5 ms·

Wouldn't you if you had tons of money?, especially if all the other "rich kids" are doing the same?. If you expect people to always do the altruistic thing the

Wouldn't you if you had tons of money?, especially if all the other "rich kids" are doing the same?. If you expect people to always do the altruistic thing then be prepared for a life full of disappointment. The best you can do is try to shape peoples behavior. Personally I would prefer a flat percentage rate of tax with an exception for very low incomes where it just isn't worth the governments time trying to collect it. This would probably raise most peoples tax and lower rich peoples tax but I believe it is "fairer" for everybody to pay the same fixed proportion of their income. At the same time though I would simplify business taxes as well, get rid of loopholes, stop companies that do business in a country off shoring their profits. It is insane that some companies view their accounting departments as profit centers. Flat tax economies boom, and they are progressive in the sense that there is no penalty for trying to earn more money.

seabee 15y ago
> a flat percentage rate of tax with an exception for very low incomes That's not a flat tax, then, is it? It's progressive with two bands, 0% and x%. There is a real case for tax simplification, but the progressive nature of income tax is probably the simplest thing in the entire tax code! It's the classification of different kinds of income and capital gains, exemptions and penalties for particular uses of money/assets that makes it challenging and is the reason there is real money in tax avoidance. Don't throw out the baby with the bath water. Finally, a progressive tax means higher earners pay a larger proportion of their income than lower earners. It's hard to gauge the validity of your argument when your assertions run contrary to the definitions of the words you use.
- epscylonb 15y ago
  The reason I put fairer in quotes is because it is a term that can be argued over. Yes two bands, with the focus on making it attractive for people to earn money and pay tax, ideally the 0% band would be just enough to clothe, feed yourself and pay rent in a bad neighbourhood. Progressive is a word that seems to mean different things to the left and the right, I notice you didn't define it. As I said a flat tax is economically progressive because it doesn't discourage people from trying to earn more money. At the moment you have people buying houses they don't need or using complex financial instruments just to do something with their money because if they don't they will get taxed more. Investing this money for the sake of it is not always beneficial to the economy or society, I favour a persons right to choose what to do with their own money. I am coming from this from a libertarian perspective, whether you earn 50k a year or 500k the government should not be taking a higher percentage from you than other people. Especially considering that with a percentage rate whilst the proportion is the same, the actual amount of tax high earners pay is greater (which is socially progressive enough for me, but perhaps not for you). I believe I am using the word proportion correctly here, but if not please feel free to let me know how I have got it wrong. Here in the UK the top rate of tax is 50%. I doubt I will ever be taxed at that rate but the government taking half a persons income scares me a little, no wonder people try to move their money around so the taxman can't get at it.
  - ZachPruckowski 15y ago
    >Progressive is a word that seems to mean different things to the left and the right, I notice you didn't define it. "Progressive" has a very specific meaning when you're discussing tax structure, independent of its political meaning. Specifically, a progressive tax is one in which the effective rate you pay rises with income.
    - gaius 15y ago
      It's a word that has been at best deliberately overloaded, and at worst hijacked. Who would want to stand in the way of "progress"? It could equally well mean, the more you earn they more you get to keep.
      - krschultz 15y ago
        No, it is a description of the tax code. It is not a judgement of the tax code. It is a 'progressive tax' or 'progressive tax rate'. It has nothing to do with 'progress' or the 'Progressive party'. http://en.wikipedia.org/wiki/Progressive_tax http://en.wikipedia.org/wiki/Progressive_tax
        onemoreact 15y ago
        Yes, but people call our taxcode Progressive, when as Buffet point's out it's regressive at the top.
  - seabee 15y ago
    'Progressive' as used in the same context as your original post is basically a placeholder for 'benefiting the groups I care about'. It's not a meaningful word to use, and you even know that. Contrast with 'progressive tax', which is well-defined. I don't understand the line of thinking which effectively says "people don't want to earn £2 if they have to pay £1 in tax". Erm, you're still richer than you were if you didn't earn more. The only possible argument against this is if earning another £100k takes more amount of effort it took to earn your first £100k. But if you know anything about making money it doesn't work that way. With more capital comes greater opportunities. You can afford an accountant to manage your money, you have more investment options, and so forth; and you still have enough to spare for a comfortable lifestyle. A flat tax implies that a dollar is worth just as much to Warren Buffett as it is to someone flipping burgers, which demonstrates a complete lack of perspective. Put it this way: everyone's living expenses are, say, £12k. now if you're earning a median wage that leaves you £10k to invest how you like. If you're earning £50k you get to invest £38k. assuming the schemes offer the same rate of return, guess who is going to amass £50k first? Hint: it's not the guy who has to get a 5x return on his investment. The higher rate income tax is an incentive to invest the money you receive back into the economy via business or charity, where it is taxed at a lower rate or even not at all, rather than spent on your own personal gain. Why should it scare you that the government would take that money? BTW, investment in financial instruments of dubious benefit is giving money to the financial system (this should really be obvious...) so it does contribute to the economy, but there are almost certainly better ways to do so. The problem with the libertarian perspective is that it irrationally assumes the best of people when there is no incentive for them to do so. If a billionnaire can afford to fund all the services he requires that someone on the poverty line would depend on government for, why should the billionnaire give his money away? If you want a society you have an obligation to provide for one, if you believe it is unfair that someone with broader shoulders should carry more weight, then perhaps you should consider how fair it is that he has broader shoulders and others do not.

seabee 15y ago

> a flat percentage rate of tax with an exception for very low incomes That's not a flat tax, then, is it? It's progressive with two bands, 0% and x%. There is a real case for tax simplification, but the progressive nature of income tax is probably the simplest thing in the entire tax code! It's the classification of different kinds of income and capital gains, exemptions and penalties for particular uses of money/assets that makes it challenging and is the reason there is real money in tax avoidance. Don't throw out the baby with the bath water. Finally, a progressive tax means higher earners pay a larger proportion of their income than lower earners. It's hard to gauge the validity of your argument when your assertions run contrary to the definitions of the words you use.

epscylonb 15y ago
The reason I put fairer in quotes is because it is a term that can be argued over. Yes two bands, with the focus on making it attractive for people to earn money and pay tax, ideally the 0% band would be just enough to clothe, feed yourself and pay rent in a bad neighbourhood. Progressive is a word that seems to mean different things to the left and the right, I notice you didn't define it. As I said a flat tax is economically progressive because it doesn't discourage people from trying to earn more money. At the moment you have people buying houses they don't need or using complex financial instruments just to do something with their money because if they don't they will get taxed more. Investing this money for the sake of it is not always beneficial to the economy or society, I favour a persons right to choose what to do with their own money. I am coming from this from a libertarian perspective, whether you earn 50k a year or 500k the government should not be taking a higher percentage from you than other people. Especially considering that with a percentage rate whilst the proportion is the same, the actual amount of tax high earners pay is greater (which is socially progressive enough for me, but perhaps not for you). I believe I am using the word proportion correctly here, but if not please feel free to let me know how I have got it wrong. Here in the UK the top rate of tax is 50%. I doubt I will ever be taxed at that rate but the government taking half a persons income scares me a little, no wonder people try to move their money around so the taxman can't get at it.
- ZachPruckowski 15y ago
  >Progressive is a word that seems to mean different things to the left and the right, I notice you didn't define it. "Progressive" has a very specific meaning when you're discussing tax structure, independent of its political meaning. Specifically, a progressive tax is one in which the effective rate you pay rises with income.
  - gaius 15y ago
    It's a word that has been at best deliberately overloaded, and at worst hijacked. Who would want to stand in the way of "progress"? It could equally well mean, the more you earn they more you get to keep.
    - krschultz 15y ago
      No, it is a description of the tax code. It is not a judgement of the tax code. It is a 'progressive tax' or 'progressive tax rate'. It has nothing to do with 'progress' or the 'Progressive party'. http://en.wikipedia.org/wiki/Progressive_tax http://en.wikipedia.org/wiki/Progressive_tax
      - onemoreact 15y ago
        Yes, but people call our taxcode Progressive, when as Buffet point's out it's regressive at the top.
- seabee 15y ago
  'Progressive' as used in the same context as your original post is basically a placeholder for 'benefiting the groups I care about'. It's not a meaningful word to use, and you even know that. Contrast with 'progressive tax', which is well-defined. I don't understand the line of thinking which effectively says "people don't want to earn £2 if they have to pay £1 in tax". Erm, you're still richer than you were if you didn't earn more. The only possible argument against this is if earning another £100k takes more amount of effort it took to earn your first £100k. But if you know anything about making money it doesn't work that way. With more capital comes greater opportunities. You can afford an accountant to manage your money, you have more investment options, and so forth; and you still have enough to spare for a comfortable lifestyle. A flat tax implies that a dollar is worth just as much to Warren Buffett as it is to someone flipping burgers, which demonstrates a complete lack of perspective. Put it this way: everyone's living expenses are, say, £12k. now if you're earning a median wage that leaves you £10k to invest how you like. If you're earning £50k you get to invest £38k. assuming the schemes offer the same rate of return, guess who is going to amass £50k first? Hint: it's not the guy who has to get a 5x return on his investment. The higher rate income tax is an incentive to invest the money you receive back into the economy via business or charity, where it is taxed at a lower rate or even not at all, rather than spent on your own personal gain. Why should it scare you that the government would take that money? BTW, investment in financial instruments of dubious benefit is giving money to the financial system (this should really be obvious...) so it does contribute to the economy, but there are almost certainly better ways to do so. The problem with the libertarian perspective is that it irrationally assumes the best of people when there is no incentive for them to do so. If a billionnaire can afford to fund all the services he requires that someone on the poverty line would depend on government for, why should the billionnaire give his money away? If you want a society you have an obligation to provide for one, if you believe it is unfair that someone with broader shoulders should carry more weight, then perhaps you should consider how fair it is that he has broader shoulders and others do not.