4 ms·

Tax rates for the wealthy have also declined massively.

by mrcartmeneses 4y ago

refurb 4y ago
The percent of all taxes paid for by the top 1% has only held steady or gone up over time.
- majormajor 4y ago
  This is meaningless without more detailed numbers. If it's held steady or gone up by a few percent while, say, the percent of wealth and income received by them has gone up far more, then... whoops. They're better off.
  - refurb 4y ago
    Well the percent of the GDP that is taxed is pretty steady at 20%, which infers that spending/taxes grows at the same rate as income. Thus the rich are paying the same percent or more of their annual income over time.
    - FranzFerdiNaN 4y ago
      This does not follow at all from those numbers (and reality). Tax pressure has moved towards the middle and lower class, to ease the “burden” of the rich and wealthy.
      - refurb 4y ago
        Reality is literally the opposite of what you claim. I highly suggest you look at actually tax data and not comments from strangers on social media. https://files.taxfoundation.org/20220119175339/The-Top-1-Percents-Share-of-Income-Taxes-Has-Increased-Over-Time-Shares-of-Income-Taxes-by-Income-Group-2001-2019-Summary-of-the-Latest-Federal-Income-Tax-Data-2022-Update.png https://files.taxfoundation.org/20220119175339/The-Top-1-Per... Tax burden for the bottom 50% has dropped. Fewer and fewer low income Americans pay any income tax at all.
        anonymous_sorry 4y ago
        Look, if the top 1% of people used to share 10% of a country's earnings, but now share 20% of a country's earnings, their relative contribution to total tax revenue will grow without any change to the tax regime. So you need to consider the change in income distribution alongside any change in relative tax contributions. Otherwise the stats you cite are pretty meaningless
        refurb 4y ago
        That data is available if you bother to look for it. https://files.taxfoundation.org/20220119175430/The-Top-1-Percents-Share-of-AGI-Fluctuates-with-the-Business-Cycle-Share-of-Adjusted-Gross-Income-by-Income-Group-2001-2019-Summary-of-the-Latest-Federal-Income-Tax-Data-2022-Update.png https://files.taxfoundation.org/20220119175430/The-Top-1-Per... Despite the top 1% total share of income decreasing since 2007, they still pay the same percent of all taxes. Thus the tax burden on the top 1% has increased over time.
        anonymous_sorry 4y ago
        Why pick 2007, except for the fact that it clearly looks like an outlier? It looks to me that the general trend for the top 1% of earners has been a slight increase in both income earned and tax paid
        refurb 4y ago
        Looking at 2007 was a peak in both income earned and taxes paid. Comparing it to today, income earned (as a %) decreased, yet taxes paid (as a % of total) is about the same. So we can at least say from 2007 to now, tax burden increased.
        sensenmann 4y ago
        The tax burden for the top 1% _income_ earners can totally increase while the tax burden for the top 1% wealthy decreases (they earn from dividends, not work)
- cuteboy19 4y ago
  The top 1% have negligible incomes. It's all about capital appreciation in that zone
  - refurb 4y ago
    Sure and they pay taxes on capital gains. https://taxfoundation.org/publications/latest-federal-income-tax-data/ https://taxfoundation.org/publications/latest-federal-income... Note that the percent the top 1% pays goes up when the market goes up and goes down when the market goes down. A big part of that is equity comp.
    - jfim 4y ago
      Keep in mind that not everyone pays taxes on capital gains. People with a lot of appreciated stock can simply borrow using the stock as collateral, and not pay a single penny in capital gains. Depending on the entity that owns the stock, the interest on the loan might even be deductible.
      - refurb 4y ago
        I hear a lot about that, but in reality it makes no sense. At some point in time the loan needs to be repaid and equity sold which carries a tax burden. You could "step up" the basis when you die, but I find it hard to believe some billionaire would roll over debt for 30+ years, pay 200-300% in interest, just to avoid 20% long-term capital gains? I read a lot of conjecture about how this happens and many people said Musk did this, yet he paid $500M in taxes last year?!?
        dlp211 4y ago
        Your math is off. The 200-300% interest doesn't matter if the return on your capital is greater than the interest rate.
        refurb 4y ago
        Who can guarantee a return on capital? Tech stocks are down 50-75% now. You think it was smarter to borrow money against that equity rather than sell and pay taxes? Like I said, it's all theoretical, yet no one has actually shown me numbers that makes sense. Delay selling equity? Sure? Delay it until you are dead? No way (unless you're within a few years of dying).

Tax rates for the wealthy have also declined massively.

refurb 4y ago

The percent of all taxes paid for by the top 1% has only held steady or gone up over time.

majormajor 4y ago
This is meaningless without more detailed numbers. If it's held steady or gone up by a few percent while, say, the percent of wealth and income received by them has gone up far more, then... whoops. They're better off.
- refurb 4y ago
  Well the percent of the GDP that is taxed is pretty steady at 20%, which infers that spending/taxes grows at the same rate as income. Thus the rich are paying the same percent or more of their annual income over time.
  - FranzFerdiNaN 4y ago
    This does not follow at all from those numbers (and reality). Tax pressure has moved towards the middle and lower class, to ease the “burden” of the rich and wealthy.
    - refurb 4y ago
      Reality is literally the opposite of what you claim. I highly suggest you look at actually tax data and not comments from strangers on social media. https://files.taxfoundation.org/20220119175339/The-Top-1-Percents-Share-of-Income-Taxes-Has-Increased-Over-Time-Shares-of-Income-Taxes-by-Income-Group-2001-2019-Summary-of-the-Latest-Federal-Income-Tax-Data-2022-Update.png https://files.taxfoundation.org/20220119175339/The-Top-1-Per... Tax burden for the bottom 50% has dropped. Fewer and fewer low income Americans pay any income tax at all.
      - anonymous_sorry 4y ago
        Look, if the top 1% of people used to share 10% of a country's earnings, but now share 20% of a country's earnings, their relative contribution to total tax revenue will grow without any change to the tax regime. So you need to consider the change in income distribution alongside any change in relative tax contributions. Otherwise the stats you cite are pretty meaningless
        refurb 4y ago
        That data is available if you bother to look for it. https://files.taxfoundation.org/20220119175430/The-Top-1-Percents-Share-of-AGI-Fluctuates-with-the-Business-Cycle-Share-of-Adjusted-Gross-Income-by-Income-Group-2001-2019-Summary-of-the-Latest-Federal-Income-Tax-Data-2022-Update.png https://files.taxfoundation.org/20220119175430/The-Top-1-Per... Despite the top 1% total share of income decreasing since 2007, they still pay the same percent of all taxes. Thus the tax burden on the top 1% has increased over time.
        anonymous_sorry 4y ago
        Why pick 2007, except for the fact that it clearly looks like an outlier? It looks to me that the general trend for the top 1% of earners has been a slight increase in both income earned and tax paid
        refurb 4y ago
        Looking at 2007 was a peak in both income earned and taxes paid. Comparing it to today, income earned (as a %) decreased, yet taxes paid (as a % of total) is about the same. So we can at least say from 2007 to now, tax burden increased.
        sensenmann 4y ago
        The tax burden for the top 1% _income_ earners can totally increase while the tax burden for the top 1% wealthy decreases (they earn from dividends, not work)
cuteboy19 4y ago
The top 1% have negligible incomes. It's all about capital appreciation in that zone
- refurb 4y ago
  Sure and they pay taxes on capital gains. https://taxfoundation.org/publications/latest-federal-income-tax-data/ https://taxfoundation.org/publications/latest-federal-income... Note that the percent the top 1% pays goes up when the market goes up and goes down when the market goes down. A big part of that is equity comp.
  - jfim 4y ago
    Keep in mind that not everyone pays taxes on capital gains. People with a lot of appreciated stock can simply borrow using the stock as collateral, and not pay a single penny in capital gains. Depending on the entity that owns the stock, the interest on the loan might even be deductible.
    - refurb 4y ago
      I hear a lot about that, but in reality it makes no sense. At some point in time the loan needs to be repaid and equity sold which carries a tax burden. You could "step up" the basis when you die, but I find it hard to believe some billionaire would roll over debt for 30+ years, pay 200-300% in interest, just to avoid 20% long-term capital gains? I read a lot of conjecture about how this happens and many people said Musk did this, yet he paid $500M in taxes last year?!?
      - dlp211 4y ago
        Your math is off. The 200-300% interest doesn't matter if the return on your capital is greater than the interest rate.
        refurb 4y ago
        Who can guarantee a return on capital? Tech stocks are down 50-75% now. You think it was smarter to borrow money against that equity rather than sell and pay taxes? Like I said, it's all theoretical, yet no one has actually shown me numbers that makes sense. Delay selling equity? Sure? Delay it until you are dead? No way (unless you're within a few years of dying).