[Moderating]
A reminder: This GQ thread is about the mechanics by which a 100% tax rate could be implemented. It is not about the wisdom of such a tax rate, or its likely effects. Those would both be topics for GD (though I doubt that either would be much debated).
Several of us have explained the mechanics of how a 100% tax rate would work. There doesn’t seem to be much more to be said on that topic. So why not let us have a discussion on the effects and wisdom?
You can have such a discussion. Just have it in the appropriate forum.
The surgeon may stop at $1M net income. I’m assuming tax on net, because 100% tax on gross is even stupider than 100% tax. He’ll take partners, or the overflow will go to others. His take-home would stay the same.
Like the corporate jet example, he may feel generous and simply pay his staff more, gussy up the office, put a big screen in the waiting room, etc.
There wouldn’t be a shortage of money - the key point with money is “velocity” - how fast do you spend what you earn so it becomes income for someone else? Besides, how much of someone’s extra over $1M goes into general circulation, compared to what the general population earns?
not mentioned in all this is the progressive tax element. Presumably if there’s 100% at $1M there’s high tax brackets all the way - so say, the last 1/4M is taxed at 75%, $500,000 to $750,000 at 60%, etc. the disincentive to earn more will be felt long before hitting the 100% wall. If, say, you only get to keep 10% of your last $100,000 why even bother? This is where as I suggested earlier creative business expenses become a factor. can you really forbid business conferences from being held in Tahiti or Bali?