6 ms·

What country are you in? In the US, that's basically the opposite of reality.

eimrine 4y ago
I hate to give a video [1] as a proof of something, but at least this one is short and well-made. [1] https://www.youtube.com/watch?v=kXCGbAv8YPw https://www.youtube.com/watch?v=kXCGbAv8YPw
- ALittleLight 4y ago
  That is an interesting video but I think it is engaging in a lot of sleight of hand. Let me go over some examples of what I mean - 1. If you take the video at its word, then it is still the case that the richest are paying more taxes. In the final graph the richest decile is paying over 30% while the poorest is in the mid 20's. The curve is slightly crescent shaped, with the poor 20-30% paying less than the poorest, but beyond that the trend holds that richer pay more. The video summarizes this slope as "mostly flat". 2. The video adds 15% for payroll taxes to the poorer deciles even though the video says that 7.5% is paid by the employee and 7.5% is paid by the company. The video explains that "economists have found that in practice companies pay their part of the payroll tax by just paying workers less." The video doesn't offer any source for this claim. If you Google the claim you see it is, not surprisingly, disputed by economists. It's not a plausible claim in the first place, and if you are allowed to support a claim because some economist somewhere might have said something kind of like it then you could really claim anything. Once you adjust the 15% the video incorrectly added to every lower decile back to 7.5% then the trend of the rich paying more, which was always present, becomes even more prominent. 3. The chart shows the richest 400 Americans as a column on par with the other deciles. This is visually deceptive because it causes you to think of this category as being a similar kind of thing - but it is not, it's a much smaller and extreme group. These people made massive amounts of money from stock in huge companies, gains which are often unrealized, and so taking this small group and graphing it next to deciles distorts what is being shown. How would the graph look if we added on the 400 poorest Americans? And why would we do that except as some rhetorical trick? 4. The video is uninterested in net taxation. That is, poor Americans get significant transfers of money back from the government. For some groups this is substantially more than they pay in taxes which would make their net interaction with government profitable. I can't really agree that a group "pays" X% in taxes if they receive from government transfers more than they paid. 5. The video description says that "All of their data, which we used to produce this video, is available on their website." But it's not. At least, I hope it's not all the data they used to produce this video. There are a few unexplained Excel sheets with some unsourced and unexplained data on the "Tax for Justice" website, but nothing like what I would expect to underlie the claims made in these figures. For example, I wanted to look at how they calculated the sales tax rates, since those varied by state and I thought that the poorest people might be spending more in categories that have no sales taxes (e.g. food) - but... maybe I didn't look hard enough, but I couldn't find anything like this. Just some random tables with numbers. 6. The top decile earns about half the income for the country. They also pay the highest tax rate. So, it's pretty obvious that, in objective terms, most of the taxes are paid by the rich. Even if, pre-benefits, the poor paid tax rates that were only ~10% lower than the richest decile, the richest decile would still be paying substantially more objective dollars in taxes. 7. It's also a bit weird to me that Vox, nominally a news organization, would just uncritically repeat the work of left wing activists out of Berkeley. Is regurgitating advocacy what a news organization is supposed to do?
  - myroon5 4y ago
    2. This is the term if you want to find more results: https://en.wikipedia.org/wiki/Tax_incidence https://en.wikipedia.org/wiki/Tax_incidence Employers pay taxes + net wages and employees only receive net wages no matter who the government says is paying a tax; it should mostly be shared based on price elasticity Although most people don't understand that well, which likely affects behavior irrationally: https://blogs.lse.ac.uk/businessreview/2017/11/15/economists-used-to-think-that-it-doesnt-matter-whom-you-tax-but-it-does/ https://blogs.lse.ac.uk/businessreview/2017/11/15/economists... Another consideration is that wages are sticky, so while tax burden might be shared more based on price elasticity for new offers, new taxes probably would actually fall upon the side the government says (since employers are unlikely to adjust pay up/down for existing employees just because one side has to pay more taxes)
galfarragem 4y ago
I believe OP wanted to say that work gains are taxed way higher than capital gains but didn’t know how to phrase it. Average sallaries are obscenously taxed. In my country having a cheap rental/airbnb grants you a better income than an average full time job..
- 8note 4y ago
  Capitals gains aren't income earners though?
  - imtringued 4y ago
    He distinguished between workers and "incomers".
MisterBastahrd 4y ago
No, it's correct in the US too. Unless you are in the absolute lowest tax bracket, you're paying a larger percentage of your income via various taxes than billionaires are.
- ALittleLight 4y ago
  No, it's not, and no, you aren't. Tax brackets only increase in rate. Tax rates don't start coming back down for the super rich. If your income was in capital gains you would pay the capital gains rates. If the billionaire's income came in through salary they would pay income tax.
  - truckerbill 4y ago
    But they mostly don’t get paid in salary do they so it’s a strawman. The amount of tax paid is proportional to the general utility of the money (wrt day to day living), rather than the inverse. It’s dumb
  - sleepychu 4y ago
    But I can't choose whether my income is in cap or income and the people with the most in capitalism pay the lowest effective tax rate. Who cares how you came by the money? It is fungible.
  - MisterBastahrd 4y ago
    Perhaps you might want to learn how people actually get taxed before complaining about brackets. There are plenty of taxes out there that have jack squat to do with income brackets, and poor people pay a higher percentage of their income towards those than many other people while also having a much higher opportunity cost per hour worked.
  - 8note 4y ago
    The richest take out loans though. Those aren't counted as income or capital gains
tfehring 4y ago
In the US, low- and lower-middle-class income households often do face very high effective marginal tax rates - sometimes north of 60% - due to the combination of direct taxes and benefit cliffs and phase-outs. State income taxes and benefit programs can exacerbate this. Slightly dated reference (2012) but [0] is still pretty representative. [0] https://www.cbo.gov/sites/default/files/cbofiles/attachments/43722-Supplemental_Material-MarginalTaxRates.pdf https://www.cbo.gov/sites/default/files/cbofiles/attachments...
- badpun 4y ago
  Loss of benefit is not a tax.
  - tfehring 4y ago
    It functions like a tax in that it decreases the net amount that you receive for working (more). If you lose 40 cents' worth of benefits for every additional dollar that you earn, it doesn't matter that your "real" marginal tax rate is only 25% - earning an additional pre-tax dollar only makes you 35 cents richer, just as it would if your marginal tax rate were 65%. Also, while some of those benefits are less fungible, others have phase-outs that are functionally identical to taxes at the margin. For example, if you get subsidized health insurance through healthcare.gov, every additional dollar that you earn directly reduces your tax refund by up to ten cents, on top of your marginal tax rate.
asdff 4y ago
How are they wrong? If you got paid $100 this week and are taxed 20% you are left with only $80 to live with and make do with. If you got paid $100,000 this week and are taxed 80% life is great because you have $20k in your pocket this week you didn't have before. Sure the rich pay a higher proportion to taxes perhaps if they aren't skirting the rules, but they make so damn much already that they could stand to be taxed even more and not see much of a shift in their lifestyles, whereas people on the bottom end of the ladder are pretty tapped out.
- hstan4 4y ago
  This example of course only seems reasonable if you focus on the level of extremes you chose
- rhino369 4y ago
  Because people making even 500 dollars a week essentially are only taxed for social security. Complaining about the poor being taxed too much just doesn't make sense in America. You can complain they are exploited by employers and the government doesn't protect them, etc. But high taxation? That's just not the problem.
  - deleted 4y ago
    [deleted]

I hate to give a video [1] as a proof of something, but at least this one is short and well-made. [1] https://www.youtube.com/watch?v=kXCGbAv8YPw https://www.youtube.com/watch?v=kXCGbAv8YPw

ALittleLight 4y ago
That is an interesting video but I think it is engaging in a lot of sleight of hand. Let me go over some examples of what I mean - 1. If you take the video at its word, then it is still the case that the richest are paying more taxes. In the final graph the richest decile is paying over 30% while the poorest is in the mid 20's. The curve is slightly crescent shaped, with the poor 20-30% paying less than the poorest, but beyond that the trend holds that richer pay more. The video summarizes this slope as "mostly flat". 2. The video adds 15% for payroll taxes to the poorer deciles even though the video says that 7.5% is paid by the employee and 7.5% is paid by the company. The video explains that "economists have found that in practice companies pay their part of the payroll tax by just paying workers less." The video doesn't offer any source for this claim. If you Google the claim you see it is, not surprisingly, disputed by economists. It's not a plausible claim in the first place, and if you are allowed to support a claim because some economist somewhere might have said something kind of like it then you could really claim anything. Once you adjust the 15% the video incorrectly added to every lower decile back to 7.5% then the trend of the rich paying more, which was always present, becomes even more prominent. 3. The chart shows the richest 400 Americans as a column on par with the other deciles. This is visually deceptive because it causes you to think of this category as being a similar kind of thing - but it is not, it's a much smaller and extreme group. These people made massive amounts of money from stock in huge companies, gains which are often unrealized, and so taking this small group and graphing it next to deciles distorts what is being shown. How would the graph look if we added on the 400 poorest Americans? And why would we do that except as some rhetorical trick? 4. The video is uninterested in net taxation. That is, poor Americans get significant transfers of money back from the government. For some groups this is substantially more than they pay in taxes which would make their net interaction with government profitable. I can't really agree that a group "pays" X% in taxes if they receive from government transfers more than they paid. 5. The video description says that "All of their data, which we used to produce this video, is available on their website." But it's not. At least, I hope it's not all the data they used to produce this video. There are a few unexplained Excel sheets with some unsourced and unexplained data on the "Tax for Justice" website, but nothing like what I would expect to underlie the claims made in these figures. For example, I wanted to look at how they calculated the sales tax rates, since those varied by state and I thought that the poorest people might be spending more in categories that have no sales taxes (e.g. food) - but... maybe I didn't look hard enough, but I couldn't find anything like this. Just some random tables with numbers. 6. The top decile earns about half the income for the country. They also pay the highest tax rate. So, it's pretty obvious that, in objective terms, most of the taxes are paid by the rich. Even if, pre-benefits, the poor paid tax rates that were only ~10% lower than the richest decile, the richest decile would still be paying substantially more objective dollars in taxes. 7. It's also a bit weird to me that Vox, nominally a news organization, would just uncritically repeat the work of left wing activists out of Berkeley. Is regurgitating advocacy what a news organization is supposed to do?
- myroon5 4y ago
  2. This is the term if you want to find more results: https://en.wikipedia.org/wiki/Tax_incidence https://en.wikipedia.org/wiki/Tax_incidence Employers pay taxes + net wages and employees only receive net wages no matter who the government says is paying a tax; it should mostly be shared based on price elasticity Although most people don't understand that well, which likely affects behavior irrationally: https://blogs.lse.ac.uk/businessreview/2017/11/15/economists-used-to-think-that-it-doesnt-matter-whom-you-tax-but-it-does/ https://blogs.lse.ac.uk/businessreview/2017/11/15/economists... Another consideration is that wages are sticky, so while tax burden might be shared more based on price elasticity for new offers, new taxes probably would actually fall upon the side the government says (since employers are unlikely to adjust pay up/down for existing employees just because one side has to pay more taxes)

galfarragem 4y ago

I believe OP wanted to say that work gains are taxed way higher than capital gains but didn’t know how to phrase it. Average sallaries are obscenously taxed. In my country having a cheap rental/airbnb grants you a better income than an average full time job..

8note 4y ago
Capitals gains aren't income earners though?
- imtringued 4y ago
  He distinguished between workers and "incomers".

MisterBastahrd 4y ago

No, it's correct in the US too. Unless you are in the absolute lowest tax bracket, you're paying a larger percentage of your income via various taxes than billionaires are.

ALittleLight 4y ago
No, it's not, and no, you aren't. Tax brackets only increase in rate. Tax rates don't start coming back down for the super rich. If your income was in capital gains you would pay the capital gains rates. If the billionaire's income came in through salary they would pay income tax.
- truckerbill 4y ago
  But they mostly don’t get paid in salary do they so it’s a strawman. The amount of tax paid is proportional to the general utility of the money (wrt day to day living), rather than the inverse. It’s dumb
- sleepychu 4y ago
  But I can't choose whether my income is in cap or income and the people with the most in capitalism pay the lowest effective tax rate. Who cares how you came by the money? It is fungible.
- MisterBastahrd 4y ago
  Perhaps you might want to learn how people actually get taxed before complaining about brackets. There are plenty of taxes out there that have jack squat to do with income brackets, and poor people pay a higher percentage of their income towards those than many other people while also having a much higher opportunity cost per hour worked.
- 8note 4y ago
  The richest take out loans though. Those aren't counted as income or capital gains

tfehring 4y ago

In the US, low- and lower-middle-class income households often do face very high effective marginal tax rates - sometimes north of 60% - due to the combination of direct taxes and benefit cliffs and phase-outs. State income taxes and benefit programs can exacerbate this. Slightly dated reference (2012) but [0] is still pretty representative. [0] https://www.cbo.gov/sites/default/files/cbofiles/attachments/43722-Supplemental_Material-MarginalTaxRates.pdf https://www.cbo.gov/sites/default/files/cbofiles/attachments...

badpun 4y ago
Loss of benefit is not a tax.
- tfehring 4y ago
  It functions like a tax in that it decreases the net amount that you receive for working (more). If you lose 40 cents' worth of benefits for every additional dollar that you earn, it doesn't matter that your "real" marginal tax rate is only 25% - earning an additional pre-tax dollar only makes you 35 cents richer, just as it would if your marginal tax rate were 65%. Also, while some of those benefits are less fungible, others have phase-outs that are functionally identical to taxes at the margin. For example, if you get subsidized health insurance through healthcare.gov, every additional dollar that you earn directly reduces your tax refund by up to ten cents, on top of your marginal tax rate.

asdff 4y ago

How are they wrong? If you got paid $100 this week and are taxed 20% you are left with only $80 to live with and make do with. If you got paid $100,000 this week and are taxed 80% life is great because you have $20k in your pocket this week you didn't have before. Sure the rich pay a higher proportion to taxes perhaps if they aren't skirting the rules, but they make so damn much already that they could stand to be taxed even more and not see much of a shift in their lifestyles, whereas people on the bottom end of the ladder are pretty tapped out.

hstan4 4y ago
This example of course only seems reasonable if you focus on the level of extremes you chose
rhino369 4y ago
Because people making even 500 dollars a week essentially are only taxed for social security. Complaining about the poor being taxed too much just doesn't make sense in America. You can complain they are exploited by employers and the government doesn't protect them, etc. But high taxation? That's just not the problem.
- deleted 4y ago
  [deleted]