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Progressive tax structures are also arbitrary but I don’t see anyone here complaining about those.

• danhak 7y ago
  1) Plenty of people complain about progressive taxation and advocate for a flat tax. 2) Progressive tax is not arbitrary. As income increases, a higher % of spending is discretionary. Nearly all of the working class’ income goes to basic necessities. That is part of the rationale.
• Retric 7y ago
  US tax code is in effect surprisingly flat and it’s stuck like that because it collects 27.1% GDP and nobody pays extreme rates. https://en.m.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio https://en.m.wikipedia.org/wiki/List_of_countries_by_tax_rev... For an extreme example a homeless drunk spending most of their income on alcohol is paying a 40% tax for the privilege. Benefits are of course a separate issue, but few want to calculate benefits from free roads, Medicare, police, or Social Security as government welfare. At the other end Bill Gates actual lifetime income is vastly higher than his taxable income due to the charitable tax deduction and capitals gains being deferred until sale.
  • averros 7y ago
    You forget that profits (which drive capital value of a company up in the long run) are subject to corporate tax. On top of which capital gains tax is applied. The effective full-cycle tax rate usually exceeds highest personal income tax rates. (Wages are expenses and so are not subject to corporate taxes). The whole "rich pay less tax" thing is utter B.S.