Author Topic: Tax the rich  (Read 1734 times)

0 Members and 1 Guest are viewing this topic.

Offline Kenkoko

  • O.C. Resident
  • ***
  • Thanks
  • -Given: 178
  • -Received: 284
  • Posts: 951
Re: Tax the rich
« Reply #15 on: June 17, 2021, 01:03:39 AM »
Sadly, Katie Porter, our representative is flogging this drum too.  I know she knows better. 

https://www.propublica.org/article/the-secret-irs-files-trove-of-never-before-seen-records-reveal-how-the-wealthiest-avoid-income-tax

The rich pay nothing, honestly, the gall given they show a table with Bezos paying $900 million+ in taxes.  Musk nearly $500 million.

Oh, compared to their unrealized capital gains of stock ownership… drivel.

I'm not for the wealth tax because it's an inefficient way to tax. More importantly, the wealth tax was already tried in European countries and ended up getting repealed. (primarily due to inability to generate anywhere close to the projected revenue)

But, I understand the people's desire for a wealth tax.

We do live in a country where everyone knows that billionaires and mega corporations have huge tax advantages and utilize loopholes. And white collar criminals almost never go to jail.

Yet the 99% cannot get together to do anything about it. Hence the public frustration.

It's only natural for politicians to recognize it and run with it. Especially when much of the voting public is ill-informed on how practical the wealth tax really is.

Offline freedomcm

  • O.C. Resident
  • ***
  • Thanks
  • -Given: 485
  • -Received: 104
  • Posts: 713
Re: Tax the rich
« Reply #16 on: June 17, 2021, 06:51:17 AM »
VAT are hugely regressive.  Rich people don't buy stuff that is taxed in proportion to their income or wealth (they buy properties or companies).  It hits the middle class very hard, since it is a sales tax with few exemptions for necessities like food or medicines.

Perhaps we should find a solution for how we can tax the following even though they never sold...

2014 - Warren owns $20,000,000,000 in stock
2018 - Warren owns $54,300,000,000 in stock

2014 - Elon Musk owns $2,000,000,000 in stock
2018 - Elon Musk owns $15,900,000,000 in stock

How can you tax someone if they never sell their capital?


It's sort of like me never selling any house I own in CA due to prop 13.

The answer is VAT, a consumption tax.

It's kind of wild that the US has not figured this out.

Every other developed country in the world already figured this out. USA is the only developed country in the world without a Value Added Tax.

With a VAT in place, companies like Amazon has to pay a toll for every transaction regardless of whether Amazon made any profit.

And when Musk & Bezo spend billions buying rockets to Mars, they also get hit with a VAT too.  :)

Online nosuchreality

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 151
  • -Received: 547
  • Posts: 2600
Re: Tax the rich
« Reply #17 on: June 17, 2021, 08:09:19 AM »
VAT are hugely regressive.  Rich people don't buy stuff that is taxed in proportion to their income or wealth (they buy properties or companies).  It hits the middle class very hard, since it is a sales tax with few exemptions for necessities like food or medicines.

Perhaps we should find a solution for how we can tax the following even though they never sold...

2014 - Warren owns $20,000,000,000 in stock
2018 - Warren owns $54,300,000,000 in stock

2014 - Elon Musk owns $2,000,000,000 in stock
2018 - Elon Musk owns $15,900,000,000 in stock

How can you tax someone if they never sell their capital?


It's sort of like me never selling any house I own in CA due to prop 13.

The answer is VAT, a consumption tax.

It's kind of wild that the US has not figured this out.

Every other developed country in the world already figured this out. USA is the only developed country in the world without a Value Added Tax.

With a VAT in place, companies like Amazon has to pay a toll for every transaction regardless of whether Amazon made any profit.

And when Musk & Bezo spend billions buying rockets to Mars, they also get hit with a VAT too.  :)

The answer is simple, property tax.  Anything with a title and all financial instruments.

Offline Kenkoko

  • O.C. Resident
  • ***
  • Thanks
  • -Given: 178
  • -Received: 284
  • Posts: 951
Re: Tax the rich
« Reply #18 on: June 17, 2021, 08:10:17 AM »
VAT are hugely regressive.  Rich people don't buy stuff that is taxed in proportion to their income or wealth (they buy properties or companies).  It hits the middle class very hard, since it is a sales tax with few exemptions for necessities like food or medicines.

That's unfortunately a manufactured talking point by the left in the US.

In theory, a flat and untailored VAT can be regressive. But almost no country does that.

I asked this of all my friends on the left and never got any good answers -

If the VAT is so regressive, then why do all the progressive Nordic countries have VAT?
Bernie Sander often touts how progressive the Nordic countries are. So why do they have some of the highest VAT % in the world if the VAT is so regressive?

The progressive Nordic countries exempt VAT on most consumer staples, food, diapers etc. They run up the VAT % on luxury goods like 200% on Yachts, luxury watches etc

Offline Kenkoko

  • O.C. Resident
  • ***
  • Thanks
  • -Given: 178
  • -Received: 284
  • Posts: 951
Re: Tax the rich
« Reply #19 on: June 17, 2021, 08:12:34 AM »
The answer is simple, property tax.  Anything with a title and all financial instruments.

With all due respect, No

It's mind boggling to me why we don't simply follow what has worked in every other developed country and adopt a VAT. It's proven to work and is an efficient way to tax.

Why keep trying to invent the wheel?

Online nosuchreality

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 151
  • -Received: 547
  • Posts: 2600
Re: Tax the rich
« Reply #20 on: June 17, 2021, 09:10:58 AM »
The answer is simple, property tax.  Anything with a title and all financial instruments.

With all due respect, No

It's mind boggling to me why we don't simply follow what has worked in every other developed country and adopt a VAT. It's proven to work and is an efficient way to tax.

Why keep trying to invent the wheel?

Wealth taxes have worked since the beginning of civilization.

The Nordic countries had wealth taxes until the 80s and 90s. While the Nordic countries lead in the income equality, they are experiencing rapid increases in inequality since abolishing and lead the OECD countries in this growth on GENI and other inequality measures. 

In other words, the current Nordic model is undoing the equality you seek and creating the inequality you want to mitigate.

The Nordic countries also have another dirty secret that progressives will absolutely hate, every one pays high taxes.  Sweden for example has it's top bracket kick in at kr537K . The average salary in Sweden is kr547K.

The solution that the successful capitalist democracies have is that every one has skin in the taxation game. 


The following member(s) thanked this post:


Offline woodburyowner

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 69
  • -Received: 158
  • Posts: 1066
Re: Tax the rich
« Reply #21 on: June 17, 2021, 09:14:10 AM »
Instituting a VAT tax will be spun as a tax on the poor.  The poor will end up paying more total tax with VAT than w/ the current system since they pay no/little federal income tax (most even end up with tax credits).

Offline eyephone

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 493
  • -Received: 777
  • Posts: 14410
Re: Tax the rich
« Reply #22 on: June 17, 2021, 09:34:07 AM »
Just get rid of the ridiculous tax loopholes.


Offline Kenkoko

  • O.C. Resident
  • ***
  • Thanks
  • -Given: 178
  • -Received: 284
  • Posts: 951
Re: Tax the rich
« Reply #23 on: June 17, 2021, 09:42:12 AM »
@NSR While I agree with some of your points, I'm not hearing a compelling case of why not. (for VAT)

The wealth tax was ditched because of the mechanism is too easy to game for the wealthy. Like property tax, the taxing mechanism for wealth tax rely on properly assessing "value". It's extremely difficult to do, heavily favors the wealthy, and the tax is costly to administer which all lead to the failure of the wealth tax.

What makes VAT valuable and essential is the mechanism. It takes a toll on all business transactions, regardless of profit. Businesses cannot wiggle out of it by claiming they were not profitable. (what Amazon and every other mega corps claim to reduce tax burdens)

I agree that the secret to success is to make it so everyone has skin in the game.

@woodburyowner

Agree it will be spun as taxing on the poor. Which is why I support a basic income funded by VAT proposed by Andrew Yang.

Offline eyephone

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 493
  • -Received: 777
  • Posts: 14410
Re: Tax the rich
« Reply #24 on: June 17, 2021, 10:31:36 AM »
Just get rid of the ridiculous tax loopholes.


Just a guess/assumption. It is not common for a person not to take a salary and take a loan from the stock options value. Then deduct the stock options loan interest.

This is what makes people riled up and angry. (Believe me, it does)


Offline woodburyowner

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 69
  • -Received: 158
  • Posts: 1066
Re: Tax the rich
« Reply #25 on: June 17, 2021, 02:23:02 PM »
Just get rid of the ridiculous tax loopholes.


Couple of points that no one seems to discuss is mentioned in this video.  His income is "lumpy" meaning he DOES pay taxes in some years and other years he doesn't.  It's structured this way obviously for tax purposes.  Would there be such an uproar if say he paid $100M in taxes in each year 2015, 2016 and 2017?  In his case, he might have paid 0 taxes in 2015 and 2016, but paid $300M in taxes 2017.  We need to see all the years before and after the "0" year. 

Also, he is not taking "income".  Federal income tax has the word "income" in it.  Borrowing capital against an asset is not "income".  Why should he be paying income tax on it? 

I think the real discussion should be surrounding the death step up tax basis rule.

Online nosuchreality

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 151
  • -Received: 547
  • Posts: 2600
Re: Tax the rich
« Reply #26 on: June 17, 2021, 03:03:12 PM »
Just get rid of the ridiculous tax loopholes.



Couple of points that no one seems to discuss is mentioned in this video.  His income is "lumpy" meaning he DOES pay taxes in some years and other years he doesn't.  It's structured this way obviously for tax purposes.  Would there be such an uproar if say he paid $100M in taxes in each year 2015, 2016 and 2017?  In his case, he might have paid 0 taxes in 2015 and 2016, but paid $300M in taxes 2017.  We need to see all the years before and after the "0" year. 

Also, he is not taking "income".  Federal income tax has the word "income" in it.  Borrowing capital against an asset is not "income".  Why should he be paying income tax on it? 

I think the real discussion should be surrounding the death step up tax basis rule.


Kind of neat the way the tell you $0 in 2018 and point out less than $70K in taxes in 2015 and 2017 while being completely mum on having $1.34B in income in 2016 and paying $424 Million in taxes that year for 31.6% effective tax rate.

For comparison, a married couple with two kids under 18 making $100K a year pay $4500 a year.  That's just straight standard deduction, child tax credit and all W2 income.  Effective rate 4.5%.


Offline eyephone

  • Certified Irvine Addict
  • ****
  • Thanks
  • -Given: 493
  • -Received: 777
  • Posts: 14410
Re: Tax the rich
« Reply #27 on: June 17, 2021, 04:30:40 PM »
Just get rid of the ridiculous tax loopholes.


Couple of points that no one seems to discuss is mentioned in this video.  His income is "lumpy" meaning he DOES pay taxes in some years and other years he doesn't.  It's structured this way obviously for tax purposes.  Would there be such an uproar if say he paid $100M in taxes in each year 2015, 2016 and 2017?  In his case, he might have paid 0 taxes in 2015 and 2016, but paid $300M in taxes 2017.  We need to see all the years before and after the "0" year. 

Also, he is not taking "income".  Federal income tax has the word "income" in it.  Borrowing capital against an asset is not "income".  Why should he be paying income tax on it? 

I think the real discussion should be surrounding the death step up tax basis rule.

He is not getting a salary, but he is taking a loan from the value of his stop options for his expenses, according to the cnbc video mentioned above. Then writing off the interest expense of the loan.

Offline sleepy5136

  • Yearning for 949 / 714
  • **
  • Thanks
  • -Given: 4
  • -Received: 34
  • Posts: 389
Re: Tax the rich
« Reply #28 on: June 22, 2021, 07:38:23 PM »
Just get rid of the ridiculous tax loopholes.

Musk is genius.

 

Talk Irvine Links

[Recent Posts]
[FAQ / Rules]

Site Supporters


Recent Posts

SimplePortal 2.3.7 © 2008-2021, SimplePortal