I think the tax rates on the highest incomes needs to be higher than it is - I’m not sure it needs to be 50%, but Bill Clinton’s tax rates seemed close to correct for balancing the budget.
But it grinds my grackles that the lottery, which is a fucking cash cow for the states - each dollar taken in pays out 50 cents - is then taxed as income by the feds. Casinos pay out more than 90 cents on the dollar.
If anyone should be taxed on state lotteries, it should be the states. In other words, I think the feds should get cut in on the action. You run a lottery that makes 100% profit, then you owe some to the feds.
A little injection of reality to counter some of the utter nonsense that some are spinning …
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[li]First, the premise of the OP is flat-out wrong. Sanders made no such statement, and proposed no such tax.[/li][/ul]
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[li]Second, with respect to Sanders’ alleged “socialism”, I’m not aware of anything that Sanders has proposed that isn’t already in effect throughout western Europe, Canada, and most modern civilized democracies – things like progressive taxation, a strong social safety net, and universal health care. And the Canadian economy has done just fine over the years, thank you for asking, contrary to right-wing prognostications of communistic doom. In fact, it survived the 2008-09 recession far better than the US economy did, taking a mere 4% hit to the GDP as compared to 20% in the US, and it also outperformed the US economy in some of the subsequent years.[/li][/ul]
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[li]Third, I wonder if the OP knows what the tax rate is on lottery winnings in “socialist” Bernie Sanders-style Canada. It’s 0%. Zero. On the basis that the lottery itself is already a tax, since its sole purpose is to augment government revenue. That’s why lotteries like Powerball exist in the first place.[/li][/ul]
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[li]Fourth, in view of that last point, it’s surprising that right-wingers care so much about lotteries being popular and successful. Who would have thought they’d be so much in favor of a voluntary tax! But hey, if it’s an excuse to take a jab at Bernie Sanders, why not, right? :rolleyes:[/li][/ul]
Every time people talk about a high jackpot (be it lottery, casino, whatever), someone will always say ‘yeah, but it’s only like $Xmillion after taxes’.
My usual response is ‘so, ah, you’d rather just not have any of it?’
I mean, if it’s between playing the lotto and not playing, that’s one thing but I’m always surprised when people are annoyed that their hypothetical winnings are only going to be 7 million dollars instead of the full 10 million. Hey buddy, you have $1500 in the bank and you make 38k a year…you don’t get to complain that your free 7 million dollars should have been 10 million.
I didn’t buy one under the current tax structure, so probably not. Were I the sort of person who bought lottery tickets, the variations in the jackpot amounts (they seem to be about $50 million at a minimum) wouldn’t compel me to buy more or less. I mean, I can only drive one car at any given time.
So, that would be a ‘no’ wrt a cite to back up your assertion. Gotcha. Thanks for playing, here are some marvelous parting gifts including this wonderful ceramic dog and the board game edition of SDMB…
No, but indeed in theory, people could think it’s not worth the effort to become more wealthy. If you’re making, say, 50 k/year, making some efforts to make 1 million/ year is most certainly worth it because it will completely change your life. on the other hand, wiith the law of diminishing returns, if you’re already making 10 millions/years, whether it's worth it to or not try to make 1 million more/year is already dubious. It won’t change much for you. If taxes reduces this extra income to a mere $ 100 k/ year, you’re unlikely to try because this small (for you) amount of money will essentially make no difference to you.
However, this criticism is based on the idea that mostly only the wealthy are going to make efforts to create value. If people already making 10 millions decide to just relax and enjoy life because taxes are to high, there will be no lack of people only making 50 k/year very willing to chase the opportunity the wealthy decided not to pursue, because for them this million buck/year is still a life changer.
So, I’m not convinced that high taxes on the wealthiest would necessarily impact much the creation of wealth. There’s an assumption lying here that only a small set of people who already created wealth can be trusted to create more of it. My opinion is rather that cemeteries are filled with people who believed themselves (or were believed to be) irreplaceable. Still, the world goes on, innovations and creation of wealth included. My belief is that if you take the wealthy out of the pictures (because they die or because they decide to take extended vacations because taxes are too high to work for more money), other people who wants to become wealthy too will be eager and able to fill in for them.
Same in France. You don’t pay a cent on lottery winnings, the state having already taken its (big) share of the money before you even claim your prize.
The question isn’t really “would you be happy with 150 million instead of 900 million?”
The question should be “would the jackpot have ever reached 1.5 billion with a 90% tax?”
The answer is clearly “probably not.” Such are the effects of high tax rates on economic growth.
The recent huge jackpot was a result of a succession of drawings with no winners, and the new longer odds.
Sure, you might take a two dollar chance at 150 million, but would you at four million? At 292 million to one odds?
Works like this:
I earn a hundred bucks by working for it. Various governments take about $40 of that. I spend the $60 bucks I have left on lottery tickets. The “juice” on lotteries is in excess of 50% (in comparison, roulette takes about a 5% share for the house.) That leaves me to expect about $25 in winnings. Of that $25, I’m taxed AGAIN at Bernie’s 90% rate. So now I’ve got a whole $2.50. But I’m supposed to be happy that the government has allowed me to keep that.
Liberal math at its finest. Liberals are good at “allowing”, and deciding when I should be happy with what they’ve allowed.
Sorry, but the question we were asked was “Would you have bought a Powerball ticket with Bernie’s tax on it of 90%”, and the post immediately after the OP showed why the question is based on a bad premise.
The hypothetical is more analogous to capital gains tax being 90%, which is just crazy higher than anything currently under consideration. It is more analogous to cap gains because it is money being risked rather than labor being spent. I believe, but do not have data to back it up, that a capital gains rate of 90% would indeed chill investment. However, the current rate is much smaller than that and there are not even crazy plans to increase it to 90%.
