3 ms·

"Get away with" paying $56M in taxes annually? That was the average "top 400" taxpayer bill in 2012. https://www.irs.gov/pub/irs-soi/12intop400.pdf https://www

"Get away with" paying $56M in taxes annually? That was the average "top 400" taxpayer bill in 2012. https://www.irs.gov/pub/irs-soi/12intop400.pdf https://www.irs.gov/pub/irs-soi/12intop400.pdf Life in the U.S. is good, but nobody is getting an "unfair" allocation of all the great benefits and opportunities the federal government provides if they're paying $56M for it.

rayiner 11y ago
The average income of the top 400 taxpayers is $335 million/year. Had those people been born and grown up in Bangladesh, instead of the U.S., I doubt it would be 1/10th as much, if that. So $56 million a year doesn't sound so bad for the privilege of living in a society that enables wealth creation like few others.
- twoodfin 11y ago
  Neither would $100M or $200M. And for someone making $50,000, paying a 50% effective rate sounds like a great deal compared to living in Bangladesh. I don't think that argument implies anything about what rates should be, which makes me wonder exactly what it's supposed to demonstrate.
  - rayiner 11y ago
    Presumably, it's "fair" to tax people somehow proportionally to the amount of benefit they derive from living in the U.S. with its government. If someone would make $10 million were they born in Bangladesh, but make $100 million having been born in the U.S, that excess $90 million is a benefit they derive from the U.S. and it's fair to tax them up to $89 million of that. They're still $1 million better off than the baseline. Now, that's the limit of what's morally "fair." What's "optimal," taking into account competing developed countries, may be a lot lower. But taxing up to that limit is "fair."
    - lifeisstillgood 11y ago
      That's a really good argument - and emphasises the value of living in one country over another - very reminiscent of city state style arbitrage. I feel there is another "fair" - that of paying the same percentage of income or wealth as everyone else. This is easier to explain and appeals to a more monkey brain part of us. As an example (from the cbsnews link) While the tax rate on dividends has since jumped to 20 percent for people earning more than $400,000 annually, that's still far below the tax imposed on wages for America's highest earners. 20 percent on dividends !? That can't be right ? In the UK we get the same rate as all other income (40 rising to 45). Can I move ?
      - twoodfin 11y ago
        Does your boss ever say to you: "We're having a really bad year. Instead of paying you $50,000, I'm going to have to pull $50,000 out of your savings account"? That's the difference between taxes on investments and on income. Investors are risking loss in a way that workers are not: If your boss stops paying you, you stop working.
        rayiner 11y ago
        I don't see how the risk is relevant. If you lose $50,000 as an investor, you can carry that forward as a loss to offset future gains.
      - malyk 11y ago
        But society provides an unfair distribution of the benefits of society. A black male born in west Oakland doesn't receive nearly the societal benefit as a white male born to a family a couple miles away in Peidmont. So why should we tax the first guy at the same percentage of the second when the second is receiving extremely more than the first?
    - twoodfin 11y ago
      What's special about Bangladesh when defining "fair"? Do you mean it as a proxy for somewhere with no significant government benefits or services? And since Bangladesh's median per capita income is something like $600, it implies that tax rates capturing all but $600 of the median U.S. worker's $51,000 would be "morally fair". 98.8% effective rates! I don't think a definition so constructed has any significant value.
ryandrake 11y ago
In 2012, the top 400 earners reported average income of $335.7 million [1]. $335 million! The ultra-wealthy get a huge allocation of "benefits and opportunities" from the government, much more than anyone else. $56M seems like a fantastic deal, as it pays for the system that is set up pretty much entirely to ensure these top earners make gobs and gobs of money forever. 1: http://www.cbsnews.com/news/the-400-highest-earning-americans-very-very-good-year/ http://www.cbsnews.com/news/the-400-highest-earning-american...

rayiner 11y ago

The average income of the top 400 taxpayers is $335 million/year. Had those people been born and grown up in Bangladesh, instead of the U.S., I doubt it would be 1/10th as much, if that. So $56 million a year doesn't sound so bad for the privilege of living in a society that enables wealth creation like few others.

twoodfin 11y ago
Neither would $100M or $200M. And for someone making $50,000, paying a 50% effective rate sounds like a great deal compared to living in Bangladesh. I don't think that argument implies anything about what rates should be, which makes me wonder exactly what it's supposed to demonstrate.
- rayiner 11y ago
  Presumably, it's "fair" to tax people somehow proportionally to the amount of benefit they derive from living in the U.S. with its government. If someone would make $10 million were they born in Bangladesh, but make $100 million having been born in the U.S, that excess $90 million is a benefit they derive from the U.S. and it's fair to tax them up to $89 million of that. They're still $1 million better off than the baseline. Now, that's the limit of what's morally "fair." What's "optimal," taking into account competing developed countries, may be a lot lower. But taxing up to that limit is "fair."
  - lifeisstillgood 11y ago
    That's a really good argument - and emphasises the value of living in one country over another - very reminiscent of city state style arbitrage. I feel there is another "fair" - that of paying the same percentage of income or wealth as everyone else. This is easier to explain and appeals to a more monkey brain part of us. As an example (from the cbsnews link) While the tax rate on dividends has since jumped to 20 percent for people earning more than $400,000 annually, that's still far below the tax imposed on wages for America's highest earners. 20 percent on dividends !? That can't be right ? In the UK we get the same rate as all other income (40 rising to 45). Can I move ?
    - twoodfin 11y ago
      Does your boss ever say to you: "We're having a really bad year. Instead of paying you $50,000, I'm going to have to pull $50,000 out of your savings account"? That's the difference between taxes on investments and on income. Investors are risking loss in a way that workers are not: If your boss stops paying you, you stop working.
      - rayiner 11y ago
        I don't see how the risk is relevant. If you lose $50,000 as an investor, you can carry that forward as a loss to offset future gains.
    - malyk 11y ago
      But society provides an unfair distribution of the benefits of society. A black male born in west Oakland doesn't receive nearly the societal benefit as a white male born to a family a couple miles away in Peidmont. So why should we tax the first guy at the same percentage of the second when the second is receiving extremely more than the first?
  - twoodfin 11y ago
    What's special about Bangladesh when defining "fair"? Do you mean it as a proxy for somewhere with no significant government benefits or services? And since Bangladesh's median per capita income is something like $600, it implies that tax rates capturing all but $600 of the median U.S. worker's $51,000 would be "morally fair". 98.8% effective rates! I don't think a definition so constructed has any significant value.

ryandrake 11y ago

In 2012, the top 400 earners reported average income of $335.7 million [1]. $335 million! The ultra-wealthy get a huge allocation of "benefits and opportunities" from the government, much more than anyone else. $56M seems like a fantastic deal, as it pays for the system that is set up pretty much entirely to ensure these top earners make gobs and gobs of money forever. 1: http://www.cbsnews.com/news/the-400-highest-earning-americans-very-very-good-year/ http://www.cbsnews.com/news/the-400-highest-earning-american...