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> Force people to spend it or tax it at 90% when it's passed on. Your whole line of thinking seems absurd to me. Why is it totally fine (by you) for someone to

> Force people to spend it or tax it at 90% when it's passed on. Your whole line of thinking seems absurd to me. Why is it totally fine (by you) for someone to spend all their money on themselves, but not okay for them to gift it to someone? You're saying if it's a gift (or estate passed to children/spouse), tax it a second time at 90%. But if they spend it on fancy hotels, luxury cruises, etc. there's no double tax. This is absurd, and irrational. > The top marginal tax rate in California is over 50%. How is this relevant? Marginal tax rate is a different unrelated thing. I for one, support a marginal tax rate of at least 70% on very high incomes. I think the people making less than $100k should pay a near-zero income tax, and people making above, say $2 million, should be taxed at least 70%. (Or, even better, at 90%.) But I want to keep taxes zero or nearly-zero for the middle-class, especially for the poor. In a tax system like mine, the tax-as-a-percentage-of-GDP would remain fairly low. So your comment on the "top marginal tax rate in California" is absolutely irrelevant. > You can't give it to someone else, for instance, in excess of $14K per year you have to pay a gift tax. I'm well aware of the gift tax, and I support it (at the current rate). It was created to prevent people from circumventing the estate tax (which I also support at the current rate). Now, notwithstanding the fact that this also is irrelevant to the point I raised, I'll point out another error: you and a lot of people think the gift tax exclusion is the only things there is, and forget about the lifetime gift tax exemption. You have a lifetime gift tax exemption of $11.18 million, and an annual gift tax exclusion of $15K, as of 2018. Only after you've given away $11.18 million, does the annual $15K limit kick in. > You can't open a brokerage account in a foreign country and buy assets there This is patently not true. Plenty of countries let you open brokerage accounts without being a citizen or resident there. And US law doesn't prevent you from opening brokerage accounts abroad. (The FATCA has made it a PITA for foreign financial firms to deal with American clients, and they might turn you away; but for those who are not American, that's not an issue.)

arcticbull 8y ago
> Your whole line of thinking seems absurd to me. Why is it totally fine (by you) for someone to spend all their money on themselves, but not okay for them to gift it to someone? Yes. They earned it, they should benefit from it. Wealth is society's way of rewarding you for creating value to society. That reward shouldn't be transferrable (beyond some trivial quantity). If they don't want to spend it on themselves, they should return it to society. Think about it dispassionately; why does your child deserve your money? They didn't do anything other than be born, so you're basically rewarding them with a privileged lifestyle just for existing. You're choosing to privilege people because of the circumstances of their birth, and I'd hoped we as a people have moved beyond that. They should rise to the level of their ability on their own and be rewarded accordingly. If they can't they shouldn't obtain the benefits and lifestyle. Those who deserve it in the next generation should. IMO, of course. > How is this relevant? Marginal tax rate is a different unrelated thing. I for one, support a marginal tax rate of at least 70% on very high incomes. I think the people making less than $100k should pay a near-zero income tax, and people making above, say $2 million, should be taxed at least 70%. (Or, even better, at 90%.) Fine by me :) > Only after you've given away $11.18 million, does the annual $15K limit kick in. Indeed, I'd forgotten that. I think that should be eliminated. > This is patently not true. Plenty of countries let you open brokerage accounts without being a citizen or resident there. And US law doesn't prevent you from opening brokerage accounts abroad. (The FATCA has made it a PITA for foreign financial firms to deal with American clients, and they might turn you away; but for those who are not American, that's not an issue.) Those who aren't "US Persons," which includes anyone resident in the US -- even anyone a tax resident of the US in the current year. Regardless of nationality. This one isn't FATCA related, it's SEC regulation: "Under Regulation S of the Securities Act 1933, the SEC prohibits – among other things – foreign financial institutions that are not registered and regulated in the US abroad from soliciting US residents as clients." [1] FATCA is awful, but it's not responsible for this. [1] https://the-international-investor.com/investment-faq/us-residents-open-foreign-bank-brokerage-accounts https://the-international-investor.com/investment-faq/us-res...
- winter_blue 8y ago
  > anyone resident in the US Yes, I'm well aware of that. I moved to the U.S. in 2007, and I'm not a citizen or a permanent resident yet (and not that close getting permanent residency either). Not because I don't want to become a US citizen, but because US immigration laws make it incredibly difficult to gain permanent residency if you're not family-sponsored and qualify for refuge/asylum. My presence in the US, per the IRS' Substantial Presence Test[1], makes me a "US person" and subjects me to the related taxes. I use the word "American"[2] in the sense defined by Jose Antonio Vargas[3]. He's written a great book[4] on the topic. > the SEC prohibits – among other things – foreign financial institutions that are not registered and regulated in the US abroad from soliciting US residents as clients This is a good thing, and this makes perfect sense. The SEC exists to protect US investors. If an unregulated nefarious company solicited US investors, that would expose them to potentially huge danger. There are enough bad-faith and Ponzi investment schemes cropping up, it's best to not expose Americans to soliciting from investment firms all around the word. But -- as far as I'm aware -- nowhere does federal law or regulations (incl. SEC rules) state that a US person can't open a brokerage account abroad. Sure, a foreign brokerage can't advertise to you nor solicit you, but there's nothing preventing you from doing your research, and finding a brokerage abroad you like, and applying to open an account with them. (Of course, it'll depend on that country's rules and whether they allow non-citizen non-resident person to open brokerage accounts in their country, but in general, one could say a country loses nothing by receiving foreign direct investment, so would likely welcome it.) > They didn't do anything other than be born, so you're basically rewarding them with a privileged lifestyle ... Let's clarify who gets the proceeds from your hypothetical 90% tax. The citizens of the X country? I want to ask a rhetorical question at this point: why should the citizen of the X country be rewarded over another country? Because they were born there or have ancestry to the people who inhabited that land a long time ago? As per your argument, they didn't do anything to deserve it. Other than being born on X piece of soil. I've paid hundreds of thousands of dollars in taxes. The US has such horrid immigration laws that it's almost impossible for anyone to obtain permanent residency in this country outside family/DV/reugee+asylee routes. The fact that I've been here for over a decade legally, and have paid hundreds of thousands of dollars in taxes -- counts for nothing/nada/zilch under US immigration law. My freedom to live here could be stripped away easily if I lost my job. I'm years away from citizenship. So here's my question: wouldn't the right thing to do be to distribute all of the revenue equally to the whole world? Is that fine? > hey earned it, they should benefit from it. What if they don't want to benefit from it, but rather want someone else to benefit from it? Why is that not okay? Spending money on oneself vs spending it on someone else -- where's the distinction? Perhaps they get great joy in giving the money to others. That's their choice. By the way, the only distinction between the two kinds of money transfers is that one's a donation/gift, while the other is a transaction involving the exchange of services/goods. What you want is to effectively ban gifts and donations. It seems like in your ideal world, all people (are forced to) engage in purely transactional relationships, and charity is non-existent/banned. In summary, what I can say is: all of your ideas and arguments are truly shallow, poorly thought-out, logically inconsistent, and incoherent. While leaning heavily towards communistic tendencies, and an utter destruction of personal freedom / individual liberty. [1] https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test https://www.irs.gov/individuals/international-taxpayers/subs... [2] https://defineamerican.com/ https://defineamerican.com/ [3] https://en.wikipedia.org/wiki/Jose_Antonio_Vargas https://en.wikipedia.org/wiki/Jose_Antonio_Vargas [4] https://www.amazon.com/gp/product/B0776TSKBJ/ https://www.amazon.com/gp/product/B0776TSKBJ/

arcticbull 8y ago

> Your whole line of thinking seems absurd to me. Why is it totally fine (by you) for someone to spend all their money on themselves, but not okay for them to gift it to someone? Yes. They earned it, they should benefit from it. Wealth is society's way of rewarding you for creating value to society. That reward shouldn't be transferrable (beyond some trivial quantity). If they don't want to spend it on themselves, they should return it to society. Think about it dispassionately; why does your child deserve your money? They didn't do anything other than be born, so you're basically rewarding them with a privileged lifestyle just for existing. You're choosing to privilege people because of the circumstances of their birth, and I'd hoped we as a people have moved beyond that. They should rise to the level of their ability on their own and be rewarded accordingly. If they can't they shouldn't obtain the benefits and lifestyle. Those who deserve it in the next generation should. IMO, of course. > How is this relevant? Marginal tax rate is a different unrelated thing. I for one, support a marginal tax rate of at least 70% on very high incomes. I think the people making less than $100k should pay a near-zero income tax, and people making above, say $2 million, should be taxed at least 70%. (Or, even better, at 90%.) Fine by me :) > Only after you've given away $11.18 million, does the annual $15K limit kick in. Indeed, I'd forgotten that. I think that should be eliminated. > This is patently not true. Plenty of countries let you open brokerage accounts without being a citizen or resident there. And US law doesn't prevent you from opening brokerage accounts abroad. (The FATCA has made it a PITA for foreign financial firms to deal with American clients, and they might turn you away; but for those who are not American, that's not an issue.) Those who aren't "US Persons," which includes anyone resident in the US -- even anyone a tax resident of the US in the current year. Regardless of nationality. This one isn't FATCA related, it's SEC regulation: "Under Regulation S of the Securities Act 1933, the SEC prohibits – among other things – foreign financial institutions that are not registered and regulated in the US abroad from soliciting US residents as clients." [1] FATCA is awful, but it's not responsible for this. [1] https://the-international-investor.com/investment-faq/us-residents-open-foreign-bank-brokerage-accounts https://the-international-investor.com/investment-faq/us-res...

winter_blue 8y ago
> anyone resident in the US Yes, I'm well aware of that. I moved to the U.S. in 2007, and I'm not a citizen or a permanent resident yet (and not that close getting permanent residency either). Not because I don't want to become a US citizen, but because US immigration laws make it incredibly difficult to gain permanent residency if you're not family-sponsored and qualify for refuge/asylum. My presence in the US, per the IRS' Substantial Presence Test[1], makes me a "US person" and subjects me to the related taxes. I use the word "American"[2] in the sense defined by Jose Antonio Vargas[3]. He's written a great book[4] on the topic. > the SEC prohibits – among other things – foreign financial institutions that are not registered and regulated in the US abroad from soliciting US residents as clients This is a good thing, and this makes perfect sense. The SEC exists to protect US investors. If an unregulated nefarious company solicited US investors, that would expose them to potentially huge danger. There are enough bad-faith and Ponzi investment schemes cropping up, it's best to not expose Americans to soliciting from investment firms all around the word. But -- as far as I'm aware -- nowhere does federal law or regulations (incl. SEC rules) state that a US person can't open a brokerage account abroad. Sure, a foreign brokerage can't advertise to you nor solicit you, but there's nothing preventing you from doing your research, and finding a brokerage abroad you like, and applying to open an account with them. (Of course, it'll depend on that country's rules and whether they allow non-citizen non-resident person to open brokerage accounts in their country, but in general, one could say a country loses nothing by receiving foreign direct investment, so would likely welcome it.) > They didn't do anything other than be born, so you're basically rewarding them with a privileged lifestyle ... Let's clarify who gets the proceeds from your hypothetical 90% tax. The citizens of the X country? I want to ask a rhetorical question at this point: why should the citizen of the X country be rewarded over another country? Because they were born there or have ancestry to the people who inhabited that land a long time ago? As per your argument, they didn't do anything to deserve it. Other than being born on X piece of soil. I've paid hundreds of thousands of dollars in taxes. The US has such horrid immigration laws that it's almost impossible for anyone to obtain permanent residency in this country outside family/DV/reugee+asylee routes. The fact that I've been here for over a decade legally, and have paid hundreds of thousands of dollars in taxes -- counts for nothing/nada/zilch under US immigration law. My freedom to live here could be stripped away easily if I lost my job. I'm years away from citizenship. So here's my question: wouldn't the right thing to do be to distribute all of the revenue equally to the whole world? Is that fine? > hey earned it, they should benefit from it. What if they don't want to benefit from it, but rather want someone else to benefit from it? Why is that not okay? Spending money on oneself vs spending it on someone else -- where's the distinction? Perhaps they get great joy in giving the money to others. That's their choice. By the way, the only distinction between the two kinds of money transfers is that one's a donation/gift, while the other is a transaction involving the exchange of services/goods. What you want is to effectively ban gifts and donations. It seems like in your ideal world, all people (are forced to) engage in purely transactional relationships, and charity is non-existent/banned. In summary, what I can say is: all of your ideas and arguments are truly shallow, poorly thought-out, logically inconsistent, and incoherent. While leaning heavily towards communistic tendencies, and an utter destruction of personal freedom / individual liberty. [1] https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test https://www.irs.gov/individuals/international-taxpayers/subs... [2] https://defineamerican.com/ https://defineamerican.com/ [3] https://en.wikipedia.org/wiki/Jose_Antonio_Vargas https://en.wikipedia.org/wiki/Jose_Antonio_Vargas [4] https://www.amazon.com/gp/product/B0776TSKBJ/ https://www.amazon.com/gp/product/B0776TSKBJ/