Debaser - does Romney/Ryan’s plan make any of the distinctions you outline?
My understanding is it doesn’t. Do you still support it without those caveats, and with the understanding that cutting taxes this way in a revenue-neutral plan means they have to go up on earned income?
ETA: I just did quick search and it looks like Romney’s plan only cuts rates to zero for AGI under $200,000. Of course it also repeals the AMT and calls for 20% marginal rate cuts across the board (over current rates) - so I’m not really sure how the math could possibly work to make it revenue neutral.
Yeah! To hell with anyone who has a bank account. Let’s find the nearest tree and string them up!
:rolleyes:
But your silly statement actually sort of backs up what I’m saying. I’d argue that Warren Buffet “earns” his returns more than Romney, since Buffet is actively managing his empire and constantly changing it. You would make an argument that he should pay a higher tax. This would give capital gains a sense of fairness that they lack now.
Why should Warren Buffet pay the same rate as a retired worker who has his $500,000 invested in an index fund?
Yes. My first choice would be something more nuanced. But if the choice is current capital gains or zero, I choose zero.
We tax people in different ways all the time. Some states have a sales tax, some states don’t. There are plenty of ways to skin a cat.
Another good idea would be to get rid of income and capital gains altogether and do a sales tax nationally. That way, rich or poor, you only pay taxes when you spend and we encourage everyone to save. Of course, you’d need an exception for the first 50K or so to keep the half of people who don’t pay income taxes now still not paying taxes.
Romney is not being taxed on money that he has already earned. This would be the case if there was a wealth tax in place - ie if the government charged him a percentage every year of the money that he has stashed in his mattress. This does not occur.
Taxes are levied on money earned. When Romney has money in investments, he earns new money. This new, earned money is the only money that is taxed. He is not taxed on his capital investment. He is taxed on the money he makes from his capital investment. If he loses money on a capital investment, he can take a tax deduction.
On another note, I’m amused by anyone who posits that one reason not to tax dividends or interest income or capital gains is that if you eliminate these taxes, then people will invest more money, and thus create jobs.
Tell me… Is there anyone out there who has money to invest, but is keeping it under their bed in a box for the sole reason that if they invest it, they will have to pay a small amount of tax on the profits they will make from it? In other words, they are voluntarily forgoing a profit because they’ll have to give up 15% of that profit?
How about if we have them pay an appropriate tax on the income they EARN from their investment in the bank account? The same way I pay an appropriate tax on the money I EARN from working. How would that be?
And I have to say, this continual equating of “appropriate taxes should be paid on a variety of types of income” with “we hate the rich, string them up” is becoming exceedingly tiresome.
It’s not theoretically impossible that this is sometimes the case. There are risks to investment, and the extra 5-10% one might be taxed in a high versus low tax environment might make the difference between an enterprise that’s worth pursuing and one that isn’t. The downside is the same: you lose all your cash. The upside is different: you gain 5-10% less profit. That may change the equation for some people.
However, that’s in theory. In practice, at least for the past 15 years, taxes on investment profit have decreased while investment has also decreased.
The most equitable (heh) situation I see is one in which all income is considered equal, but indexed for inflation. So if I held a stock for 10 years and it has doubled, but inflation has only gone up by 50%, then when I sell it, it gets taxed as ordinary income, but the first 50% of the appreciation is ignored.
And of course the hotshot fund managers who get millions per year in short term gains would basically have to pay for it as normal income.
The downside of this is it would increase the incentive to play political games with the measurement of the inflation rate.
There’s a thousand ways you could do it in a revenue neutral way. You could implement a wealth tax, a sales tax, a sales tax just on items over 10,000 to just hit the rich, a VAT.
This is a loophole that should be closed immediately. In fact, it’s not even really a loophole, just a bunch of people basically making up a new rule as they go along and the IRS for some reason ignoring them.
Clearly the fund managers who pay cap gains instead of income tax are being compensated for their work. They aren’t investors. I have no idea why the IRS allows this but they should stop it tomorrow.
You might understand, by it’s apparent that many do not.
Putting words in other people’s mouths, supposing what they might say, is not a worthy form of debate, and lends nothing to the conversation.
And I guess if they make overseas income that should have been legally reported to the IRS, they can just take advantage of a tax amnesty later on, right?
The point is that in order to put in place these cuts in a revenue-neutral fashion new revenue has to come from somewhere. And the current proposal is to get them from removing “loopholes and deductions”, which basically means middle-class deductions like health insurance and mortgage interest. There just isn’t enough money in loopholes to get close to the kind of cuts being proposed.
I fully agree that the carried interest rules should be discarded immediately. And I’d give Romney full credit if he proposed that, since it would affect him directly. As far as I know, he has not proposed that change (Obama, on the other hand, has).
There’s no evidence anyone in this thread doesn’t understand this basic concept.
You’ve got me there!
Taking cheap shots at what might or might not be in Romney tax returns is not a worthy form of debate, and lends nothing to the conversation.
It’s true, even if you don’t like it, that rich people now are global. They own investments and companies that exist globally and they can and do move themselves and their investments to avoid high taxes. See France.
You are working off of his 2010 proposal from what I understand. He’s since released newer proposals that don’t eliminate things like capital gains taxes. According to a FactCheck article I was reading the other day the Dems are viciously attacking Ryan over earlier versions of his proposals, and deliberately ignoring the fact that they were a work in progress and that he’s continued to refine and submit the things with changes. Now, you might not like the new ones either, but they are different than the older ones, and my understanding is that he’s modified his earlier hard line stance in the face of reality. Not anywhere I can look it up right now, but I’ll see if I can dig up that FactCheck article later if you like. I realize that FactCheck is now on par with Fox News around here, but I still think it’s a valid resource for this sort of thing.
They may have been proposals that he has modified or abandoned, but nonetheless provide insight into what his philosophy is. The early proposals are what he wants to do, the later ones are bending to the political realities.