DEAR RICH FOLKS: Get Ready For A (Tax) Revolution... (page 2)

talesin

It was years ago, FHN, but poetry is not a big draw on this board,,, or people read, I think, but don't comment much ....

t

Yes it will be revolutionized. The rich folks that already pay practically no taxes will pay even less taxes and those that do will pay more. They will introduce a 'poor tax' where you will be taxed for being poor and a '"I'm rich biatch" deduction' where you will be fully deducting any taxes paid on income over 200,000.

BusinessInsider is not really a good source for anything. It's a magazine publishing paid-for shill articles as 'content'. It's like an ad-paper you get in your mailbox but trying to appear as a legitimate magazine. It's the Watchtower of the money industry.

darthfader

Thanks all for the posts!

I've been trying to rationalize the tax vs jobs issue. It seems to me that the biggest reason we are losing jobs is due to globalism that the reduction of labor costs in other countries. Second, there is reduced regulation in some countries that lowers the cost of infrastructure and environmantal protections. So an Amercian auto manufacturer has to pay 3x to 6x the labor rates and a higher factory "burden" from regulations and EPA costs. I agree that "lowering" our standards to meet these country's levels is a step in the wrong direction.

Im sure that taxes to effect jobs, it's just not as much as Rebublicans would like you to beleive. Playing the "party of no" is easy, coming up with new and creative ways to establish parity with the effects of globalization is much more difficult.

The fact the GE pays nearly no taxes compared to their revenue is a sign that the tax system is broken and is in need of major "loophole closing".

Cheers!

Anony Mous

Taxes do not affect jobs. That is because the employer does not pay income taxes, the employee (the one with the income) does (the taxes get withheld out of your paycheck). The employer may have to pay taxes when buying things like base products, property etc. but that is very easily deducted by anyone with a decent accountant (when I had a business I paid no taxes for anything).

The thing is that the tax scales go way down once you pass the magic $200,000 point. All of a sudden your income becomes comparatively higher while it should be the other way around. The (false) reasoning behind that is rich people (as individuals) will leave the US. Even though some people may do that, more than often these people have families, jobs and houses here. The US is also pretty safe to have money as your money is insured and we have a pretty good defense against criminals, going to Mexico, Brazil or any 3rd world country with it will settle you for life but you won't ever be safe and Canada, Europe and other 1st world countries have more taxes. The real reason is that senators and other lawmakers have a base salary of roughly $250,000.

The same goes for business, business won't leave because they have to pay taxes. Apple will still want a store in your mall, AT&T will still have to provide for phone service, GE would still like to sell a $99 airco or a windmill and doing that abroad would make it uncompetitive because of the shipping costs alone. Hiring local experts from a relatively highly educated pool will be much better than hiring somebody that doesn't speak the language of the customer and more likely than not will not have had a good basic education. Besides that once those companies start settling in those countries, within a decade the expected wages in that area go up to the same level as the pool of available employees and educated people depletes. Outsourcing was a bit of a fad in the tech-boom but now a lot of companies (like Dell and HP) are quickly scurrying back with their call centers to rural America (now you get to talk to a incomprehensible hick instead of an incomprehensible Indian) while Apple has consistently scored the highest in the industry for customer service. A lot of companies that outsourced were also duped by the locals that would just churn out cheap engineers to fill the demand without really having educated them (or only educated them enough to pass the interviews), managing a group of people that don't understand you or vice versa and have a different culture is very difficult if not impossible.

darthfader

Anony,
Corporations do pay taxes! They file returns just like humans.. If they had income, they will pay taxes on it. Yes you are correct that sales tax can be deducted from their income taxes as an expense. The retail and service sectors can’t leave because they are bound by location, that makes sense. But manufacturing, call centers, IT development can leave pretty easily. For manufacturing, the only barrier may be shipping costs to get it across the ponds..

Yes you are correct that the wages in these other counties will increase - we've already seen that in India for IT services. It's still economical to outsource software development and call centers to these places -- maybe in a few years when the US currency devaluates a bit more that those countries standard of living increase, we'll again have parity. But, at what cost... No middle class??

Dell and HP are only locating a small fraction of their call centers to the states. These were largely because the local cities and counties practically gave away the real-estate and promised 0 tax on their operations for the foreseeable future. I don’t think that's a sustainable practice.

cheers

james_woods

All evils of the economy are due to corporate and private jets.

These tools of Satan should be taxed into oblivion.

tenyearsafter

What is the definition of a "rich person"? Is it annual earnings of $100K?...$200K...$500K? I think everyone's answer to that would differ and be dependent on what our particular economic situation is. I would guess to a person making $40K per year, even $100K would constitute being "rich". If you asked most people earning $200K, they would tell you that they are not "rich", and have similar challenges living within their means. This is the primary challenge I see with a "Robin Hood" approach to taxation.

We have touched on it several times before, but a flat tax is the fairest way to raise revenues and do away with loopholes. This way, there is not tax shelters for the rich or ways for corporations to defer taxes. Unfortunately, this is unlikey to happen in the U.S. as long as lawyers and accountants run Congress and other branches of the government...think about it...all three branches of the U.S. are dominated by lawyers, who have an inherent interest in keeping things complicated through legal complexity, requiring their profession's services to interpret and lead the "uneducated" public through the various legal mazes.

james_woods

We have touched on it several times before, but a flat tax is the fairest way to raise revenues and do away with loopholes.

There is another problem with the flat tax - and that is ideological. People with the Obama mindset want redistribution of income for philosophical reasons. They prefer that the bottom 50 to 60% of income levels pay nothing, while the top 30% pay practically all the burden of income tax. Even that is not (for them) a high enough tax rate on upper income taxpayers. Obama has openly said that he believes government should decide what percent of rich peoples wealth they can keep, and they should be taxed accordingly - that is, they should be taxed specifically to reduce their wealth, because somehow it is unfair to others that they have become wealthy.

A flat tax would cause even low hourly wage people to pay a small amount - and this is an anathema to the redistributors. They think it is morally wrong for low income people to pay anything at all.

I am somewhat surprised that the social security tax (FICA) has remained in place for low income workers all these years - but then, FICA is a social program and maybe it is immune on that basis.

darthfader

James,

Is there no point where the individual’s accumulation of wealth becomes a detriment to the society as a whole? I'm not asking to define an amount of money here, just the concept of asset/income accumulation.

cheers

james_woods

James,

Is there no point where the individual’s accumulation of wealth becomes a detriment to the society as a whole? I'm not asking to define an amount of money here, just the concept of asset/income accumulation.

cheers

I cannot think of any example of any American whose wealth per se has acted as a detriment to society...not Bill Gates, not Warren Buffet, not even George Soros (although I think Soros is using parts of his wealth for stupid and anti-American political aims).

DEAR RICH FOLKS: Get Ready For A (Tax) Revolution...

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