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Old 09-02-2019, 01:05 PM
Wrenching Spanners is offline
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Join Date: Jun 2011
Location: London
Posts: 538
Quote:
Originally Posted by Ludovic View Post
Speaking for myself:

There's nothing special about a majority.
The majority is the point where I'm retaining more of my income than the government is taking. I don't believe I should be paying miniscule taxes, but I think that every person, regardless of their level of income, is entitled to a greater share of their income than the government.

Quote:
Originally Posted by Ludovic View Post
We already have a wealth tax. I don't see anything special about liquid assets as opposed to real estate. Unless we can eliminate the real estate tax which disproportionately hits the upper middle and lower upper classes, I don't see a moral issue with doing the same for the ultrawealthy's equities.
While I recognise it's not a mainstream view, I'm personally opposed to property taxes. For one reason, the asset value of the property isn't a measure of the wealth of the owner. If person A buys a property with cash, and person B takes out a 90% mortgage, person A has much more property wealth than person B, but they pay the same property tax. Person C buys shares instead of a property, and person D buys a Bugatti. Neither pay property tax. You can try and level the field by taxing equities and creating a luxury tax, but you're ultimately going to be punishing savers and investors rather than spenders.

Quote:
Originally Posted by Ludovic View Post
Depends on what you mean by "meaningful". A tax increase on the ultrawealthy will not cure the deficit, but it would meaningfully reduce it. I agree that to solve American budget issues you do need to expand the tax increases beyond the ultrawealthy.
I don't feel like doing the math at the moment (maybe later), but suppose we define the rich as the top 1% of income earners, and set an income tax threshold at the level where the 99% top out. Suppose we raise the tax rate of this threshold by 5% over the next lower tax band. We're getting an increase of 10's of billions of government revenue, which I'm sure would be helpful. However, against a 4.75 trillion budget, we're only paying for 1%-2% of that budget. And this is working at the highest margins of income above threshold. Expanding the definition of the rich to the top 2% is not going to double those 10's of billions of government revenue. It would probably be a 10-20% rise. Each time we increase your percentage of what qualifies as rich, we're getting a lower margin of income above threshold. At a guess, to achieve a tax revenue increase of 5% of that 4.75 trillion budget, we'd have to increase taxes on the top 10% of income earners. At that point, we're hitting far more than the ultra-wealthy and we're hitting the upper middle class earners. That might be a reasonable fiscal decision, but we're not going to get huge government tax revenue increases by only going after the super-rich.