Taxes!

[CA renter]

We should not discourage work or labor through a graduated income tax…we should tax people based on the luxuries that money provides.

It is simply unjust tax labor more than other forms of income. It picks favorites among revenue sources.
—————-

You’re right, we should not discourage work and labor. The problem is that those with the highest incomes rarely work or labor. Most of their income is passive/investment income.

IMHO, we need to discourage gambling and encourage work. That’s why I would lower the rate on **earned** income, and tax investment income at a much higher rate, with steeply progressive rates.

I would not support a consumption tax, because it’s too regressive. Most poor people spend almost all of their income on basic necessities, while the rich can invest theirs. It would be totally immoral and unethical to tax gamblers at 0-15%, while taxing poor people at the maximum rate (if consumption tax is the highest tax).

[jstoesz]

CAR…I agree and disagree.

I do not buy the argument that lower income earners spend more of there money by percentage and save less equates to a regressive tax. I think that this is a bit of twist of logic or spin. Just because some save more than others does not amount to a regressive tax.

I understand your base concern, and I think it is valid.

I agree that we need support for lower earners. That is the place for the public dole, in my opinion ( and all the policy initiative spin offs related). The bottom should be supported.

I don’t think that investment is the same thing as gambling…although the banking industry is certainly stretching my understanding.

[jstoesz]

CAR…I agree and disagree.

I do not buy the argument that lower income earners spend more of there money by percentage and save less equates to a regressive tax. I think that this is a bit of twist of logic or spin. Just because some save more than others does not amount to a regressive tax.

I understand your base concern, and I think it is valid.

I agree that we need support for lower earners. That is the place for the public dole, in my opinion ( and all the policy initiative spin offs related). The bottom should be supported.

I don’t think that investment is the same thing as gambling…although the banking industry is certainly stretching my understanding.

[jstoesz]

CAR…I agree and disagree.

I do not buy the argument that lower income earners spend more of there money by percentage and save less equates to a regressive tax. I think that this is a bit of twist of logic or spin. Just because some save more than others does not amount to a regressive tax.

I understand your base concern, and I think it is valid.

I agree that we need support for lower earners. That is the place for the public dole, in my opinion ( and all the policy initiative spin offs related). The bottom should be supported.

I don’t think that investment is the same thing as gambling…although the banking industry is certainly stretching my understanding.

[jstoesz]

CAR…I agree and disagree.

I do not buy the argument that lower income earners spend more of there money by percentage and save less equates to a regressive tax. I think that this is a bit of twist of logic or spin. Just because some save more than others does not amount to a regressive tax.

I understand your base concern, and I think it is valid.

I agree that we need support for lower earners. That is the place for the public dole, in my opinion ( and all the policy initiative spin offs related). The bottom should be supported.

I don’t think that investment is the same thing as gambling…although the banking industry is certainly stretching my understanding.

[jstoesz]

CAR…I agree and disagree.

I do not buy the argument that lower income earners spend more of there money by percentage and save less equates to a regressive tax. I think that this is a bit of twist of logic or spin. Just because some save more than others does not amount to a regressive tax.

I understand your base concern, and I think it is valid.

I agree that we need support for lower earners. That is the place for the public dole, in my opinion ( and all the policy initiative spin offs related). The bottom should be supported.

I don’t think that investment is the same thing as gambling…although the banking industry is certainly stretching my understanding.

[Eugene]

[quote]IMHO, we need to discourage gambling and encourage work. That’s why I would lower the rate on **earned** income, and tax investment income at a much higher rate, with steeply progressive rates.

I would not support a consumption tax, because it’s too regressive. Most poor people spend almost all of their income on basic necessities, while the rich can invest theirs. It would be totally immoral and unethical to tax gamblers at 0-15%, while taxing poor people at the maximum rate (if consumption tax is the highest tax).[/quote]

Agreed. VAT only makes sense if you exempt basic necessities, or compensate with a generous tax refund (say, 10% for every dollar earned up to median household income).

Instead I’d suggest that we eliminate mortgage tax deduction, tax all capital gains as income, raise the estate tax to 50% on every dollar above $500,000, close all loopholes and subsidies in corporate tax code, and lower income tax brackets to make the system revenue-neutral.

[quote]We should encourage saving, so people can make intelligent decisions about investment in the future. [/quote]

I’m not so sure that we should encourage saving. Sometimes too much private saving is a bad thing. (Like right now, for example.) And we certainly shouldn’t do it by lowering taxes on capital gains. All it does is inflate P/E ratios of the stock market, with no tangible benefits for the overall economy.

But we should encourage labor vs. passive investment. It would make sense for the top income tax rate to be equal or lower than the capital gains rate.

[Eugene]

[quote]IMHO, we need to discourage gambling and encourage work. That’s why I would lower the rate on **earned** income, and tax investment income at a much higher rate, with steeply progressive rates.

I would not support a consumption tax, because it’s too regressive. Most poor people spend almost all of their income on basic necessities, while the rich can invest theirs. It would be totally immoral and unethical to tax gamblers at 0-15%, while taxing poor people at the maximum rate (if consumption tax is the highest tax).[/quote]

Agreed. VAT only makes sense if you exempt basic necessities, or compensate with a generous tax refund (say, 10% for every dollar earned up to median household income).

Instead I’d suggest that we eliminate mortgage tax deduction, tax all capital gains as income, raise the estate tax to 50% on every dollar above $500,000, close all loopholes and subsidies in corporate tax code, and lower income tax brackets to make the system revenue-neutral.

[quote]We should encourage saving, so people can make intelligent decisions about investment in the future. [/quote]

I’m not so sure that we should encourage saving. Sometimes too much private saving is a bad thing. (Like right now, for example.) And we certainly shouldn’t do it by lowering taxes on capital gains. All it does is inflate P/E ratios of the stock market, with no tangible benefits for the overall economy.

But we should encourage labor vs. passive investment. It would make sense for the top income tax rate to be equal or lower than the capital gains rate.

[Eugene]

[quote]IMHO, we need to discourage gambling and encourage work. That’s why I would lower the rate on **earned** income, and tax investment income at a much higher rate, with steeply progressive rates.

I would not support a consumption tax, because it’s too regressive. Most poor people spend almost all of their income on basic necessities, while the rich can invest theirs. It would be totally immoral and unethical to tax gamblers at 0-15%, while taxing poor people at the maximum rate (if consumption tax is the highest tax).[/quote]

Agreed. VAT only makes sense if you exempt basic necessities, or compensate with a generous tax refund (say, 10% for every dollar earned up to median household income).

Instead I’d suggest that we eliminate mortgage tax deduction, tax all capital gains as income, raise the estate tax to 50% on every dollar above $500,000, close all loopholes and subsidies in corporate tax code, and lower income tax brackets to make the system revenue-neutral.

[quote]We should encourage saving, so people can make intelligent decisions about investment in the future. [/quote]

I’m not so sure that we should encourage saving. Sometimes too much private saving is a bad thing. (Like right now, for example.) And we certainly shouldn’t do it by lowering taxes on capital gains. All it does is inflate P/E ratios of the stock market, with no tangible benefits for the overall economy.

But we should encourage labor vs. passive investment. It would make sense for the top income tax rate to be equal or lower than the capital gains rate.

[Eugene]

[quote]IMHO, we need to discourage gambling and encourage work. That’s why I would lower the rate on **earned** income, and tax investment income at a much higher rate, with steeply progressive rates.

I would not support a consumption tax, because it’s too regressive. Most poor people spend almost all of their income on basic necessities, while the rich can invest theirs. It would be totally immoral and unethical to tax gamblers at 0-15%, while taxing poor people at the maximum rate (if consumption tax is the highest tax).[/quote]

Agreed. VAT only makes sense if you exempt basic necessities, or compensate with a generous tax refund (say, 10% for every dollar earned up to median household income).

Instead I’d suggest that we eliminate mortgage tax deduction, tax all capital gains as income, raise the estate tax to 50% on every dollar above $500,000, close all loopholes and subsidies in corporate tax code, and lower income tax brackets to make the system revenue-neutral.

[quote]We should encourage saving, so people can make intelligent decisions about investment in the future. [/quote]

I’m not so sure that we should encourage saving. Sometimes too much private saving is a bad thing. (Like right now, for example.) And we certainly shouldn’t do it by lowering taxes on capital gains. All it does is inflate P/E ratios of the stock market, with no tangible benefits for the overall economy.

But we should encourage labor vs. passive investment. It would make sense for the top income tax rate to be equal or lower than the capital gains rate.

[Eugene]

[quote]IMHO, we need to discourage gambling and encourage work. That’s why I would lower the rate on **earned** income, and tax investment income at a much higher rate, with steeply progressive rates.

I would not support a consumption tax, because it’s too regressive. Most poor people spend almost all of their income on basic necessities, while the rich can invest theirs. It would be totally immoral and unethical to tax gamblers at 0-15%, while taxing poor people at the maximum rate (if consumption tax is the highest tax).[/quote]

Agreed. VAT only makes sense if you exempt basic necessities, or compensate with a generous tax refund (say, 10% for every dollar earned up to median household income).

Instead I’d suggest that we eliminate mortgage tax deduction, tax all capital gains as income, raise the estate tax to 50% on every dollar above $500,000, close all loopholes and subsidies in corporate tax code, and lower income tax brackets to make the system revenue-neutral.

[quote]We should encourage saving, so people can make intelligent decisions about investment in the future. [/quote]

I’m not so sure that we should encourage saving. Sometimes too much private saving is a bad thing. (Like right now, for example.) And we certainly shouldn’t do it by lowering taxes on capital gains. All it does is inflate P/E ratios of the stock market, with no tangible benefits for the overall economy.

But we should encourage labor vs. passive investment. It would make sense for the top income tax rate to be equal or lower than the capital gains rate.

[UCGal]

[quote=jstoesz]
My personal favorite it to get rid of the income, payroll tax, and corporate income tax etc. and replace it with only a consumption tax like the european VAT applied to all levels of spending corporate and individual equally.
[/quote]

Some questions on how this would work for corporations and families:
– would the cost of labor be taxed… Most corporations spend a good deal on salaries, benefits… would this be taxed? (This is a huge paradigm shift – pretty much the opposite of the current taxation where these costs reduced the taxable income.) Buying new equipment or building a new factory – would that be taxed?
– would *everything* you buy be taxed. So if I buy a CD or a savings bond or a share of stock – it’s taxed. If I buy a house, it’s taxed. If I buy a cup of coffee, or a plane ticket, it’s taxed? How about paying tax on my utilies… since that’s consumption too.

It’s an interesting idea… as long as it’s applied uniformly… but somehow I don’t see this EVERY happening. There would be exclusions for some things, and not for others. I just don’t see how this could ever happen in a fair, consistent manner.

[UCGal]

[quote=jstoesz]
My personal favorite it to get rid of the income, payroll tax, and corporate income tax etc. and replace it with only a consumption tax like the european VAT applied to all levels of spending corporate and individual equally.
[/quote]

Some questions on how this would work for corporations and families:
– would the cost of labor be taxed… Most corporations spend a good deal on salaries, benefits… would this be taxed? (This is a huge paradigm shift – pretty much the opposite of the current taxation where these costs reduced the taxable income.) Buying new equipment or building a new factory – would that be taxed?
– would *everything* you buy be taxed. So if I buy a CD or a savings bond or a share of stock – it’s taxed. If I buy a house, it’s taxed. If I buy a cup of coffee, or a plane ticket, it’s taxed? How about paying tax on my utilies… since that’s consumption too.

It’s an interesting idea… as long as it’s applied uniformly… but somehow I don’t see this EVERY happening. There would be exclusions for some things, and not for others. I just don’t see how this could ever happen in a fair, consistent manner.

[UCGal]

[quote=jstoesz]
My personal favorite it to get rid of the income, payroll tax, and corporate income tax etc. and replace it with only a consumption tax like the european VAT applied to all levels of spending corporate and individual equally.
[/quote]

Some questions on how this would work for corporations and families:
– would the cost of labor be taxed… Most corporations spend a good deal on salaries, benefits… would this be taxed? (This is a huge paradigm shift – pretty much the opposite of the current taxation where these costs reduced the taxable income.) Buying new equipment or building a new factory – would that be taxed?
– would *everything* you buy be taxed. So if I buy a CD or a savings bond or a share of stock – it’s taxed. If I buy a house, it’s taxed. If I buy a cup of coffee, or a plane ticket, it’s taxed? How about paying tax on my utilies… since that’s consumption too.

It’s an interesting idea… as long as it’s applied uniformly… but somehow I don’t see this EVERY happening. There would be exclusions for some things, and not for others. I just don’t see how this could ever happen in a fair, consistent manner.

[UCGal]

[quote=jstoesz]
My personal favorite it to get rid of the income, payroll tax, and corporate income tax etc. and replace it with only a consumption tax like the european VAT applied to all levels of spending corporate and individual equally.
[/quote]

Some questions on how this would work for corporations and families:
– would the cost of labor be taxed… Most corporations spend a good deal on salaries, benefits… would this be taxed? (This is a huge paradigm shift – pretty much the opposite of the current taxation where these costs reduced the taxable income.) Buying new equipment or building a new factory – would that be taxed?
– would *everything* you buy be taxed. So if I buy a CD or a savings bond or a share of stock – it’s taxed. If I buy a house, it’s taxed. If I buy a cup of coffee, or a plane ticket, it’s taxed? How about paying tax on my utilies… since that’s consumption too.

It’s an interesting idea… as long as it’s applied uniformly… but somehow I don’t see this EVERY happening. There would be exclusions for some things, and not for others. I just don’t see how this could ever happen in a fair, consistent manner.

[Author]

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