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"Raise my taxes by 10-15% (by increasing the tax rate at the upper brackets) and put that money towards taking care of people who aren't employed." That might

by rsync 6y ago

"Raise my taxes by 10-15% (by increasing the tax rate at the upper brackets) and put that money towards taking care of people who aren't employed." That might be viable in states like Florida or Nevada. However, the most populous states have upper bracket state+federal rates that exceed 50% - so that well has already been tapped. California, as you may know, has identical treatment for simple income and capital gains income, so even that avenue for tax expansion has already been opened up.

ceejayoz 6y ago
> However, the most populous states have upper bracket state+federal rates that exceed 50% - so that well has already been tapped. Hardly. The top marginal rate peaked at 94% in 1944. It didn't dip below 70% for the next three decades, either - and we still managed to have a golden era. We're hardly tapped out.
- rsync 6y ago
  I am well aware of the historical tax rates in the United States and welcome any opportunity to point out that those very high marginal rates were put in place specifically to discourage and penalize war profiteering in WW2: "The crisis of World War II led Congress to pass four excess profits statutes between 1940 and 1943. The 1940 rates ranged from 25 to 50 percent and the 1941 ones from 35 to 60 percent. In 1942 a flat rate of 90 percent was adopted, with a postwar refund of 10 percent; in 1943 the rate was increased to 95 percent, with a 10 percent refund."[1] It's important to understand this historical - and exceptional - aspect to those marginal tax rates and not misconstrue them as a fantastically progressive tax policy. Setting aside those exceptional, war-related circumstances, I am skeptical that income taxation above 50% is workable. One may indeed enact such a rate but even in the absence of (criminal) tax evasion, legitimate tax avoidance activities will keep us below that threshold - a threshold that I think many people associate with basic concepts of fairness. [1] https://en.wikipedia.org/wiki/Excess_profits_tax https://en.wikipedia.org/wiki/Excess_profits_tax

by rsync 6y ago

ceejayoz 6y ago

> However, the most populous states have upper bracket state+federal rates that exceed 50% - so that well has already been tapped. Hardly. The top marginal rate peaked at 94% in 1944. It didn't dip below 70% for the next three decades, either - and we still managed to have a golden era. We're hardly tapped out.

rsync 6y ago
I am well aware of the historical tax rates in the United States and welcome any opportunity to point out that those very high marginal rates were put in place specifically to discourage and penalize war profiteering in WW2: "The crisis of World War II led Congress to pass four excess profits statutes between 1940 and 1943. The 1940 rates ranged from 25 to 50 percent and the 1941 ones from 35 to 60 percent. In 1942 a flat rate of 90 percent was adopted, with a postwar refund of 10 percent; in 1943 the rate was increased to 95 percent, with a 10 percent refund."[1] It's important to understand this historical - and exceptional - aspect to those marginal tax rates and not misconstrue them as a fantastically progressive tax policy. Setting aside those exceptional, war-related circumstances, I am skeptical that income taxation above 50% is workable. One may indeed enact such a rate but even in the absence of (criminal) tax evasion, legitimate tax avoidance activities will keep us below that threshold - a threshold that I think many people associate with basic concepts of fairness. [1] https://en.wikipedia.org/wiki/Excess_profits_tax https://en.wikipedia.org/wiki/Excess_profits_tax