5 ms·

> they hate paying taxes. So they want to shift some of the taxation burden on to the middle class and the poor. I don't understand how making middle/poor clas

> they hate paying taxes. So they want to shift some of the taxation burden on to the middle class and the poor. I don't understand how making middle/poor class pay more taxes spares the rich from taxes.

octagonal 4y ago
It acts as a "pre-emptive" tax shift. If more people pay taxes there's going to be less pressure on the government to set an ever higher tax rate, because now they receive more money while levying the same amount.
- PietdeVries 4y ago
  If more taxes is the reason for this rule, then why try to justify it with references to terrorism?
- cracrecry 4y ago
  As someone who has lived in socialist countries for a long time... the Government always wants more money until they have it all. It is as simple as that. "Less pressure" on the Government is a joke. The more it has, the more it wants. If you give your power away, they take it, and want more. Power 101. The money will be spent on things like public Media and public education to make propaganda for the Government. And on making the people in power mega rich, just like in China, Russia, Cuba, Venezuela or Argentina.
- yucky 4y ago
  Governments only get bigger, never smaller.
josephcsible 4y ago
The government needs a certain amount of revenue. If some people get away with cheating on their taxes, then the tax rates for everyone else need to be higher to get that much revenue.
- wsc981 4y ago
  Income tax should be abolished though. Wealthy people can avoid it easily (get 1 USD wage as CEO and remainder in stock, for example). Only consumption and wealth should be taxed. Wealthy people tend to consume more anyways. For some goods & services (energy consumption for example) a progressive tax rate might be appropriate, with tax exception for people who consume the least (as poor tend to do). Luxury goods and services (private planes and yachts, luxury car brands, etcetera should also have a higher than normal tax rate, since for wealthy people the barrier to buy would still be low and poor or middleclass people can’t afford such goods and services anyway. A system without income tax could also result in very simple tax reporting for most people, an additional benefit.
  - madsbuch 4y ago
    > get 1 USD wage as CEO and remainder in stock, for example This is usually not possible. In Denmark you are taxed the same whether you receive your payment in stock or money. When you receive stock, you are taxed on the value of the stock at receive time -- obviously this is awful for receiving grants in a startup where the paper value is high, the stock is iliquid and the risk is substantial. I think where the rich really benefits are the equity line of credit (ELOCs), where they effectively move money around without generating taxable events -- usually for very small interest payments.
    - maccard 4y ago
      Those ELOC schemeshave been clamped down on _hard_ in the last decade to the point of not really being a thing anymore The real benefit to the rich is capital gains rates are significantly lower than income tax rates in many places, so anyone who is paid via capital gains pays significantly less tax. The income tax over 150,000 in the UK is 45% plus 3% for national insurance, and capital gains is a flat 20% for someone on that income level.
    - wsc981 4y ago
      The point is that most taxes except wealth and consumption taxes are very easily avoided by wealthy people. Perhaps even taxes on wealth are hard, since wealthy people can just create some kind of charity and move most of their wealth into the charity. Make the charity fully controlled by the family and it's a great way to protect ones wealth. Most of the income can be spend on stock purchases and perhaps <1% of the yearly profit can be spend on the actual charity, while another big part of the profits can be used to provide secure income for family members and friend working for the charity. Also, it's a way to avoid inheritance tax and to prevent someone running off with part of the wealth after a divorce. Taxing income is in my opinion both unethical and rich people can avoid tax on most of their income anyways if they put in a little effort.
chitowneats 4y ago
The theory is that broadening the tax base will create a large constituency with a vested interest in responsible government spending. Or perhaps, more cynically, for lower taxes overall.
- rnk 4y ago
  The really rich often have too much political influence on elections, they push to get their taxes reduced effectively. This happens in the us where the terrible supreme court ruling said money was speech, basically making it so rich people could give all they want towards political causes. This is very destructive. The rich then get tax cuts for themselves that aren't applicable to regular people (like most all of us). Example of something we should address - bezos and musk get loans on their vast stock holdings. The loans aren't taxable. If their holdings slowly get higher in value, they never have to sell their stock to get that value (or they have so much they never get a margin call). They can pass on those stocks to their heirs which can reset the price. I wish we all had a billion in stock and we could get a few tens of millions in loans to live off of, never triggering a capital gains tax. Another example is wealth taxes, which would be something along the line of Steve Ballmer has to pay 1/2 % of his wealth over 100 million or something every year. But what if he doesn't have ready available cash for that, people say, it's hard to value things. Somehow we could do it. And we never think about it, but everyone who owns a house has to pay a wealth tax every year! We normal people pay wealth taxes, the really rich should probably have to do it too. All the same arguments about changing values and not have ready money from an expensive asset applies to every home own in america who pays property tax.

octagonal 4y ago

It acts as a "pre-emptive" tax shift. If more people pay taxes there's going to be less pressure on the government to set an ever higher tax rate, because now they receive more money while levying the same amount.

PietdeVries 4y ago
If more taxes is the reason for this rule, then why try to justify it with references to terrorism?
cracrecry 4y ago
As someone who has lived in socialist countries for a long time... the Government always wants more money until they have it all. It is as simple as that. "Less pressure" on the Government is a joke. The more it has, the more it wants. If you give your power away, they take it, and want more. Power 101. The money will be spent on things like public Media and public education to make propaganda for the Government. And on making the people in power mega rich, just like in China, Russia, Cuba, Venezuela or Argentina.
yucky 4y ago
Governments only get bigger, never smaller.

josephcsible 4y ago

The government needs a certain amount of revenue. If some people get away with cheating on their taxes, then the tax rates for everyone else need to be higher to get that much revenue.

wsc981 4y ago
Income tax should be abolished though. Wealthy people can avoid it easily (get 1 USD wage as CEO and remainder in stock, for example). Only consumption and wealth should be taxed. Wealthy people tend to consume more anyways. For some goods & services (energy consumption for example) a progressive tax rate might be appropriate, with tax exception for people who consume the least (as poor tend to do). Luxury goods and services (private planes and yachts, luxury car brands, etcetera should also have a higher than normal tax rate, since for wealthy people the barrier to buy would still be low and poor or middleclass people can’t afford such goods and services anyway. A system without income tax could also result in very simple tax reporting for most people, an additional benefit.
- madsbuch 4y ago
  > get 1 USD wage as CEO and remainder in stock, for example This is usually not possible. In Denmark you are taxed the same whether you receive your payment in stock or money. When you receive stock, you are taxed on the value of the stock at receive time -- obviously this is awful for receiving grants in a startup where the paper value is high, the stock is iliquid and the risk is substantial. I think where the rich really benefits are the equity line of credit (ELOCs), where they effectively move money around without generating taxable events -- usually for very small interest payments.
  - maccard 4y ago
    Those ELOC schemeshave been clamped down on _hard_ in the last decade to the point of not really being a thing anymore The real benefit to the rich is capital gains rates are significantly lower than income tax rates in many places, so anyone who is paid via capital gains pays significantly less tax. The income tax over 150,000 in the UK is 45% plus 3% for national insurance, and capital gains is a flat 20% for someone on that income level.
  - wsc981 4y ago
    The point is that most taxes except wealth and consumption taxes are very easily avoided by wealthy people. Perhaps even taxes on wealth are hard, since wealthy people can just create some kind of charity and move most of their wealth into the charity. Make the charity fully controlled by the family and it's a great way to protect ones wealth. Most of the income can be spend on stock purchases and perhaps <1% of the yearly profit can be spend on the actual charity, while another big part of the profits can be used to provide secure income for family members and friend working for the charity. Also, it's a way to avoid inheritance tax and to prevent someone running off with part of the wealth after a divorce. Taxing income is in my opinion both unethical and rich people can avoid tax on most of their income anyways if they put in a little effort.

chitowneats 4y ago

The theory is that broadening the tax base will create a large constituency with a vested interest in responsible government spending. Or perhaps, more cynically, for lower taxes overall.

rnk 4y ago
The really rich often have too much political influence on elections, they push to get their taxes reduced effectively. This happens in the us where the terrible supreme court ruling said money was speech, basically making it so rich people could give all they want towards political causes. This is very destructive. The rich then get tax cuts for themselves that aren't applicable to regular people (like most all of us). Example of something we should address - bezos and musk get loans on their vast stock holdings. The loans aren't taxable. If their holdings slowly get higher in value, they never have to sell their stock to get that value (or they have so much they never get a margin call). They can pass on those stocks to their heirs which can reset the price. I wish we all had a billion in stock and we could get a few tens of millions in loans to live off of, never triggering a capital gains tax. Another example is wealth taxes, which would be something along the line of Steve Ballmer has to pay 1/2 % of his wealth over 100 million or something every year. But what if he doesn't have ready available cash for that, people say, it's hard to value things. Somehow we could do it. And we never think about it, but everyone who owns a house has to pay a wealth tax every year! We normal people pay wealth taxes, the really rich should probably have to do it too. All the same arguments about changing values and not have ready money from an expensive asset applies to every home own in america who pays property tax.