% luxury tax on yacht sales ("get the rich")? What happened was the rich quit buying yachts, so the yacht manufacturers lost all kinds of money and the little guy who helped build the yachts got laid off. So it wasn't "get the rich," it was the liberals screwing the little guy - again.

Another prime example: The do-gooders in San Francisco decided to give $400 'welfare' checks to homeless people. Higher taxes helped pay for that. Help the poor, right? Well, next thing you know every vagrant in America (criminals too) began showing up in San Fran for a free ride. Crime went up, and the homeless were everywhere hitting on regular folks for money, etc., and engaging in criminal activities. The police finally had enough and told the libs they had to stop the madness, which they eventually did. Liberalism gone mad again.

Want to raise taxes on the corporations? Since all competitors will have their taxes raised, they’ll just raise their prices and pass it along to the little guy – the consumer. We’ll be paying the higher taxes for the corporations. The little guy gets screwed again. Or, corporations will leave America and operate out of lower tax countries. Common sense. Liberals don’t have it.

Tax the wealthy? A great many of them will move to whatever state or country gives them a better deal. Redistribute their wealth? Aryeh Spero noted, “It is America’s men and women of wealth, imbued with religious and civic responsibility, who have served as the greatest patrons of the civic infrastructure, be it hospitals, libraries, museums, the arts, or the charitable United Way. England once had those patrons, but they went away as redistribution of wealth came in.” The same thing will happen in America.

Redistribution of Wealth is, at its core, a radical left-wing economic scheme centered in greed and covetousness for other people’s money, rather than exercising personal responsibility and initiative and earning it one’s self.

Democrats…

Because Equality...

Redistribution of accumulated wealth is an ancient idea and every civilization has experienced it sooner or later. Either you do it peacefully or violently, those are the only two choices. Concepts like jubilees avoided violence and were quite effective for a long time. Then there is the proscription method, just take the money from your political enemies and kill them. Rome did this countless times. But the most common method is war. War destroys wealth and creates wealth. We believe that our era is somehow immune to the inevitability of historical precedent. But if the election of Trump tells us anything it is that we are just as prone to repeating history as any other generation. So you must ask yourself a simple question if you want to discuss a wealth tax. That question is: is income inequality increasing or decreasing the chance that the people will revolt sooner or later in a violent manner? If you answer yes, lets figure out a peaceful way to avoid it. If your answer is no, then you must believe that inequality is not a issue to consider at all.

Vadinho said:

Redistribution of accumulated wealth is an ancient idea and every civilization has experienced it sooner or later. Either you do it peacefully or violently, those are the only two choices. Concepts like jubilees avoided violence and were quite effective for a long time. Then there is the proscription method, just take the money from your political enemies and kill them. Rome did this countless times. But the most common method is war. War destroys wealth and creates wealth. We believe that our era is somehow immune to the inevitability of historical precedent. But if the election of Trump tells us anything it is that we are just as prone to repeating history as any other generation. So you must ask yourself a simple question if you want to discuss a wealth tax. That question is: is income inequality increasing or decreasing the chance that the people will revolt sooner or later in a violent manner? If you answer yes, lets figure out a peaceful way to avoid it. If your answer is no, then you must believe that inequality is not a issue to consider at all.

Click to expand...

My question isn't whether or not to tax wealth but rather the best way to do it.

For example we could fix our estate tax laws. We could adjust trust laws and Roth IRAs so that they do not skip generations. We could look at the step-up rule on assets transferred in an estate.

So there are many ways to fix the problem without a new type of tax and without killing people.

washunut said:

My question isn't whether or not to tax wealth but rather the best way to do it.

For example we could fix our estate tax laws. We could adjust trust laws and Roth IRAs so that they do not skip generations. We could look at the step-up rule on assets transferred in an estate.

So there are many ways to fix the problem without a new type of tax and without killing people.

Click to expand...

I agree. My post just reminded everyone that history teaches us this trajectory does not end well if we don't do something to head it off. Taxing wealth is already part of our normal taxation policy, its a tax on the main wealth component of the average family or citizen. Its called a property tax.

washunut said:

Some of you may have heard about proposals for a new tax on individuals called the "Wealth Tax". My question is why is this needed. If there are votes to pass a wealth tax aren't there votes to fix the tax system we already have in place which purports to do just that? Why not fix the loophole ridden gift and estate taxes as a start?

Not even sure the name of this new shiny object for the great unwashed is properly named. A quick Google search states that the amount of wealth needed to be considered wealthy is $2.4 million or 25 times the median wealth of Americans. If this is the case why start a wealth tax at $50 million as is being proposed versus $2.4 million?

So are politicians just to lazy or stupid to fix our current system. After all they can't even use the correct start point for a true tax on the wealthy.

Click to expand...

I would have to think that raising the marginal rate tax on higher incomes along with higher capital gains taxes on higher incomes would be a lot easier and more effective.

Vadinho said:

I agree. My post just reminded everyone that history teaches us this trajectory does not end well if we don't do something to head it off. Taxing wealth is already part of our normal taxation policy, its a tax on the main wealth component of the average family or citizen. Its called a property tax.

Click to expand...

Not the main component of the ultra wealthy person's wealth.

Cynical said:

I would have to think that raising the marginal rate tax on higher incomes along with higher capital gains taxes on higher incomes would be a lot easier and more effective.

Click to expand...

That gets to taxing income rather than wealth. Another area.

washunut said:

Not the main component of the ultra wealthy person's wealth.

Click to expand...

Exactly which is why it exists. It is not meant to tax the rich, it is mean to tax us. Think about deductions for a second. All of us have limits on what we can deduct. A truly wealthy person has the entire tax code available to avoid taxes. Sure they pay some amount but the tax code is there to reward and punish behavior. Dividend income is taxed differently then earned income. A loss on your home is not deductible while a person like Trump or Romney has the ability to carry forward losses indefinitely. A single person does not get the same deductions as a single parent. The tax code intends to promote this in favor of that, we get our little bones thrown to us so we will shut up. Thats basically the story.

Vadinho said:

Exactly which is why it exists. It is not meant to tax the rich, it is mean to tax us. Think about deductions for a second. All of us have limits on what we can deduct. A truly wealthy person has the entire tax code available to avoid taxes. Sure they pay some amount but the tax code is there to reward and punish behavior. Dividend income is taxed differently then earned income. A loss on your home is not deductible while a person like Trump or Romney has the ability to carry forward losses indefinitely. A single person does not get the same deductions as a single parent. The tax code intends to promote this in favor of that, we get our little bones thrown to us so we will shut up. Thats basically the story.

Click to expand...

I agree the code needs fixing. Where I do not agree is that we need yet another tax to fix it.

washunut said:

I agree the code needs fixing. Where I do not agree is that we need yet another tax to fix it.

Click to expand...

We could just agree that everyone must pay a minimum of X at income level Y and make it more progressive. We could stop giving individuals who incorporate themselves unlimited ways of avoiding taxes on profits. We could do all sorts of things to avoid further wealth inequality and a wealth tax is but one idea. I find it amusing that we once all agreed that the less you make, the less percentage we would force to to pay in taxes. We also agreed that the more you make, the more you should pay for the marginal dollar earned. Now it seems as if we have canonized the wealthy, made them into Gods worthy of special consideration because these Gods might, just might, give us a job or write a book telling us all how to become filthy rich. We even elected one such person and another one is buying his way into the nomination. At this point, the wealthy have completely replaced our old heroes and leaders, none of us know who the poet laureate is anymore. Do we celebrate a play writer or author as we once did? A scientist is now mocked, a professor is called a communist, philosophers and artists are non-existent in the national media landscape. But we do know who our most wealthy are, we get that Forbes list every year.

washunut said:

That gets to taxing income rather than wealth. Another area.

Click to expand...

Capital gains (i.e. stock value) is where the ultra wealthy have their wealth. Their wealth is not just sitting in bank collecting 1% interest.

Cynical said:

Capital gains (i.e. stock value) is where the ultra wealthy have their wealth. Their wealth is not just sitting in bank collecting 1% interest.

Click to expand...

Capital gains are only owed when you sell a stock. So Buffett sits on his Berkshire stock as does Gates,Bezos etc. The real wealth is not in trading stocks but holding them.

washunut said:

Capital gains are only owed when you sell a stock. So Buffett sits on his Berkshire stock as does Gates,Bezos etc. The real wealth is not in trading stocks but holding them.

Click to expand...

In order to get money they periodically have to sell shares of their stock.

Cynical said:

In order to get money they periodically have to sell shares of their stock.

Click to expand...

Yes but people like Buffett and Gates give enough to charity that most of their gains are offset by charitable contribution deductions.

Vadinho said:

Exactly which is why it exists. It is not meant to tax the rich, it is mean to tax us. Think about deductions for a second. All of us have limits on what we can deduct. A truly wealthy person has the entire tax code available to avoid taxes. Sure they pay some amount but the tax code is there to reward and punish behavior. Dividend income is taxed differently then earned income. A loss on your home is not deductible while a person like Trump or Romney has the ability to carry forward losses indefinitely. A single person does not get the same deductions as a single parent. The tax code intends to promote this in favor of that, we get our little bones thrown to us so we will shut up. Thats basically the story.

Click to expand...

This post here shows complete disregard for actual knowledge so lets handle this one thing at a time.

on dividends.

Ordinary dividends and qualified dividends each have different tax rates:

Ordinary dividends are taxed as ordinary income.
Qualified dividends are taxed at a 20%, 15%, or a 0% rate,

So it depends on the type of dividend you get depends on how it is taxed.
It also depends on the amount of dividend you receive.

You can deduct the loss of a property sale if you convert it to a rental property before you sale it and it sales for lower than the amount.
Real estate developers and investments get the same deductions of other capital investments.

Why should they get the same deductions as a single parent?
if they had a kid they would get the same deductions.

All people have access to the same deductions as long as you qualify for them.

ludin said:

This post here shows complete disregard for actual knowledge so lets handle this one thing at a time.

on dividends.

Ordinary dividends and qualified dividends each have different tax rates:

Ordinary dividends are taxed as ordinary income.
Qualified dividends are taxed at a 20%, 15%, or a 0% rate,

So it depends on the type of dividend you get depends on how it is taxed.
It also depends on the amount of dividend you receive.

You can deduct the loss of a property sale if you convert it to a rental property before you sale it and it sales for lower than the amount.
Real estate developers and investments get the same deductions of other capital investments.

Why should they get the same deductions as a single parent?
if they had a kid they would get the same deductions.

All people have access to the same deductions as long as you qualify for them.

Click to expand...

I am well aware of the points you raised, they do not change the idea I was promoting which is that the tax code specifically gives some incomes and some losses more or less advantage then others. When you say it is available to all, that is true theoretically. If I had a rental property I could treat it as a business and enjoy more benefits from the tax code then I do today. The majority of us do not own rental properties, we own our homes. Now why would a loss on my home be treated differently then a loss on a rental? I think we all know the reason, landlords created the tax code associated with these tax breaks. As for dividends, the Bush 2 administration decided to change the tax laws giving some dividends preferential tax breaks. It was sold as double taxation since the stock owner also theoretically paid a tax on profits on the income statement of the corporation. Great excuse to give a very, very small percentage of stock owners another tax break. My point about the child credit is that it exists to promote a desired value or outcome, a family. What if we decided to include other such situations in the same preferential manner? For instance, a tipped server makes nothing in wages really. Tips used to go untaxed until Ronnie decided servers were ripping him off. Fine. But we could change that too if we decided that having tipped wages on sub-minimum wage jobs was a good thing for the economy and gave them a break too. The tax code is a reflection of what we think is important, but the "we" is more likely to be the rich then the poor especially when the Republicans are in charge of the tax code

Vadinho said:

Redistribution of accumulated wealth is an ancient idea and every civilization has experienced it sooner or later. Either you do it peacefully or violently, those are the only two choices. Concepts like jubilees avoided violence and were quite effective for a long time. Then there is the proscription method, just take the money from your political enemies and kill them. Rome did this countless times. But the most common method is war. War destroys wealth and creates wealth. We believe that our era is somehow immune to the inevitability of historical precedent. But if the election of Trump tells us anything it is that we are just as prone to repeating history as any other generation. So you must ask yourself a simple question if you want to discuss a wealth tax. That question is: is income inequality increasing or decreasing the chance that the people will revolt sooner or later in a violent manner? If you answer yes, lets figure out a peaceful way to avoid it. If your answer is no, then you must believe that inequality is not a issue to consider at all.

Click to expand...

subsidizing dependency increases it.

TurtleDude said:

subsidizing dependency increases it.

Click to expand...

Well, the rich then represent a very large subsidized dependent class along with corporations. The question for me is what exactly do you want the tax code to do for the vast majority of us? I would argue that if tax reduction works for the big guy, it works even better for the little guy. What is missing from the national debate about this all is the nature of fiscal policy as it relates to fiat money and a fractional reserve banking system. The truth is that we do no need tax revenues to spend government money. We are running up deficits as far as the eye can see and yet this month the Fed came out worrying that the inflation target should be higher, we simply do not have enough inflation for them to raise rates or have room to manoever if a recession hits. As long as we are giving out tax breaks, why not give all of us more so we can retire personal debt? Trump doesn't need a tax break, my daughter who made 30 grand does.

Cynical said:

In order to get money they periodically have to sell shares of their stock.

Click to expand...

and that is when a tax vests. Assholes Like Warren want to tax the wealth before there is any gain realized. Its malignant and parasitic

Vadinho said:

Well, the rich then represent a very large subsidized dependent class along with corporations. The question for me is what exactly do you want the tax code to do for the vast majority of us? I would argue that if tax reduction works for the big guy, it works even better for the little guy. What is missing from the national debate about this all is the nature of fiscal policy as it relates to fiat money and a fractional reserve banking system. The truth is that we do no need tax revenues to spend government money. We are running up deficits as far as the eye can see and yet this month the Fed came out worrying that the inflation target should be higher, we simply do not have enough inflation for them to raise rates or have room to manoever if a recession hits. As long as we are giving out tax breaks, why not give all of us more so we can retire personal debt? Trump doesn't need a tax break, my daughter who made 30 grand does.

Click to expand...

you're mistaken. The rich pay far more of the taxes than they use in government services. Even with all the breaks you claim the rich get-the top one percent are paing around 40% of the federal income taxes but certainly don't use 40% of the government spending nor do they make 40% of the income. The real tax breaks are for people who enjoy full citizenship and voting rights but don't pay much in the way of federal taxes for those federal benefits.